: Realty Corporation Ltd v The Commissioner for Main Roads (1940) 14 LGR 204 at 205
If the whole of the land had been resumed, the measure of compensation, apart from special considerations such as the first item dealt with here, would have been that laid down in Spencer v. Commonwealth of Australia ([1907] 5 C.L.R. 418), namely the price that a willing purchaser would at the date of resumption have had to pay to a vendor not unwilling but not anxious to sell. Part only of the land having been resumed, an additional factor enters because it is necessary to consider not only what would have been obtained for the part resumed from the hypothetical purchaser, but also what damage, if any, inures to the remaining land by the fact of severance. The combined effect of the value of what has been taken away and the damage, if any, caused by the severance can be ascertained by subtracting from the value to the plaintiffs at the date of resumption of the land held by them prior to resumption the value to them at that date of the land retained by them after the resumption. In ascertaining either of these values it is relevant to consider the use to which the land can be put.
: Hordern v Sydney City Council (1940) 14 LGR 200 at 203/204
16 Reynolds JA, in giving the judgment of the Court of Appeal in Gosford Shire Council v Green (1980) 48 LGRA 201 at 208 cited with approval the judgment of Roper J in Realty Corporation and explained the rationale and function of the before and after valuation method in the following statement:
If the whole parcel is valued at the time of resumption and then the residue is valued, the difference is the ascertained amount of compensation, and severance damage and enhancement of the value of the residue are comprehended without any necessity for specification.
17 All three Valuers who gave evidence in the case employed the before and after valuation method, and obviously there can be no demur to that common approach adopted by these highly experienced Valuers, other than to question whether all of the Applicant's retained lands (comprising three lots) should have been included in the exercise. This is because the compulsorily acquired land was created by the subdivision of only one of those lots (ie lot 117) and the residue of that lot following the registration of Deposited Plan 1042996 was relevantly "severed from" and "adjoins" the compulsorily acquired land (vide s 55(f) of the Just Terms Act), although it may also be fairly said that lots 118 and 119 relevantly 'adjoin" the compulsorily acquired land. Another reason for otherwise legitimately confining the adjoining land to lot 23 is the joint opinion of the two town planning experts (Mr Rhodes and Mr Sanders) that lot 117 was capable of being developed independently of lots 118 and 119 and the development potential of lot 117 in both its before, and after, compulsory acquisition conditions was agreed to be 14 lots and community lot in a community title subdivision before acquisition, and 11 lots in a conventional land subdivision after the acquisition.
18 But this is only a possible qualification on the application of the before and after subdivision method commonly adopted by the three Valuers and is not of such importance as to require rejection of the valuation method employed if that were the only criticism of the valuation method that was employed.