Brisbane City Council v Valuer-General

Should the Land Appeal Court have held that the submerged parts of each parcel of the subject parcels had a minimum unimproved value as grazing land?

Was the Land Appeal Court in error or mistaken in law in not regarding the concrete structure of the dam, and the impounded waters held by it spreading over each of the subject parcels, as improvements which ought to have been notionally removed to arrive at the proper unimproved value of each parcel?

Having regard to the state of the evidence and the relevant onus of proof, was the Land Appeal Court in error or mistaken in law in the determining the value of the submerged lands at $1 per acre?

Was the Land Appeal Court in error or mistaken in law in the method which it adopted in the determination of the unimproved values of each of the 8 disputed parcels?

Having regard to the state of the evidence and the relevant onus of proof, was the Land Appeal Court in error or mistaken in law in disturbing the Valuer-General's reduced determinations as set out in par. 18 hereof?

(2) Brisbane City Council recover against the Valuer-General its costs of the appeal to the Full Court of the Supreme Court to be taxed.

This appeal arose out of valuations made by the respondent, the Valuer-General for the State of Queensland, of eight parcels of land owned by the appellant, Brisbane City Council, and situated in the Stanley River valley in the State of Queensland. The valuations were made under the Valuation of Land Act, 1944 Q., as amended, ("the Act") and subject to objection or appeal were to take effect on 30th June 1970. Valuations made under the Act are effective for the purposes of land tax and rating: see s. 25 of the Act. The lands are within the Shire of Esk and, as will be seen, Brisbane City Council is liable to pay the rates levied on them under the Local Government Act, 1936 Q., as amended.

The lands were amongst those which had been resumed for the purposes of the construction of the Somerset Dam, which was built for the purpose of providing an additional water supply for the cities of Brisbane and Ipswich, and also as a measure of flood mitigation. Later, by s. 9 of City of Brisbane (Water Supply) Act of 1959 ("the Act of 1959") the dam itself, and the fee simple in the lands described in the first schedule to the Act, which include the lands now in question, were vested in Brisbane City Council on and from 1st July 1959. By s. 10 of that Act Brisbane City Council has the power and duty to maintain, manage, control, operate and safeguard (inter alia) the dam and all lands appurtenant to it. Since that time Brisbane City Council, in the exercise and performance of its statutory powers and duties, has distributed waters from the dam to consumers through the water supply systems of Brisbane and Ipswich and has received revenue therefore by way of water rates.

Each of the parcels of land in question is partly covered by the waters retained by the concrete wall of the dam. Two of the parcels are on opposite sides of the river at about the point where the wall is built and each of those two parcels is covered to the extent of about two acres (out of a total area of 716 acres and 158 acres respectively) by part of the dam's concrete structure. The remaining parcels are situated around the edges of the body of water impounded by the dam. Each of the parcels consists partly of land which is covered permanently by the impounded water of the dam ("the submerged land") and partly of land which is not permanently covered ("the emergent land"); some of the emergent land may be inundated at times for a short period ("the marginal land"). According to the findings of the Land Appeal Court to which reference will later be made, the total area of submerged land in the parcels is 1,206.55 acres, and the total area of emergent land is 1,932 acres, of which 342 acres is marginal land.

Five parcels of the land are leased by Brisbane City Council to various tenants. The leases were originally made by the Coordinator General of Public Works, who was the predecessor in title of Brisbane City Council, and they are unaffected by the Act of 1959, except that Brisbane City Council has become a party to them by virtue of s. 15 of that Act. However, the existence of these leases does not seem to be material for present purposes.

Objections to the valuations having been made and disallowed, Brisbane City Council appealed to the Land Court under s. 21 of the Act. Before the appeal was heard the Valuer-General, acting under s. 21A of the Act, reduced the valuations and advised that the new valuations would take effect as from the 30th June 1973. Brisbane City Council did not accept the reduced valuations which were by s. 21A then deemed to be the valuations appealed against. The Land Court dismissed the appeals and confirmed the reduced valuations. Brisbane City Council brought a further appeal to the Land Appeal Court. Such an appeal is by way of re-hearing: s. 21 (5) of the Act; in practice there is an actual re-hearing on fresh evidence, and the Land Appeal Court is entitled and bound "to form an altogether independent judgment on the whole case, quite irrespective of the reasons for the conclusion of the Land Court" (Reg. v. Rigby [1] ). The Land Appeal Court allowed the appeals and reduced the valuations. Thereupon the Valuer-General appealed to the Full Court of the Supreme Court of Queensland by case stated. The questions asked in the case stated were answered by the Full Court in favour of the Valuer-General. From that decision Brisbane City Council has appealed to this Court.

The parties before the Land Appeal Court agreed, and the Land Appeal Court concluded, that the emergent land, including the marginal land, in each parcel should be valued on the basis that its highest and best use was for grazing cattle. No question arises on this appeal as to the emergent land. In deciding what valuation should correctly be placed on the submerged land, the Land Appeal Court had to choose between two different methods of approach. On the one hand evidence was presented on behalf of the Valuer-General of valuations of each of the eight disputed parcels made upon the basis that no regard was had to the fact that impounded water from the dam covered portion of each parcel. In other words they were valued as good alluvial river flat lands, which in fact they had been before their inundation by the waters of the dam. The Land Appeal Court found that if the parcels were rightly valued as grazing land, and upon the basis that no regard should be had to the fact that parts of them were covered with water, the reduced valuations of the Valuer-General were not excessive. On the other hand Brisbane City Council contended that the permanent presence of the water could not be ignored in making the valuation. In fact the evidence of value presented by Brisbane City Council was confined to the emergent portion of each parcel including marginal land, but regard was had to the water on the submerged portion in each case where access was available to that water for grazing purposes. The Valuer-General submitted that the submerged land could have an unimproved value as land used for the retention of water, in excess of the value which it would have had if free of the retained water, and the only valuer called on behalf of Brisbane City Council conceded that he was not competent to place a value upon the submerged lands on the basis that they were used for the retention of water.

The Land Appeal Court rejected the method of valuation which the Valuer-General had adopted. It held that neither the impounded water of the dam nor the structure of the dam nor any portion of them could be regarded as an improvement within the meaning of the Act in arriving at the unimproved value of any of the parcels. Accordingly it held that the submerged land and the marginal land should be valued upon the basis that it was covered, permanently or temporarily as the case might be, by part of the dam and its waters. However the Court held that in the state of the evidence it was entitled to apply a dollar per acre to all the submerged land contained in each of the parcels as being its highest value unimproved, assessed on the basis of its value for water content over and above any added value which the submerged land gave to the emergent land, including the marginal land, as grazing land.

The foregoing account is based upon the statement of the facts and of the grounds of decision set out in the stated case. A copy of the reasons for judgment of the Land Appeal Court was annexed to and incorporated in the case, and those reasons reveal more fully the nature of the approach both of the parties and of the Court to the questions in issue. The Land Appeal Court found that the areas of submerged land in each case were of or about the areas estimated by Mr. Jones, the valuer called for Brisbane City Council, and adopted the unimproved values given by Mr. Jones for the emergent land including the marginal land. However, as has already been indicated, Mr. Jones "confined the application of any monetary value assessed by him to the emergent land in each case". The valuer called on behalf of the Valuer-General was Mr. Conroy. In making his valuation Mr. Conroy had no regard to the fact that water impounded by the dam lay over portion of the land. In other words he valued the land as if the water, and the thick layer of silt which it had deposited, were notionally removed and as if the land were in the condition in which it was before the dam was built. He took this course because he considered that he was obliged by authority to disregard any statutory restrictions on the user of the land. He did not regard that portion of the impounded water of the dam which was on any parcel of land as an improvement.

The Land Appeal Court said that they had no doubt that Mr. Conroy considered that he was required to value according to the rule laid down in Royal Sydney Golf Club v. Federal Commissioner of Taxation [2] and Gollan v. Randwick Municipal Council [3] , which they stated as being that in assessing the unimproved value for the purposes of the Act, an estate in fee simple must be taken as a hypothetical unencumbered fee simple, without regard to any restrictions on title or user other than those imposed by the general law. They accepted that this principle applied, but said that it did not affect the basic rule that in making a valuation regard must be had to any physical disabilities affecting the land. They held that Mr. Conroy's approach could only be justified if the water was an improvement on the land. As to that question they said:

The fact that he has removed the water and that it is implicit in his valuation that in doing so he thereby assessed a higher unimproved value on such uncovered "submerged land", and a higher total value for each whole parcel than if he had left the water there, leaves only one inference open and that is that he regarded such water as a detriment on the land. They went on to hold that the water was not an improvement, first because water in itself is not an improvement on land and secondly, because the method adopted by Mr. Conroy "itself completely repudiates the suggestion that any operation of man in putting water on the submerged lands in these cases has enhanced the value of any such land." They accordingly held that the lands had to be valued as they were in fact with the water over them. When they came to apply their decision on principle to the facts of the case they said that they were "hampered to some extent by the failure of the parties to furnish evidence on all the matters that we think have to be considered". They held that the submerged land - or the "water content land" as they proceeded to call it - would have a saleable value, as being contiguous with the large volume of water available to supply the cities of Brisbane and Ipswich and also as an adjunct to a picnic or recreation area, or as part of such an area as for instance a waterskiing area. The conclusion which they reached on this question was expressed as follows: In our judgment, having regard to the evidence before us, we can do no better than proceed along the same lines on the assumption that the only value these water content lands would have, in each case, to a hypothetical vendor, over and above the additional value each gives to its emergent and marginal lands as grazing land, could be the figure or price at which he and the appellant in these cases as hypothetical purchaser would come together. We think this would be the same unit figure in each case, rather than a percentage figure based on the emergent and marginal land values. We adopt and apply $1 per acre to these water content areas. 1. (1955) 91 C.L.R. 610. 2. [1961] A.C. 82.

In the Full Court Hanger C.J. disposed of the matter by holding that the building of the dam causing water to accumulate on the lands had effected an improvement to the lands. D. M. Campbell J. did not find it necessary to decide whether the lands were improved or unimproved. He held that the lands with water on them had a special value to Brisbane City Council, and that Brisbane City Council had not discharged the onus of showing that the Valuer-General's valuation was wrong. Dunn J., who dissented, held that the question whether the submerged lands were improved or unimproved was one of fact and that it was not open to the Full Court to substitute a finding of its own for the finding of the Land Appeal Court. He rejected the further arguments that there was no evidence upon which the Land Appeal Court could have reached a conclusion as to the value of the lands with water upon them, that Brisbane City Council had therefore not displaced the presumption in favour of the valuation created by s. 13 (7) of the Act, and that in the absence of evidence as to the value of lands with water upon them it was wrong to hold that the lands were less valuable in their actual than in their hypothetical state.

By s. 21 (6) of the Act an owner or the Valuer-General is given a right to appeal from the decision of the Land Appeal Court to the Full Court of the Supreme Court "on the ground that the decision is erroneous in point of law or is in excess of jurisdiction". The appeal is by way of case stated under the provisions of ss. 45-48 of the Land Acts, 1962 Q., as amended, which are rendered applicable by s. 21 (8) of the Act. Section 45 (1) enables a party aggrieved by the decision of the Land Appeal Court "on the ground of error or mistake in law on the part of the Land Appeal Court or that the Land Appeal Court had no jurisdiction to make the decision or exceeded its jurisdiction in making the decision" to request the Land Appeal Court to state and sign a case setting forth the facts and the grounds of decision. By s. 47 the Full Court is to hear and determine "every question of law" arising on the case stated. It is apparent from these provisions that the question for our decision on this appeal is whether the case stated reveals that the Land Appeal Court committed any error of law. Of course if the Land Appeal Court erred in principle in arriving at its valuation, that would constitute an error of law: if authority is needed for that proposition the recent judgment of the Judicial Committee in Melwood Units Pty. Ltd. v. Commissioner of Main Roads [4] provides it. The first question that arises is whether it was an error in principle to hold that the land should be valued in its actual rather than in its notional state.

It was not contested before us that this question depended on whether the water, or perhaps the dam, constituted an improvement in relation to the lands in question. A valuation on the basis that the water covering the land was deemed not to exist could only be justified if the water was an improvement. By s. 11 (1) of the Act the Valuer-General is required to make a valuation of "the unimproved value" of the land. The expression "unimproved value" is defined by s. 12 (1) as follows:

(a) in relation to unimproved land, the capital sum which the fee simple of the land might be expected to realise if offered for sale on such reasonable terms and conditions as a bona fide seller would require; and

in relation to improved land, the capital sum which the fee simple of the land might be expected to realise if offered for sale on such reasonable terms and conditions as a bona fide seller would require, assuming that, at the time as at which the value is required to be ascertained for the purposes of this Act, the improvements did not exist:

Provided that the unimproved value shall in no case be less than the sum that would be obtained by deducting the value of improvements from the improved value at the time as at which the value is required to be ascertained for the purposes of this Act;

(b) "The value of improvements" means, in relation to land, the added value which the improvements give to the land at the time as at which the value is required to be ascertained for the purposes of this Act, irrespective of the cost of the improvements,

Provided that the added value shall in no case exceed the amount that should reasonably be involved in effecting, at the time as at which the value is required to be ascertained for the purposes of this Act, improvements of a nature and efficiency equivalent to the existing improvements; and

(c) "Improvements" means in relation to land, improvements thereon or appertaining thereto, whether visible or invisible, and made or acquired by the owner or his predecessor in title

These provisions make it necessary to determine for valuation purposes, whether the land in question is improved or unimproved. They also indicate what tests should be applied in deciding what is an improvement for the purposes of the valuation. In the first place, an improvement in relation to land must be "thereon or appertaining thereto". This means that the improvements, if not on the land, must be "such as are in the strict legal sense "appurtenant" to the property and incident to its ownership" (McDonald v. Deputy Federal Commissioner of Land Tax (N.S.W.) [5] ). Secondly, something done on or appertaining to land which reduces rather than enhances its value is not an improvement for the purposes of the Act, any more than it would be in the ordinary sense of the word. In Morrison v. Federal Commissioner of Land Tax [6] , Griffith C.J. said, in a passage which has frequently been cited: "Any operation of man on land which has the effect of enhancing its value comes within the definition of "improvement"."

1. (1915) 20 C.L.R. 231, at pp. 234-235. 2. (1914) 17 C.L.R. 498, at p. 503.

It appears clear enough that the wall of the dam was not an improvement in relation to the lands in question, even to the two parcels on which a small part of the structure stands. The wall itself (or the greater part of it) is not on the lands and does not appertain to them within the meaning of the definition. The real question is whether the water is an improvement. I agree with the view expressed by the Land Appeal Court that water in itself is not an improvement. Improvements, as has been said, consist of something done which has enchanced the value of land. To build a dam, or to improve a watercourse, so that water may be collected on or flow over land may improve the land, but it is the dam or the watercourse, and not the water, that constitutes the improvement. But even if that did not dispose of the matter, the water could only be an improvement if its presence enhanced the value of the lands. Whether it did so or not is a question of fact. There is no doubt that a dam, an artificial lake or a swimming pool may in many cases be an improvement to the land on which it is built. However, whether that will be so or not will depend on the facts of the case. For example, if a grazing property has more dams than are necessary to water the stock that it can carry, the erection of an additional dam could not usually be said to be an improvement. Similarly, assuming that water can itself be an improvement, whether it is so is a question of fact. In Reg. v. Rigby [7] , this Court, in a passage to which I shall again refer, repeated what is well settled, that upon a case stated the court cannot determine questions of fact. In the present case, it has not been established that the Land Appeal Court was wrong in law in holding that the water did not enhance the value of the lands. The only error in law that could be suggested was that there was no evidence to support that conclusion. However, for reasons which I shall later elaborate, I consider that the form of the case stated makes it impossible to hold that there was no evidence to support any particular finding. Common sense suggests that in the ordinary course of events the permanent inundation of lands is detrimental to them and depreciatory of their value. However that may be, it has not been shown that there was no evidence on which the Land Appeal Court could find that the water did not enhance the value of the lands in the present case. For these reasons it has not been established that the Land Appeal Court erred in law in holding that the water was not an improvement and that the lands should be valued in their actual state.

The parts of the concrete structure which stand on two of the parcels would of course be improvements to those parcels if they enhanced their value. Whether they did so or not is a question of fact. There is nothing in the case to suggest that the Land Appeal Court erred in law in not treating them as improvements. Further, having regard to the respective sizes of the parcels and of the areas on which the structure stood, it appears that D. M. Campbell J. was quite correct in saying that they were not large enough to be of consequence.

It is necessary to notice a further submission made on behalf of the Valuer-General that even if the water was not an improvement within the Act, the special provisions of the Act of 1959 required the submerged lands to be valued as though the water did not exist. The latter Act, by s. 12, provided as follows:

Any land described in the First Schedule to this Act shall be rateable land under and within the meaning of "The Local Government Acts, 1936 to 1958", and additionally Brisbane City Council shall be liable to pay and discharge all charges and assessments in respect of any such land duly made by any person or authority other than the Local Authority at all times on and after the first day of July, One thousand nine hundred and fifty-nine, during which any person other than Brisbane City Council occupies that land under any lease, agreement to lease, licence, or other contract, agreement, or arrangement entered into by him with Brisbane City Council or the Co-ordinator General of Public Works. It is quite clear that this section renders the lands in question ratable and that in Ex parte Kilcoy Shire Council [8] , Sheehy J. was right in rejecting an argument that the latter part of the section in some way qualifies, affects or cuts down the words of the first part. However it was submitted that legislature, in enacting the section, intended to compensate the Kilcoy Shire Council for the loss of rate revenue arising from the compulsory alienation of a considerable portion of valuable ratable land, and a dictum in Ex parte Kilcoy Shire Council [9] was cited in support of this argument. When the Act of 1959 was enacted it must have been apparent to the legislature that by reason of the construction of the dam and the devotion of the lands to the purposes thereof the local authorities in which the lands were situated - including the Esk Shire Council and the Kilcoy Shire Council - might lose considerable revenue from rates unless special legislation were enacted. In the absence of such legislation the lands might fall within one of the exemptions contained in pars. (c) and (d) of s. 24 (1) (i) of the Local Government Act, 1936 Q. as amended and if so they would not be ratable. The legislature dealt with this question by s. 12 of the Act of 1959 and declared that the lands are to be ratable. However it did not go further and provide a new basis for their valuation. It is not correct to say that s. 12 would have no effect, or only a nominal or illusory effect, if it rendered the lands in the first schedule ratable but did not affect the method of their valuation. On no view could the lands in the first schedule be regarded as having little or no ratable value. Only parts of the lands were submerged; the balance - the emergent land - retained its value, and in many cases probably increased considerably in value because of the increased availability of water. There is no justification for giving to the words of s. 12 a meaning other than their plain and natural meaning. It would be the merest speculation to say that the legislature intended to provide that the submerged lands should be valued as if they had not been inundated. Section 12, properly construed, has nothing to say in relation to the question how the lands are to be valued for rating purposes; it does no more than render them ratable. If Sheehy J. intended to suggest to the contrary in Kilcoy Shire Council [10] he was in error. 1. [1967] Q.W.N. 26. 2. [1967] Q. W.N. at p. 48. 3. [1967] Q.W.N. 26.

On behalf of the Valuer-General, some reliance was placed on the Somerset Dam Catchment Area Declaratory Act, 1974 ("the Act of 1974"). That Act was apparently enacted to resolve disputes between Brisbane City Council and lessees from the Council of some of the lands described in the first schedule to the Act of 1959. The scheme of the Act of 1974, broadly stated, is to make Brisbane City Council solely liable for rates on all the lands (see s. 3, whose words are however badly chosen), to ensure that lessees are not liable to pay Brisbane City Council anything on account of rates levied in respect of submerged lands (s. 4), to give consequential relief to lessees (ss. 5-7) and to provide a method for the apportionment of rates between submerged and emergent lands. For the last-mentioned purpose, s. 8 (1) and (2) provide as follows:

(1) In any case where, in the absence of agreement on the issue, it becomes necessary (for the purpose of giving effect to this Act) to ascertain what part of a rate made and levied or paid in respect of land within the Somerset Dam Catchment Area in relation to a particular period shall be apportioned to submerged land and what part of such rate shall be apportioned to other land, such apportionment shall be carried out as prescribed by this section and according to the formula -

The factor "UVSL" is the unimproved value of the submerged land in question at the time the rate to be apportioned was made and levied;

the factor "UVWL" is the unimproved value of the whole of the land in respect of which the rate to be apportioned was made and levied at the time it was made and levied;

the factor "R" is the amount of the rate to be apportioned;

the unimproved values referred to in the formula are those ascertained by the Valuer General subject to this Act.

The amount ascertained according to the formula prescribed is the part of the rate that shall be apportioned to the submerged land in question.

The part of the rate that shall be apportioned to the land in question other than submerged land is the amount equal to the difference between the whole rate made and levied in respect of the land in question and the amount ascertained according to the formula prescribed.

Section 9 (1) provides that the unimproved value in the factor "UVWL" shall be the unimproved value for the purposes of the Act. Section 9 (2) then makes the following provision as to the unimproved value in the factor "UVSL":

(2) For the purpose of ascertaining the unimproved value in the factor "UVSL" referred to in section 8 the Valuer-General is hereby authorised and required to ascertain the unimproved value of the submerged land at the material time as if such land were a separate parcel and without regard to the fact or extent of inundation of such land by the waters of Somerset Dam (defined in The City of Brisbane (Water Supply) Act of 1959) at the material time.

By s. 10 provision is made for a revaluation of the submerged land in certain circumstances; in making any such revaluation the Valuer-General is required to comply with s. 9 (2).

These provisions are designed to regulate the relationship between Brisbane City Council and its lessees, and they do not prescribe any method of valuation for purposes other than those of the Act of 1974. But in the argument put on behalf of the Valuer-General it was sought to use them in the following way. The fact that to ascertain the factor "UVSL" it is necessary to value the submerged land on the assumption that it has not been inundated suggests that a similar assumption was expected to be made when the whole of the land was valued for the purpose of ascertaining the factor "UVWL", for otherwise the formula in s. 8 would appear likely to give a distorted result. Section 9 (1) requires "UVWL" to be ascertained by reference to the valuation made under the Act. Therefore it was submitted that the legislature, in enacting the Act of 1974, gave recognition to the principle that an ordinary valuation under the Act should be made on the assumption that the submerged land was not inundated, and that in that way the Act of 1974 throws light on the meaning of the Act of 1959. However in my opinion the Act of 1974 does not provide any clear indication either of the meaning of the Act of 1959 or of the policy of the legislature with regard to the method of valuation of the submerged land. The reason why the submerged land is to be valued on a notional basis in arriving at "UVSL" for the purpose of the Act of 1974 is that s. 9 (2) of that Act so provides. If under the ordinary principles of law applied by the Valuer-General in making a valuation for the purposes of the Act, or under the special provisions of the Act of 1959, the submerged land should be valued on a notional basis, it would be unnecessary for s. 9 (2) to require it to be valued on that basis. The very provisions of s. 9 (2), on which this argument of the Valuer-General is founded, suggest that the submerged land should be valued in its actual state unless special provision is made to the contrary. The provisions of the Act of 1974 do no more than provide arguments pro and con as to the pre-existing law, and do not resolve the question. I am unable to regard the Act of 1974 as providing a guide to the meaning of the Act of 1959 or the effect of the earlier law.

For these reasons I hold that no error of law has been shown in the conclusions of the Land Appeal Court that neither the water nor the dam was an improvement, and that the lands should be valued in their actual state; on the contrary I agree with those conclusions. However it was then submitted on behalf of the Valuer-General that even if the Land Appeal Court was correct in reaching those conclusions its ultimate decision, that the appeal should be allowed and that the submerged land should be valued at $1 per acre, was erroneous in law, because there was no evidence that the valuation of the Valuer-General was excessive in amount, or that the submerged land had a value of $1 per acre. As part of this argument it was said that Brisbane City Council had not displaced the presumption created by s. 13 (7) of the Act as to the correctness of the valuation, or discharged the onus cast on it by s. 21 (3) and (5) of the Act.

Any and every valuation, or alteration of the valuation, of any land made, or purporting to be made, under this Act by the Valuer-General shall be deemed to be correct until proved otherwise upon objection or appeal or until altered or further altered pursuant to a provision of this section. The argument based by the Valuer-General on this provision was, first, that the valuation which is presumed to be correct is the figure arrived at as a result of the process of valuation - the unimproved value in dollars and cents - and, secondly, that in order to displace the presumption it is not enough to show that an error in principle was made by the Valuer-General in arriving at the value, because the valuation, though unsoundly based, might nevertheless not be excessive. The word "valuation" is used in the Act in shifting senses, and, as was said in Kilcoy Shire Council v. Brisbane City Council [11] , it "covers both the activity of assessing value and the reduction of that assessment to written form". However, I accept that in s. 13 (7) it at least includes the amount of the valuation, and that there is a presumption that the value in money terms shown by the Valuer-General in his notice of valuation is correct. The question then is whether a court on appeal is bound to accept the Valuer-General's figure as correct unless it is positively established that the true value is lower, or whether it is enough to show that the value was reached as the result of an error in principle. In my opinion once it is shown that in making the valuation the Valuer-General acted upon a wrong principle, or made a serious error of fact, the presumption created by s. 13 (7) is rebutted. It is true that the Valuer-General might by coincidence reach the right result by a wrong process of reasoning, but I cannot attribute to the legislature the capricious intention that a valuation shown to have been erroneously made should be presumed correct simply because by mere chance the Valuer-General may have hit on the right figure. If, for example, lands were valued as suitable for high rise city buildings although the law forbad them to be put to that use, or as rich agricultural land when in fact they had been rendered useless by excessive salinity, it would be absurd to hold that the valuation, although shown to be radically wrong, still must be deemed correct. In my opinion once it is shown that a valuation was made by a method fundamentally erroneous the presumption is rebutted. In the present case the presumption of correctness was rebutted once it was held that the submerged land should be valued in its actual state and not in the notional state in which the Valuer-General had valued it. 1. (1971) 124 C.L.R. 60, at p. 67.

Section 21 (3) of the Act, so far as it is material, provides as follows:

An appeal under this section shall be instituted by filing in the Land Court registry a notice of appeal.

Such notice shall state the grounds of appeal and the appeal shall be limited to the grounds so stated, and the burden of proving any and every such ground shall be upon the owner.

Such notice shall also state the amount which in the opinion of the appellant should be the valuation of the subject land.

Since, under s. 21 (5), an appeal to the Land Appeal Court is a rehearing, the same burden of proof must apply. By s. 21 (7) - Upon an appeal under this section the Land Court or, upon the re-hearing of any such appeal, the Land Appeal Court may -

(b) Reduce or increase the amount of that valuation to the extent necessary in its opinion to determine the same correctly under, subject to, and in accordance with this Act,

The effect of these provisions is that an owner on appeal to the Land Appeal Court has the burden of proving the grounds of his appeal, but not the burden of proving that the amount which in his opinion should be the valuation is correct. Obviously the Court, if it allows an appeal, may determine the valuation at an amount different from that for which the owner contends.

The argument on behalf of the Valuer-General was that, once the valuation of the Valuer-General was rejected, there was no evidence as to the value of the submerged land. The case stated that the evidence of value called by Brisbane City Council was confined to the emergent land and the evidence of value called by the Valuer-General was rejected. Therefore, it was submitted, there was no evidence to support the valuation of one dollar per acre put on the submerged land by the Land Appeal Court, and indeed no evidence that the value of the submerged land in its actual state, as part of a dam, was less than its value in the notional state as grazing land. There was therefore, it was said, no evidence to support the decision which was accordingly erroneous in law.

In discussing whether there was evidence sufficient to support the decision both parties referred to and relied upon the analysis of the evidence contained in the reasons for judgment of the Land Appeal Court. It is customary to annex the reasons for judgment to the case stated and convenient to do so, to enable the matter to be properly understood. If the reasons revealed an error of law, no doubt the Full Court would be entitled to correct that error, even if it would not otherwise have appeared from the case stated. However in my opinion it is impermissible to regard the reasons for judgment as a statement of the facts or as a statement of the evidence.

Upon a case stated the court cannot determine questions of fact and it cannot draw inferences of fact from what is stated in the case. Its authority is limited to ascertaining from the contents of the case stated what are the ultimate facts, and not the evidentiary facts, from which the legal consequences ensue that govern the determination of the rights of parties. The question may be one of the relevance of evidence and then the nature of the evidence becomes in a sense an ultimate fact for the purpose of that question. But that is not a common case Similarly it would seem that if the question is whether there is any evidence to justify a particular finding it is permissible to set out in the case all the evidence on the point (which would become in a sense an ultimate fact for the purpose of the question). Such a course would not entitle the Full Court to consider questions of fact arising on the evidence; it would be limited to considering whether there was any evidence to support the finding. But that course was not taken here; the case stated does not set out all the evidence, and we are asked to infer from the case stated and the reasons for judgment what the evidence was. The Court is not entitled to draw any inferences from the case stated, and still less from the reasons. The submission now under consideration must fail because it does not appear from the case stated that there was no evidence to justify the conclusion of the Land Appeal Court. 1. (1956) 100 C.L.R., at pp. 150-151.

Even if it had been shown in the case stated that there was no direct evidence as to the value of the submerged land in terms of money it would not have followed that the decision of the Land Appeal Court was erroneous in law. Since it would be unsatisfactory to decide this appeal simply because the case stated did not contain sufficient material, it may be assumed for the purposes of argument that the reasons for judgment did set out all the relevant evidence. Clearly the Land Appeal Court was entitled to hold that the submerged land had some value for the purpose of water supply and recreation. One valuer, Mr. Jones, said that he was not competent to assess a value and that he knew of no comparable values that he could use for the purpose. However he did value the marginal land; his figures, which the Court adopted, ranged from $4 per acre to $25 per acre for the dry emergent land, and from $1 per acre to $15 per acre for the marginal land. It would seem to have been a legitimate if not a necessary inference that the value of the submerged land was less than that of the marginal land. Mr. Conroy took the matter no further. Thus the Court had evidence of the nature and uses, possible and actual, of the submerged land, of the fact that there appeared to be no comparable sales, and of the value of adjacent but more valuable land. Brisbane City Council had discharged the onus of proving the grounds of its appeal, for it had shown that the Valuer-General had valued on an incorrect basis; the Court therefore could not affirm the valuation appealed against. The Court then had to form its opinion as to the value of the submerged land on the material before it. In Raja Vyricherla Narayana Gajapatiraju v. Revenue Divisional Officer, Vizagapatam [13] , Lord Romer, delivering the judgment of the Privy Council, said:

But sometimes it happens that the land to be valued possesses some unusual, and it may be, unique features, as regards its position or its potentialities. In such a case the arbitrator in determining its value will have no market value to guide him, and he will have to ascertain as best he may from the materials before him, what a willing vendor might reasonably expect to obtain from a willing purchaser, for the land in that particular position and with those particular potentialities. The fact that no valuer had expressed an opinion as to the value of the submerged land in dollars and cents did not mean that there was no evidence on which a valuation could be made. In these circumstances the conclusion reached by the court was not erroneous in law. 1. [1939] A.C. 302, at pp. 312-3.

The final submission on behalf of the Valuer-General was that the Land Appeal Court was wrong in saying that it could do no better than proceed on the assumption that the only value the submerged land would have to a hypothetical vendor (apart from the additional value that the availability of water gave to the emergent lands) would be a figure at which the owner and Brisbane City Council as hypothetical purchaser would come together. It was submitted that there was a possibility that other hypothetical purchasers might exist. The Court appears to have been saying no more than that the highest and best value of the submerged land was for the purposes of a dam controlled by Brisbane City Council. As flooded land it obviously could not be used for grazing or agriculture, but it was adapted for use as the catchment area of a dam, and it seems to have been a proper inference that in its actual condition this was its greatest potential. If the land was reasonably capable of being put to other and more profitable use in the future, the fact that it could only be used as a dam at the date of the valuation would not mean that it should be valued as land capable only of the latter use: see the Raja Case [14] . But there was no likelihood that the land would cease to be flooded, and there were no potentialities to be taken into account other than those to which the Court adverted.

The first of the questions, which the Full Court did not answer, was somewhat obscurely phrased. It seems to have been intended to ask whether the Land Appeal Court, in determining the value of the land, should have taken into account, or given more weight to, the fact that Brisbane City Council derived revenue by way of water rates from the distribution and use of some of the water in the dam. It was not argued before us that the Court was wrong in this respect.

For these reasons I hold that it has not been established that the decision of the Land Appeal Court was erroneous in point of law. It may perhaps be added that the Valuer-General appears to have made his valuation on the basis which he considered had received judicial approval in Ex parte Kilcoy Shire Council [15] . It was of course right for him to follow that decision while it stood. It is however not clear that Sheehy J. intended to decide that the submerged land should be valued as if it had not been inundated. If that was his view he was in error. And as has already been indicated Sheehy J. was wrong in assuming that in enacting the Act of 1959 the legislature intended to compensate the local authorities concerned for loss of revenue by way of rates. The Act of 1959 is silent on the question how the submerged land should be valued and we cannot speculate what the legislature might have done had it directed its attention to that question.

I would allow the appeal and would set aside the judgment of the Full Court and in lieu thereof would order that each question in the case stated be answered, "No".

I agree that this appeal be allowed for the reasons stated by Gibbs J. and that the order should be in the form prepared by his Honour.

I am in general agreement with the reasons for judgment which have been prepared by Gibbs J.

Accordingly, I would allow the appeal and set aside the judgment of the Full Court. In lieu of that judgment I would order that each question in the case stated be answered in the negative.

I agree with Gibbs J.'s conclusions and generally agree with his reasons.

The history of the case (with its successive upsets) shows that some of its difficulties have been caused by the procedure for appeal by case stated from the Land Appeal Court. The lengthy argument in this appeal concerning the effect of the case stated illustrates the disadvantage of that procedure. Except in very simple cases, it generally introduces complications which obscure the real points to be decided. Whatever its theoretical merits, in practice it is one of the worst legal techniques. Invoking the stated case procedure generally results in a legal snarl. Sometimes this is due to careless statement of the case, but often it happens because even with care it is not easy to predict which findings an appellate court will consider necessary or relevant.

The appeal should be allowed and the questions answered "No".

I have had the advantage of reading the reasons for judgment of Gibbs J. with which I am in complete agreement. I would therefore allow the appeal and set aside the judgment of the Full Court and in lieu thereof order that each question in the case stated be answered, "No".