Cook, Saad, Raguz & Ors v Roads and Traffic Authority of New South Wales

FILE NUMBER(S) : 30549 of 2005; 30550 of 2005; 30551 of 2005

KEY ISSUES: Compulsory Acquisition of Land :- compensation - market value - injurious affection - severance - disturbance

LEGISLATION CITED: Land Acquisition (Just Terms Compensation) Act 1991 s 42, s 47, s 55(f), s 56, s 59, s 61, s 64, s 66 Roads Act 1993

Best v Housing Commission of NSW (1949) 17 LGR (NSW) 129; Boland v Yates Property Corporation Pty Ltd and Another (1999) 167 ALR 575 ; Brewarrana Pty Ltd v Commissioner of Highways [No. 1] (1973) 32 LGRA 170; Commissioner of Succession Duties (South Australia) v Executor Trustee and Agency Company of South Australia Limited and Others (1947) 74 CLR 358; De Ieso v Commissioner of Highways (1981) 27 SASR 248; Director of Buildings and Lands v Shun Fung Ironworks Ltd [1995] 2 AC 111; E J Cooper & Son Pty Limited v Baulkham Hills Shire Council (2003) 131 LGERA 226; CASES CITED: Fitzpatrick Investments Pty Limited v Blacktown City Council (No 2) (2000) 108 LGERA 417; Housing Commission of New South Wales v Falconer and Others [1981] 1 NSWLR 547; Koutsouras v State Rail Authority of New South Wales, unreported, NSWCA, 29 November 1991; Minister Administering the Environmental Planning and Assessment Act 1979 v Bautovich (2005) 142 LGERA 331; Roads and Traffic Authority (NSW) v Mosca (2006) 146 LGERA 335; Sandhurst Trustees Limited v Roads and Traffic Authority of NSW [2006] NSWLEC 243; Spencer v The Commonwealth of Australia (1907) 5 CLR 418; Tatmar Pastoral Company Pty Ltd and Anor v The Housing Commission of New South Wales, unreported, NSWLEC, No. 30115 of 1980, 17 March 1982; Woollams v The Minister (1957) 2 LGRA 338

DATES OF HEARING: 14/11/2006, 15/11/2006, 14/02/2007, 15/02/2007, 16/02/2007

APPLICANTS Mr J Webster SC SOLICITORS Grech Partners LEGAL REPRESENTATIVES: RESPONDENT Mr R Lancaster with Mr M McFadden SOLICITORS Henry Davis York

JUDGMENT: THE LAND AND ENVIRONMENT COURT OF NEW SOUTH WALES

MAXWELL COOK AND MARGARET JOYCE COOK Applicants

ROADS AND TRAFFIC AUTHORITY OF NEW SOUTH WALES Respondent

ANTHONY SAAD AND DAISY CONSTANTINE Applicants

ROADS AND TRAFFIC AUTHORITY OF NEW SOUTH WALES Respondent

ILIGA RAGUZ AND PAULINE RAGUZ Applicants

ROADS AND TRAFFIC AUTHORITY OF NEW SOUTH WALES Respondent

1 The applicants each owned a property fronting Windsor Road, Rouse Hill, being (respectively) lots 3, 4 and 5 in deposited plan 241463. On 4 March 2005, the Roads and Traffic Authority of New South Wales (the RTA) acquired, by compulsory process, the whole of lot 3 (the Raguz property) and part of lots 4 and 5 (the Cook property and the Saad and Constantine property respectively), for the purposes of the Roads Act 1993 (specifically, the upgrading of Windsor Road).

2 The RTA offered to pay compensation to the applicants on account of these compulsory acquisitions as determined by the Valuer-General in accordance with ss 42 and 47 of the Land Acquisition (Just Terms Compensation) Act 1991 (the Just Terms Compensation Act). The applicants each objected to the amount of compensation offered as provided for in s 66 of the Just Terms Compensation Act. The Court is to hear and dispose of those objections, determining the applicants' entitlements to compensation in accordance with Div 4 of Pt 3 of that Act.

3 The competing positions of the parties (excluding disturbance and statutory interest) are as follows: (1) Raguz proceedings: - Mr and Mrs Raguz claimed $4,000,000 for the acquired property (a rate of $200 per sqm, except for certain land affected by an easement) and $20,615 by way of solatium. The RTA accepted the claim for solatium, but said that the value of the acquired property was $2,330,000 (a rate of $115 per sqm).

(2) Cook proceedings: - Mr and Mrs Cook claimed $870,000 for the acquired property (a rate of $200 per sqm), $331,500 for severance under s 55(c) of the Just Terms Compensation Act, and $150,000 under s 55(f). The RTA said they were entitled to $433,000 for the acquired property (a rate of $100 per sqm), $149,000 for severance under s 55(c), and $73,000 under s 55(f).

(3) Saad and Constantine proceedings: - Mr Saad and Ms Constantine claimed $820,000 for the acquired property and $125,000 under s 55(f) of the Just Terms Compensation Act. The RTA said they were entitled to $410,000 for the acquired property (a rate of $100 per sqm) and $84,500 under s 55(f).

4 The RTA acquired the whole of the Raguz property (20,230 sqm). It acquired 4,096 sqm from the Saad and Constantine property, which was 20,996 before acquisition, leaving a residue of 16,900 sqm. It acquired 4,333 sqm from the Cook property, which was 21,159 sqm before acquisition. The acquisition of part of the Cook property severed the residue lot into two portions, a main portion of 14,540 sqm and a subsidiary portion on the other side of the upgraded Windsor Road of 2,286 sqm.

5 The properties were zoned Rural 1(a) under the Baulkham Hills Local Environmental Plan 1991. They were each affected by a transmission line easement 60.96 metres wide. The easement affected the front section of the Saad and Constantine property, the middle section of the Cook property and the rear corner of the Raguz property. The properties were located on the northeastern side of Windsor Road, between Annangrove Road and Box Road, within the Rouse Hill Development Area. Land on the southeastern side of Annangrove Road was zoned Industrial 4(b), being the Annangrove Road industrial estate.

6 This area was identified for future urban development in the late 1980's, specifically through Sydney Regional Environmental Plan No 19 - Rouse Hill Development Area. Under SREP 19, the properties were within the designated Living Area in the structure plan. The properties were not included in any release area under SREP 19, however. The properties are about 2 km northwest of the Rouse Hill regional centre contemplated by SREP 19. The Rouse Hill regional centre is an area of some 122 hectares set aside for a new regional centre, incorporating a regional shopping centre, educational precinct, about 1800 dwellings, and open space. In 2003, the joint venture between the Department of Planning, Landcom and Lend Lease for the development of the regional centre was announced.

7 In May 2004, the State Government released a "Ministerial Directions Paper - Metropolitan Strategy". The paper referred to "impending decisions" on land releases in the North West sector providing greenfield areas for new development. The paper foreshadowed a structure planning approach, with elements including, amongst other things, local employment opportunities. A discussion paper followed in September 2004.

8 The State Government released more specific proposals for the North West Growth Centre on 9 December 2004. The package included precinct plans for each sector, a draft structure plan and various fact sheets. The acquired properties were part of the North West Growth Centre identified. The parties agreed that, but for the proposed road upgrade, the whole of the acquired properties would have been within the Box Hill Industrial Precinct, designated for employment purposes (the upgrade caused a small sliver of the properties to be located within the proposed regional park). Fact sheet 1 referred to the need for local and regional jobs. Fact sheet 2 identified the first new land releases in the North West sector as North Kellyville, Riverstone and Alex Avenue, selected because of their access to water and sewer services, the upgraded Windsor Road, and other major road upgrades. It disclosed that land would be released by approval from Cabinet following consideration of recommendations by the Land Release Advisory Committee. The process foreshadowed the making of a State environmental planning policy to zone the precincts, with local environmental plans and precinct plans to be made for each area. Fact sheet 5 referred to development contributions in the context of residential (but not industrial/employment) development. Fact sheet 6 identified that a growth centres commission would be established to co-ordinate the releases and associated infrastructure provision.

9 Mr Player and Mr Sanders gave evidence about planning issues. Counsel for the parties acknowledged that the planning issues were of less significance than ordinarily the case, as these issues were largely subsumed by the comparable sales.

10 The main dispute between Mr Player and Mr Sanders concerned the timing of the release of the Box Hill Industrial Precinct, which in part depended on the availability of water and sewer services. Mr Player considered the available information at the acquisition date supported an inference that the Box Hill Industrial Precinct could be serviced earlier, rather than later, in the release process. Mr Sanders considered that the available information supported an inference of a staged release, with the Box Hill Industrial Precinct to be serviced and released after the areas at Alex Avenue, Riverstone, Riverstone East and Area 20. Area 20 is a small triangle of land adjacent to East Riverstone.

11 Mr Sanders did not consider that there was evidence of any particular demand for employment lands in the locality given the slow take up of the land within the Annangrove Road industrial estate. Mr Player considered the documents supporting the proposed releases of land disclosed the strategy of providing substantial employment areas for local jobs well in advance of actual demand. Mr Player and Mr Sanders agreed that the timing of the release and rezoning (rather than its ultimate occurrence) was speculative, given that the relevant planning processes were in their infancy at the acquisition date. Mr Player concluded that the release and rezoning might take from five to nine years. Mr Sanders concluded that, overall, the land may not be available for development for seven to eight years, with a best case of five years and a worst case of 10 to 15 years or even longer.

12 The views of the hypothetical buyer and seller about the development potential of the land are relevant (E J Cooper & Son Pty Limited v Baulkham Hills Shire Council (2003) 131 LGERA 226 at [9], referred to as "the correct approach" in Minister Administering the Environmental Planning and Assessment Act 1979 v Bautovich (2005) 142 LGERA 331 at [20] per Handley JA, Tobias JA and Brownie AJA agreeing. See also De Ieso v Commissioner of Highways (1981) 27 SASR 248 at 252). Whether the hypothetical parties to the transaction would have obtained expert advice is a question of fact. If they would have obtained such advice, then the expert opinions are relevant "through the judgment of the hypothetical buyer and seller" (De Ieso at 252).

13 In this case, I consider that the views of the hypothetical buyer and seller about the development potential of the properties are best ascertained through the comparable sales. Accordingly, I deal with the relevant aspects of the planning evidence in the context of the comparable sales.

14 In a statement of May 2006 with respect to the Raguz property, Mr Phippen assessed compensation (excluding disturbance) of $6,725,000 assuming a delay in release and rezoning of 5 years and $7,425,000 (excluding disturbance) assuming a delay in release and rezoning of 9 years. In other words, according to Mr Phippen, the property was worth more if the release and rezoning took longer. This resulted from Mr Phippen's adoption of a rate of $300 per sqm for industrial land, with a 7.5% pa discount for holding costs and charges, and guaranteed growth at a rate of 10% pa.

15 Mr Phippen subsequently prepared statements of evidence in each matter filed in November 2006. For each property, Mr Phippen applied the direct comparison method to determine a $ rate per sqm for the properties acquired. He did so taking into account the existing rural zoning of the properties and the proposed industrial zoning. He identified two sales of land fronting Windsor Road - 812 Windsor Road, Rouse Hill and 798 Windsor Road, Rouse Hill. 812 Windsor Road sold in May 2005 at a rate of $209 sqm (having an area of 20,350 sqm and a sale price of $4,250,000). 798 Windsor Road sold in April 2005 at a rate of $157 per sqm (having an area of 20,330 sqm and a sale price of $3,200,000). Both properties were zoned Rural 1(a) and were located in the North West Growth Centre, designated as Area 20. Mr Phippen described Area 20 as neither residential nor industrial in the draft structure plan, with its use yet to be determined. Accordingly, he considered Area 20 affected by greater uncertainty than the acquired properties.

16 Mr Phippen also analysed certain sales relied on by Mr Dempsey, including sales of land within the Box Hill Industrial Precinct. Those sales were: (1) 2 Nelson Road, Box Hill (a property with an area of 15,300 sqm, which sold in April 2004 at a rate of $112 per sqm): - Mr Phippen noted that this sale pre-dated the State Government's release of the proposals for the North West Growth Centre on 9 December 2004. Although this land was exposed to Windsor Road, he considered it inferior to the acquired properties in terms of location and exposure to flooding, observing that most of the land was more than one metre below the level of the surrounding roads, with evidence of flooding available from neighbours.

(2) 6 Nelson Road, Box Hill (a property with an area of 15,500 sqm, which sold in February 2005 at a rate of $123 per sqm): - Mr Phippen described this property as having an inferior location, on a quiet street with no exposure. He characterised it as low lying, with evidence of flood impacts available from neighbours.

(3) 8 Nelson Road, Box Hill (a property with an area of 19,830 sqm, which sold in January 2005 at a rate of $119 per sqm): - Mr Phippen repeated his comments about 6 Nelson Road.

(4) 27 Box Road, Box Hill (a property with an area of 12,730 sqm, which sold in November 2005 at a rate of $92 per sqm): - Mr Phippen made the same points about this property, including his observation that the land was all low lying (below road level), with a large part subject to flooding. Mr Phippen observed that the sale was a deceased estate, with the vendor in London. Marketing was restricted to the local area. He also noted that the market generally in the area was not as active by November 2005 as it had been earlier.

(5) 2 Nelson Road, Box Hill, 12 Alan Street, Box Hill, 36 Barry Road, Kellyville, 193 Cudgegong Road, Rouse Hill, and 156 Cudgegong Road, Rouse Hill: - Mr Phippen observed that all these properties were zoned Rural 1(a) but designated for future residential use under the draft structure plan for the North West Growth Centre and, thus, were not appropriate for comparison.

17 Mr Phippen then identified two sales of existing industrial land in the Annangrove Road estate as follows: (1) 340 Annangrove Road, Rouse Hill (a property with an area of 14,590 sqm, which sold in September 2004 at a rate of $288 per sqm): - Mr Phippen identified this as the only sale of industrially zoned land in the area. He described the property as in a poorer location but with an existing industrial zoning.

(2) 350 Annangrove Road, Rouse Hill (a property with an area of 16,530 sqm, subject to an option for purchase showing a rate of $363 per sqm): - Mr Phippen said he did not rely on this transaction as evidence of market value for the acquired properties, but to show increased demand flowing from the State Government's announcements about future uses.

18 Based on this analysis, Mr Phippen considered that the market for existing industrially zoned land was $300 per sqm and that the market would pay at least $205 per sqm for the acquired properties as land zoned Rural 1(a) absent any industrial potential and $250 per sqm as land zoned Rural 1(a) with industrial potential.

19 Mr Phippen also assessed the value of the severed land forming part of the Cook residue at a rate of $75 per sqm (or $171,000 for the severed area of 2,286 sqm). He said that the reduction in value of this portion was $515,000, but it is apparent that he calculated the before value of the severed land assuming a rate of $300 per sqm (that is, his rate for land with an existing industrial zoning).

20 Mr Phippen noted that the upgraded Windsor Road would be about 107 metres closer to the existing dwelling on the Cook property and 70 metres closer to the existing dwelling on the Saad and Constantine property. He considered the effect on the value of the residue by reason of increased noise and pollution difficult to quantify, but estimated the reduction in value of the Cook residue as $150,000 (or about $10 per sqm) and the Saad and Constantine residue as $125,000 (or about $7.50 per sqm).

21 Mr Phippen prepared statements in reply to Mr Dempsey's evidence filed in October 2006. In his replies, Mr Phippen noted that the purchasers of the Nelson Road properties had all intended to use their land for purely rural residential purposes, as those properties had no industrial potential, in contrast to the acquired properties. He also disagreed with Mr Dempsey's treatment of improvements on those properties on the basis that, if redeveloped for industrial purposes, the improvements would have to be removed. Mr Phippen disclosed a further sale of industrial property of which he had become aware - 352 Annangrove Road, Rouse Hill. This property (having an area of 18,190 sqm) sold in July 2005 for $4,450,000 (or $244.63 per sqm). On that basis, Mr Phippen adjusted his previous conclusions, although he considered this an inferior parcel to the acquired properties (albeit zoned industrial). He considered that the market evidence overall supported the following conclusions: (1) Rural home sites proposed industrial: - a range of $92 to $123 per sqm.

(2) Rural home sites proposed residential: - a range of $91 to $126 per sqm.

(3) Rural home sites proposed Area 20 (undetermined) - a range of $158 - $209 per sqm.

(4) Industrial land - a range of $245 - $363 per sqm.

22 Mr Phippen assessed the acquired properties as superior to the "rural home sites proposed industrial" sales as the acquired properties were flood free land with good exposure to Windsor Road. He considered the "rural home sites proposed residential" sales as immaterial given the different use proposed. He accepted that the market paid a premium for the existing industrial zoning of the "industrial land" sales. He considered the two Area 20 sales as the most comparable, as they were both on Windsor Road, with good exposure, albeit with an undetermined future use potential.

23 Having regard to all these circumstances, Mr Phippen concluded that the value of the acquired properties would have to be at least 50% above the top of the "rural home sites proposed industrial" sales (that is, $185 per sqm), at the top of the range of the Area 20 sales (that is, $210 per sqm), and 30% below the median of the "industrial land" sales (about $200 per sqm). He concluded that this analysis supported a value of $200 per sqm for the acquired properties. He referred also to two acquisitions of land fronting Windsor Road by the RTA - one of 10.3 sqm and one of 4,181 sqm, with the second sale said to support his conclusions.

24 Mr Dempsey also used comparable sales, applying the before and after method to the partial acquisitions of the Cook property and the Saad and Constantine property. He considered the response of the market to the future development potential of the acquired properties was "resolved by reference to market sales evidence in the Box Hill Industrial Precinct being sales of land currently zoned rural 1(a), but also having a higher and better use potential". These were the sales of land west of Nelson Road, referred to above. Mr Dempsey observed that the sales within Area 20 were directly opposite the Rouse Hill regional centre with a potentially higher future use than the acquired properties, albeit unknown. He assessed the vacant land values of the sales of land zoned Rural 1(a) in the Box Hill Industrial Precinct as between $92 and $105 per sqm, with improved values between $92 and $123 per sqm. He described the acquired properties as superior to the Box Hill Industrial Precinct sales by reason of proximity to Annangrove Road, but inferior by reason of the impacts on amenity caused by the transmission line easement. He said the sales he relied on disclosed that the market, at the acquisition date, was not paying any premium for the "unrealised use potential". Mr Dempsey also observed that the other land available for industrial development would affect the market for the acquired properties at the acquisition date, including the land within the Annangrove Road industrial estate.

25 Mr Dempsey assessed the market value of the acquired properties by reference to these considerations as $115 per sqm for the Raguz property (including the acquired improvements) and $100 per sqm for the Cook property and the Saad and Constantine property (where the existing dwellings were not resumed).

26 Mr Dempsey treated the severed portion of the Cook property as having no separate building entitlement and assessed its value at a rate of $35 per sqm, in the after acquisition situation.

27 Consistent with Mr Phippen, Mr Dempsey accepted that the residue land had been adversely affected by the Windsor Road upgrade, as the upgraded road was closer to the existing dwellings and the holdings had decreased in size and lost the capacity for a right hand turn onto Windsor Road as a result of the acquisition. He allowed $5 per sqm on account of this reduction in value of the residue for both the Cook residue and the Saad and Constantine residue.

28 In his evidence in reply, Mr Dempsey observed that the acquired properties were not prime land for industrial development, as they had a depressed area at their frontages and rose to the rear, whereas industrial developers generally preferred flat land. He thought the low-lying areas at the front of the acquired properties, on which dams were located, might have been subject to flooding. Mr Dempsey criticised many other aspects of Mr Phippen's analysis including his initial approach of discounting the assumed industrial value of the acquired properties (characterised by Mr Dempsey as an example of the "top down" method rejected by Biscoe J in Sandhurst Trustees Limited v Roads and Traffic Authority of NSW [2006] NSWLEC 243).

29 Mr Phippen and Mr Dempsey prepared two joint reports for each of the acquired properties, in which they reiterated their respective opinions. In the first joint report, Mr Dempsey identified additional sales of rural land showing a range of $81 to $113 per sqm, including improvements. Mr Phippen emphasised the demand for industrial land (by reference to a sale at Fyfe Road, Blacktown, considered immaterial by Mr Dempsey). Mr Phippen criticised Mr Dempsey for not having ascertained the actual motivations of the purchasers of the comparable sales. He rejected Mr Dempsey's assessment that Area 20 would be seen as likely to have a superior zoning than the acquired properties, as the future use of that area was unknown at the acquisition date. Mr Phippen noted that the purchasers of land west of Nelson Road did not realistically expect that this land would be released for industrial purposes (despite its designation as such in the draft structure plan) - and that had in fact proved to be the case as this land was removed from the Box Hill industrial Precinct after the acquisition date. Mr Phippen determined the rural value of the acquired properties absent any industrial potential as $180 per sqm, on the basis that the west of Nelson Road sales were acquired by purchasers for purely rural residential purposes, who did not expect the industrial release of that land. He stressed that those purchases paid $92 to $123 per sqm for these sales, whereas the acquired properties were flood free and in a better location. Mr Phippen considered this analysis supported his rate of $200 per sqm for the acquired properties given their industrial potential. Mr Phippen also modified his assessment of the severance claim with respect to the Cook property to $331,470 (based on a before value of $220 per sqm and an after value of $75 per sqm).

30 In the second joint report, both valuers repeated their respective positions yet again. Mr Phippen also provided additional information on the sale of 798 Windsor Road, Rouse Hill in Area 20, which he characterised as a "forced sale" as the dissolution of a partnership required the property to be sold immediately. The purchaser acquired the property on a speculative basis for a "bargain basement price". The purchaser had received a subsequent offer to purchase the land for some $6 million. The purchaser was not aware that of the proposed rezoning from rural, but considered it obvious that something would be happening in that area.

31 Mr Phippen provided similar additional information with respect to the purchaser's position on the sale of 812 Windsor Road, Rouse Hill, also in Area 20. He referred to three sales on Terry Road within Area 20 to support his opinion that the market paid a premium for Windsor Road frontage. The Terry Road sales within Area 20 (which did not have Windsor Road frontage) between July 2003 and April 2004 showed rates of $129 to $141 per sqm. Finally Mr Phippen noted that he had omitted the effect of the easement. For the Raguz property, this led to a reduced value of $180 per sqm for the easement area of 2,465 sqm. He did not consider any reduction appropriate for the Cook property or the Saad and Constantine property, because the easement was offset by the smaller size of these parcels.

32 Mr Phippen explained that he relied on the joint reports for his valuation analysis, not his earlier statements, which remained relevant only for their factual material. Mr Phippen clarified that the market perceived the land west of Nelson Road as simply too far removed from the existing industrial area at Annangrove Road to have any real likelihood of release for industrial purposes, despite their designation as part of the Box Hill Industrial Precinct in the draft structure plan at the acquisition date.

33 Mr Dempsey explained that the Area 20 sales on Windsor Road were directly opposite the proposed regional centre. It was public knowledge that before the acquisition date Landcom and Lend Lease had entered into a joint venture to develop the town centre, with about 65,000 metres of commercial floor space, an education precinct, low density and high density residential development, all to be constructed over 10 years. It was this factor that supported the speculative element in the sale of the Area 20 properties fronting Windsor Road, not the Windsor Road frontage per se or the North West Growth Centre information released in December 2004. Purchasers of the Area 20 properties fronting Windsor Road directly opposite the town centre would know that they could leverage their developments off the town centre. In contrast, the acquired properties were some kilometres away from the town centre development. Mr Dempsey did not consider Windsor Road frontage particularly significant for development of employment lands, in contrast to traditional retail development. Mr Dempsey did not agree that the sale of the deceased estate (27 Box Road, Box Hill) was out of line, because the selling agent was responsible for achieving the best sale price possible irrespective of the circumstances of the sale.

D. Decision about compensation (excluding disturbance) General observations

34 The definition of market value in s 56 of the Just Terms Compensation Act relates to the price which a buyer would give and a seller take for the land in all the relevant circumstances at the acquisition date, assuming the hypothetical buyer and seller are parties "…willing to trade, but neither of them so anxious to do so that [they] would overlook any ordinary business consideration", and both being "perfectly acquainted with the land, and cognizant of all circumstances which might affect … [its] value" (Spencer v The Commonwealth of Australia (1907) 5 CLR 418 at 441 per Isaacs J).

35 Comparable sales are the conventional technique to ascertain the market value of land. Adjustments are likely to be required, as "no two parcels of land are identical in all respects…Before using any allegedly comparable sale, therefore, the valuer must consider whether, having regard to the circumstances (using that word in its broadest sense) appertaining to the parcel of land in question, and to the transaction of sale, there are sufficient similarities to the circumstances appertaining to the subject land and to the notional sale presupposed by the test formulated in Spencer v Commonwealth (1907) 5 CLR 518" (Brewarrana Pty Ltd v Commissioner of Highways [No. 1] (1973) 32 LGRA 170 at 179-180 per Wells J). Wells J observed that the relevant circumstances in relation to the transaction of sale required the valuer to weigh such things as "the character, business and relationships of the parties, their motives, the terms and conditions in their contracts of sale, and any other special considerations that induced or may have induced them to conclude the contract at the selling price agreed…"(Brewarrana at 179-180).

36 In Roads and Traffic Authority (NSW) v Mosca (2006) 146 LGERA 335 at [15], Handley JA (with whom Mason P and Bryson JA) agreed) emphasised that: The basic principle of compensation law is that the land must be valued at the relevant date in its existing condition with all its potentialities as potentialities: Yates Property Corporation Pty Ltd (in liq) v Darling Harbour Authority (1991) 24 NSWLR 156 at 175-176; 73 LGRA 47 at 65-66 citing Raja Vyricherla Narayana Gajapatiraju v Revenue Divisional Officer, Vizagapatam [1939] AC 302 at 313 and Turner v Minister for Public Instruction (1956) 95 CLR 245 at 268-289.

37 Sales to acquiring authorities are not irrelevant, but should be treated with caution (Koutsouras v State Rail Authority of New South Wales unreported; NSWCA, 29 November 1991, Woollams v The Minister (1957) 2 LGRA 338 at 347, Tatmar Pastoral Company Pty Ltd and Anor v The Housing Commission of New South Wales, unreported, NSWLEC, No. 30115 of 1980, 17 March 1982, per Cripps J at 39 - 41).

38 Offers are not the same as comparable sales. There are many decisions about the difficulty of relying on offers as evidence of value, despite some capacity to do so (see, for example, the discussion in Alan Hyam, Valuation of Land in Australia, 3rd ed. at 92 - 99).

39 Where a genuine doubt relevant to value remains, that doubt should be "resolved in favour of a more liberal estimate" (Boland v Yates Property Corporation Pty Ltd and Another (1999) 167 ALR 575 at [356], citing Commissioner of Succession Duties (South Australia) v Executor Trustee and Agency Company of South Australia Limited and Others (1947) 74 CLR 358 at 373 - 374).

40 At the request of the parties, I undertook a comprehensive view of the acquired properties, the comparable sales and other aspects of the North West Growth Centre.

41 Mr Phippen treated the two sales within Area 20 as the most comparable, although he considered the circumstances of the sale of 798 Windsor Road equivalent to a forced sale given the financial distress of the vendor. I accept that the Area 20 sales are relevant. I also accept that the circumstances of the sale of 798 Windsor Road (arising from a dissolution of a partnership) should be taken into account. The primary difficulty with Mr Phippen's analysis of the two Area 20 sales was his refusal to accept the significance of the proximity of these sales to the Rouse Hill regional centre. Mr Phippen treated the sales as disclosing the premium paid for Windsor Road frontage, using the Terry Street sales to support this conclusion. The Terry Street sales within Area 20 did not have Windsor Road frontage, but also were not directly opposite the proposed regional centre.

42 A realistic appraisal of the Area 20 sales would have recognised certain significant advantages of those sites not enjoyed by the acquired properties.

43 First, the sales were directly opposite the proposed regional centre. Before the sale dates, the market knew the regional centre would be developed, constituting an integrated town centre, with a very large retail/commercial component (some 65,000 sqm), an educational precinct, and both high and low density housing. Although the purchasers interviewed by Mr Phippen did not know the designated future use of Area 20, the location of the sales directly opposite this proposed regional centre more than justified their view that it was "obvious" something would be happening within Area 20 to their considerable advantage.

44 Secondly, Area 20 (as the draft precinct plan disclosed) was surrounded by existing urban development other than on its western side. That fact, taken with the location of Area 20 relative to the proposed regional centre, would have suggested to the market a likely release of Area 20 earlier rather than later in the development of the North West Growth Centre. Although the information released by the State Government in December 2004 did not refer to an early release of Area 20 (but North Kellyville, Alex Avenue and Riverstone), the draft Precinct Plan shows Area 20 as a small triangle located between these areas. This location would have added weight to the inference that I am satisfied the market would have drawn at the sale dates - namely, that Area 20 was likely to benefit from a relatively early release compared to the proposed Box Hill Industrial Estate. The conflicting evidence of Mr Player and Mr Sanders about the significance of the markings on the various water and sewer diagrams and other documents does not affect my conclusion. The relevant issue in this regard is not the absolute date or order of the release, but the perceptions of the market about the likely timing of the releases of the various precincts relative to each other. The proximity of the acquired properties to the Annangrove Road industrial estate and the matters relied on by Mr Player to support his opinions, while relevant, were not of the same character or importance as those pertinent to Area 20.

45 Thirdly, although Mr Phippen rejected Mr Dempsey's evidence about the potential superior use of the Area 20 sale sites compared to the acquired properties (given the absence of any designation for uses within Area 20 at the dates of the comparable sale), I consider the location of Area 20 compared to the acquired properties supported Mr Dempsey's opinion. The submission to the contrary on behalf of the applicants by reference to the size of the proposed regional centre was not persuasive. Area 20 was clearly part of the North West Growth Centre, proposed for urban development. In the context of the location of Area 20, the absence of a specific designation would have been immaterial. I do not accept that the Terry Street sales lead to any different conclusion. The Terry Road sales and the sales on Windsor Road within Area 20 do not show the extent of the advantage of Windsor Road frontage, as the Terry Road sales are not located directly opposite the proposed regional centre. The Area 20 sales with Windsor Road frontage, in my view, disclose a premium paid (in large part) for land directly opposite the proposed regional centre, as well as the Windsor Road frontage and location within the North West Growth Centre. Factors necessary for the market to perceive the capacity to leverage development within Area 20 off the regional centre (as referred to by Mr Dempsey) included location within the North West Growth Centre and the associated future release of the land for urban development.

46 I do not accept Mr Phippen's approach to the range of relevant values for the acquired properties. His initial analysis resulted in the acquired properties being worth more the longer the delay in their release for urban purposes, which I do not consider tenable. He also deduced (initially at least) a rate of $300 per sqm for industrial land in the area, and $250 per sqm for the acquired properties. Thereafter, Mr Phippen became aware of the sale of 352 Annangrove Road at a rate of $245 per sqm. He then assessed a range of $245 - $363 per sqm for industrial land, $92 to $123 per sqm for rural home sites with proposed industrial use, and $158 - $209 per sqm for rural home sites proposed Area 20. Mr Phippen selected his rate of $200 per sqm for the acquired properties on the basis that they were at least 50% above the top of the "rural home sites proposed industrial" sales (that is, $185 per sqm), at the top of the range of the Area 20 sales (that is, $210 per sqm), and 30% below the median of the "industrial land" sales (about $200 per sqm). I deal with these propositions in reverse order.

47 I do not accept that the "median" of the industrial land sales is an appropriate criterion to adopt in assessing value. The sales of industrial land referred to by Mr Phippen showed rates of $245 per sqm and $288 per sqm. Taking the median assumed that the transaction reflecting $363 per sqm was relevant. In his initial statement, Mr Phippen said he did not rely on that transaction as an indicator of value for the acquired properties (presumably as the transaction involved an option, which I infer was subject to development consent being obtained). If the sale at $363 per sqm is disregarded, the figure of $200 per sqm is 30% below the highest relevant sale price for existing industrially zoned land and 22.5% less than the sale at 352 Annangrove Road (a site only about 200 metres to the east of the acquired properties, already in an industrial zone, and with comparable exposure to the acquired properties).

48 I do not accept that Mr Phippen's deduction of 30% had any meaningful relationship to the difference between land already zoned industrial and land zoned rural with a designation as part of the proposed Box Hill Industrial Precinct, to be released and rezoned some five years after the acquisition date (on the best possible view available). While the issue was the timing, rather than the fact of release and rezoning, Mr Phippen's approach (and the rate of $200 per sqm) did not appropriately reflect the fundamental principle that the acquired properties were to be valued at the acquisition date recognising their "potentialities as potentialities" (Mosca at [15]). This view is confirmed when the Area 20 sales are taken into account (although I accept the circumstances surrounding the sale of 798 Windsor Road contributed to a low $ rate per sqm in that case). 49 The notion that the acquired properties were equivalent to the top of the range of the Area 20 sales was untenable. For the reasons set out above, the Area 20 sales relied on by Mr Phippen were substantially superior to the acquired properties.

50 The assessment that the acquired properties were 50% better than the best of the rural proposed industrial sales (that is, the sales west of Nelson Road) was excessive having regard to all relevant circumstances. Mr Phippen's assessment also overlooked the value of the improvements on most of those sales, which I consider inappropriate when the sales are applied to the partial acquisitions.

51 Mr Phippen's analysis of the pure rural value of land in the area ($180 per sqm) was equally unpersuasive. Mr Phippen used the same sales west of Nelson Road and his analysis in this regard was virtually indistinguishable from his analysis of the rural proposed industrial sales. Mr Phippen's use of various acquisitions by the RTA and other acquiring authorities also did not, in my view, lend weight to his evidence. One of these acquisitions was of an area of 10.3 sqm. Another had an area of 4,181 sqm. Yet another had an area of 210 sqm. The one large site (some 35,000 sqm) was located on Windsor Road in the area that became Area 20 (albeit after that sale). I thus infer that this site was also quite close to the proposed regional centre and my comments above about this significant advantage apply.

52 Accordingly, I do not accept Mr Phippen's analysis with respect to the market value of the acquired properties.

53 I am satisfied that certain aspects of Mr Dempsey's conclusions require adjustment in order properly to reflect the value of the acquired properties. On the evidence, and resolving all doubts in favour of the applicants, I have reached the following conclusions relevant to Mr Dempsey's evidence.

54 I do not accept that the removal of the land west of Nelson Road from the proposed Box Hill Industrial Precinct after the acquisition date can be taken into account as confirmation of a foresight (Housing Commission of New South Wales v Falconer and Others [1981] 1 NSWLR 547 at 558). Accordingly, the sales west of Nelson Road after 9 December 2004 enjoyed the same designation as part of the proposed Box Hill Industrial Precinct as the acquired properties at the acquisition date. These sales, accordingly, are relevant for the reasons given by Mr Dempsey. Nevertheless, certain objective characteristics of the land west of Nelson Road would have been apparent to the market. Nelson Road separated those sales from the main core of the proposed Box Hill Industrial Precinct. The sales were in the proposed Box Hill Industrial Precinct but distant from the existing Annangrove Road industrial estate. Much of the land in this area was low lying, sufficiently below the level of surrounding roads to raise a question about flooding in the mind of an industrial developer (although I consider Mr Phippen overestimated the significance of this issue, particularly when it is also recognised that the acquired properties, as Mr Dempsey observed, were not flat land as traditionally favoured by industrial developers and were materially affected by the transmission line easement). These factors must be taken into account when determining the "proper place in the scale of values disclosed by the sales proved" of the acquired properties (Best v Housing Commission of NSW (1949) 17 LGR (NSW) 129 at 130). Although Mr Dempsey acknowledged that the location of these sales was inferior to the acquired land, I do not consider that he gave these more general considerations sufficient weight in his assessment. Instead, Mr Dempsey drew an inference from those sales that he sought to apply generally to the entire proposed Box Hill Industrial Precinct (namely, the unrealised potential arising from the 9 December 2004 announcements did not increase the value of land by the acquisition date). I do not consider that inference capable of application to the acquired properties, having regard to the relative advantage of their location compared to the land west of Nelson Road and the Area 20 sales.

55 Other factors also have to be taken into account with respect to the sales west of Nelson Road. The sale of 2 Nelson Road, Box Hill occurred before the release of the draft structure plan in December 2004. The sale sites at 6 and 8 Nelson Road, Box Hill had no direct exposure to Windsor Road. While I accept that this would have been an advantage for any person buying the sites for rural residential purposes, it would have been a disadvantage compared to the acquired properties for any buyer who wished to hold or ultimately develop the sites for their proposed employment designation at the sale date. The sale of 27 Box Road, Box Hill was not a forced sale as such, but should be treated with caution given the obviously lower sale price achieved than for the other sites west of Nelson Road and the known circumstances of the sale (namely, a deceased estate, with a vendor in London and a fairly limited marketing campaign). Mr Dempsey's dismissal of these factors by reason of the agent's obligation to obtain the best price possible on the day was inappropriate. The actual circumstances of the sale and the motivations of the buyer and seller are relevant factors that, if available, should be considered (see the observations in Brewarrana Pty Ltd v Commissioner of Highways [No. 1] (1973) 32 LGRA 170 at 179-180 per Wells J). With respect to 27 Box Road, Box Hill, the available information points to a low price being achieved as a result of the particular circumstances of the sale.

56 I accept Mr Dempsey's evidence that an allowance must be made for improvements on the comparable sale sites when compared to the Cook property and the Saad and Constantine property. The RTA acquired part only of those properties, not including the existing dwellings. In contrast, the RTA acquired the whole of the Raguz property, including the existing dwelling. I do not accept Mr Phippen's criticism of Mr Dempsey's allowance for improvements. Mr Phippen's primary thesis was that the sales west of Nelson Road were for rural residential purposes only. Mr Phippen contrasted those circumstances with the potential of the acquired properties, had they been sold on the acquisition date. Mr Dempsey, as noted, considered that the sales west of Nelson Road reflected the market's reaction generally to the announcements on 9 December 2004. Either way, the valuers' common position was that the Nelson Road sales reflected a rural residential value. The improvements were thus of value to the rural residential buyers and must be taken into account. Mr Dempsey's allowances for the value of improvements on each comparable sale were appropriately conservative, resolving doubts in the applicants' favour.

57 I accept Mr Dempsey's evidence that the transition line easement affecting the properties has to be taken into account. The release of the Box Hill Industrial Precinct, whether the evidence of Mr Player or Mr Sanders is accepted, was some years away. The transmission line easement was an obvious and material blight on the titles of the acquired properties, for both rural residential and employment purposes (albeit less of a constraint for the latter). The superiority of the acquired properties compared to the Nelson Road sales is tempered by the transmission line easement. I also prefer the method Mr Dempsey adopted to deal with this issue to that of Mr Phippen. Mr Dempsey assessed the easement as part of his overall consideration of comparability. Mr Phippen discounted $20 per sqm from the Raguz property limited to the area affected by the easement and said that any discount for the Cook and Saad and Constantine properties was unnecessary as "any discount would have to be balanced up with the usual premium paid for smaller parcels when compared to large parcels". The properties are not particularly small when considered with the comparable sales. The transmission line easement, as Mr Dempsey recognised, was a material affectation for which allowance must be made.

58 Although Mr Dempsey identified sales of land zoned Rural 1(a) designated for future residential development as part of the North West Growth Centre, I did not understand Mr Dempsey to suggest that those sales were of primary importance given the different designation of the acquired properties. The different designation is significant, as the markets for future residential and future employment lands are likely to have been different.

59 The market value of the acquired properties should reflect their overall advantage compared to the better sales west of Nelson Road, having regard to the relevant factors identified above (particularly, the differences in location with respect to Windsor Road frontage and proximity to the existing Annangrove Road industrial estate, the capacity for flooding, the transmission line easement, and slope). While the location of the acquired properties would have made them more attractive to the market for their future development potential as employment lands than the sales west of Nelson Road, the market would also have recognised that the timing of the release and rezoning of the acquired properties was uncertain, to be measured in years not months. The market value of the acquired properties should also reflect their substantial inferiority compared to the sales on Windsor Road within Area 20 for the reasons I have identified (accepting, however, that 798 Windsor Road was a low sale by reason of the particular sale circumstances).

60 The RTA acquired the whole of the Raguz property, including the improvements. Accordingly, the relative qualities of those improvements compared to the sales should also be taken into account for the Raguz property. I am satisfied that the improvements on the better sales west of Nelson Road, as analysed by Mr Dempsey, were sufficiently comparable to those which were on the acquired property for this purpose.

61 Having regard to these matters and my reasons above, I adopt a market value of $145 per sqm for the Raguz property. The same considerations apply to the Cook property and the Saad and Constantine property, other than the fact that the RTA did not acquire the existing dwellings. Having regard to that fact, and the value of improvements disclosed in Mr Dempsey's analysis, I adopt a value of $130 per sqm for these properties. These conclusions, in my view, appropriately reflect the overall advantages of the acquired properties compared to the better sales west of Nelson Road and their substantial inferiority compared to the sales on Windsor Road within Area 20 (even allowing for the low sale at 798 Windsor Road). They are also consistent with my assessment of the significance of the aspects of Mr Dempsey's analysis that I did not accept (resulting in an increase of $30 per sqm above Mr Dempsey's conclusions for each of the acquired properties).

62 The upgrading of the Windsor Road also affected the residue of the Cook property and of the Saad and Constantine property. Section 55(f) provides that compensation is to be assessed having regard to "any increase or decrease in the value of any other land of the person at the date of acquisition which adjoins or is severed from the acquired land by reason of the carrying out of, or the proposal to carry out, the public purpose for which the land was acquired". Mr Phippen allowed $150,000 for the Cook residue (or about $10 per sqm, excluding the severed land) and $125,000 for the Saad and Constantine residue (or about $7.50 per sqm). Mr Dempsey allowed $5 per sqm for both properties. The main relevant impacts are to rural residential amenity (visual and acoustical) from the road being closer and at a lower level relative to the dwellings than the original Windsor Road, with the additional impact of the absence of a right hand turn into Windsor Road. Excluding the latter issue, those matters would not, in my view, be material to the future development of the properties pursuant to their employment lands designation as part of the North West Growth Centre.

63 Having regard to the appearance of the upgraded road and its location and the future employment lands designation, I consider Mr Dempsey's allowance under s 55(f) for the Cook property and the Saad and Constantine property appropriate. The RTA disavowed any reliance on s 61 of the Just Terms Compensation Act, which was referred to in its written submissions. This was appropriate. Recognising the existing potential of the acquired properties by reason of their designation for employment purposes as part of the North West Growth Centre does not trigger the application of s 61 of the Act.

64 The acquisition of part of the Cook property also resulted in the residue land being severed. Section 55(c) provides that compensation is to be assessed having regard to "any loss attributable to severance" (defined in s 58 as "the amount of any reduction in the market value of any other land of the person entitled to compensation which is caused by that other land being severed from other land of that person"). I am satisfied that Mr Dempsey's approach (allowing $35 per sqm for the severed portion in the after acquisition situation) should be adopted for the reasons he gave.

65 Consistent with my findings above, the following assessments represent the amount of compensation that will justly compensate the applicants for the acquisitions of their properties, excluding their claims on account of disturbance and rights to statutory interest:

Raguz proceedings: (20,230sqm x $145 per sqm) $2,933,350.00 Agreed solatium $20,615.00 Compensation excluding disturbance and statutory interest $2,953,965.00

Cook proceedings: Before Acquisition $2,750,670.00 (21,159sqm x $130 per sqm)

After acquisition (14,540sqm x $125 per sqm) $1,817,500.00 (2,286sqm x $35 per sqm) $80,010.00

Less total after acquisition $1,897,510.00 Compensation excluding disturbance and statutory interest $853,160.00

Saad and Constantine proceedings: Before Acquisition $2,729,480.00 (20,996 sqm x $130 per sqm)

Less after acquisition $2,112,500.00 (16,900sqm x $125 per sqm)

Compensation excluding disturbance and statutory interest $616,980.00

66 Certain claims of loss attributable to disturbance were agreed between the parties. I deal only with the claims in dispute.

67 The Raguz property had garden areas in which there were a number of trees and areas used to grow fruits and vegetables. Mr Raguz enjoyed maintaining these gardens and used to sell the fruits and vegetables at a roadside stall and at markets. Over a period of 30 years, Mr Raguz improved the soil on the property to facilitate the growth of these fruits and vegetables. Mr and Mrs Raguz claimed an amount of $47,778 as the replacement cost of their plants and trees on the basis that when they acquired a replacement home, Mr Raguz would establish a new fruit and vegetable garden. They also claimed $80,000 representing the amount Mr Raguz estimated he had spent over the 30 year period improving the soil quality of the property. Senior counsel submitted that these facts were analogous to those in Director of Buildings and Lands v Shun Fung Ironworks Ltd [1995] 2 AC 111, although the claim was made under s 59(f) of the Just Terms Compensation Act (which refers to "any other financial costs reasonably incurred (or that might reasonably be incurred), relating to the actual use of the land, as a direct and natural consequence of the acquisition"). Senior counsel also accepted that the claim for $80,000 would have to be reduced, recognising the way in which the estimate had been made. Counsel for the RTA submitted that the case had never been articulated as involving any form of business loss, and that none of the evidence enabled any meaningful quantification of recoverable losses attributable to disturbance on this ground (a submission that I accept).

68 One difficulty with these claims is that they represent money spent by Mr Raguz on the acquired property over many years. As such, the estimates bore no necessary relationship to any financial cost Mr and Mrs Raguz might reasonably incur relating to the actual use of the land, as a direct and natural consequence of the acquisition. Contrary to the submissions on behalf of Mr and Mrs Raguz, I do not see this matter as analogous to the considerations articulated in Shun Fung (at 125). Even if the claim is recast as one with respect to a future financial cost (in contrast to an estimate of past expenditure), there are significant difficulties. Section 59(f) incorporates qualifications of reasonableness, causation and remoteness. The evidence in this case is insufficient to enable me to conclude that any financial costs Mr Raguz might incur in planting a new garden when he and his wife replace their residence satisfy these qualifications. The evidence was also insufficient for me to estimate those costs (if any), as I do not accept that they would have had any necessary relationship to the estimates provided. Finally, there was force in the RTA's submission that assessing the market value of the property as a rural residential home site with future development potential by reason of is designation as employment lands incorporated all of its advantages and disadvantages, including the amenity added by the gardens. For these reasons, I do not consider that these claims for loss attributable to disturbance should be upheld.

69 Mr and Mrs Raguz claimed $3,300 as the cost of excavating a dam for irrigation and livestock. After the acquisition, Mr and Mrs Raguz temporarily moved to another property they owned, but which they had given to their son. This property (unlike the acquired property) had no dam for livestock, so Mr Raguz had a small dam constructed at a cost of $3000 (excluding GST). The RTA submitted that the value of the dam on the acquired property was subsumed by the overall market value (which I accept) and the value of the newly constructed dam would add to the market value of the property held by Mr and Mrs Raguz's son (which I also accept). I do not consider these facts undermine the claim on account of this item, however. I am satisfied on the evidence that Mr and Mrs Raguz owned livestock, which they maintained on the acquired property, including by use of the dam. By reason of the acquisition they were forced to move and thus lost access to their dam. To keep the livestock alive, they constructed a new dam on the other property. They were entitled to compensation for both the full market value of the acquired property and the actual financial cost they incurred in taking the reasonable step of constructing a small dam to keep their livestock alive in the interim. The cost of constructing the dam is within the scope of s 59(f).

70 Mr and Mrs Raguz intend to buy a replacement property as soon as they find a suitable one. They claimed an amount on account of stamp duty, legal costs and agent's commission (to be calculated in accordance with the market value of the acquired property as I have determined). The RTA accepted the claim for stamp duty having regard to s 59(d) of the Just Terms Compensation Act ("stamp duty costs reasonably incurred (or that might reasonably be incurred) by those persons in connection with the purchase of land for relocation (but not exceeding the amount that would be incurred for the purchase of land of equivalent value to the land compulsorily acquired)"). Counsel for the RTA submitted that the claims for future legal costs and agent's commission were outside the scope of s 59, having regard to the careful distinctions between the sub-sections with respect to costs that must have been reasonably incurred to be recoverable and costs that are recoverable if they have been reasonably incurred or might reasonably be incurred. Counsel for Mr and Mrs Raguz submitted that the distinctions were immaterial, having regard to the function of s 59(f) as a "catch-all" provision (Fitzpatrick Investments Pty Limited v Blacktown City Council (No 2) (2000) 108 LGERA 417 at [20]).

71 I accept that Mr and Mrs Raguz intend to buy a replacement property. They lived on the acquired property. They have temporary accommodation on the property they gave to their son due to his relocation interstate. However, they need to, and intend to find, a property suitable to be their new home. In so doing, I accept that they will incur financial costs in the form of legal fees. They may or may not incur fees by way of an agent's commission, depending on the circumstances.

72 I do not accept the RTA's approach to the construction of s 59(f). First, it is apparent that the sub-sections are not mutually exclusive; disturbance items may be covered by more than one sub-section but, of course, are recoverable once only. Secondly, the RTA's approach is a version of an expressio unius argument (which courts generally approach with caution) - namely, as legal costs are expressly dealt with in s 59(c) and stamp duty in s 59(d), it necessarily means that there is an implied exclusion of legal costs from s 59(f). However, it is apparent that s 59(c) covers financial costs in fact incurred in connection with relocation generally. Section 59(d) covers stamp duty incurred or that might reasonably be incurred with respect to one aspect of relocation - the purchase of land for relocation. Section 59(f) has its own qualifications (of reasonableness, causation and remoteness, identified above). I can see no reason in principle to exclude from s 59(f) other financial costs (be they legal or of some other character) which meet the qualifications in that provision, by some negative connotation derived from the other provisions. I am satisfied that legal costs associated with the intended acquisition of the replacement property are within the scope of s 59(f). I do not consider the claim for agent's commission of the same nature. The claim is speculative. An agent's commission may or may not have to be paid. As such, I am not satisfied on the evidence that this claim is within the scope of s 59(f).

73 Mr and Ms Raguz claimed valuation fees under s 59(b) of the Just Terms Compensation Act ("valuation fees reasonably incurred by those persons in connection with the compulsory acquisition of the land"). The RTA accepted that they should be compensated for one set of valuation fees (from MJ Wilson in the amount of $9,680), but contested another set from Abbots Valuers, relating to a valuation carried out by Mr Phippen in April 2005 (in the amount of $21,190.07). The RTA contended that two lots of valuation fees were unreasonable and that the quantum of Mr Phippen's fees was excessive and unreasonable. One difficulty with the RTA's proposition is that nothing was put to Mr Phippen suggesting that his fees were unreasonable or to Mr Raguz suggesting that his conduct in obtaining two valuations was unreasonable. Another more general difficulty is that the whole of the Raguz property was acquired, forcing them to relocate from their family home after more than 30 years. In those circumstances, I do not draw any inference adverse to Mr and Mrs Raguz about the reasonableness of obtaining the two valuations or the amount of Mr Phippen's fees.

74 For these reasons, Mr and Mrs Raguz are also to be compensated for loss attributable to disturbance as follows: (1) Agreed relocation costs $22,000

(3) Stamp duty and legal costs on replacement property to be determined

(5) Agreed legal fees incurred $6,748.55 (in total)

Total for disturbance excluding stamp duty and legal costs of purchase $65,118.62

75 Mr and Mrs Cook claimed $5,200 on account of damage to their dam they contend was caused by the RTA using a heavy vibrating compactor immediately outside the boundary of their property. This, they say, caused the walls of their dam to crack. They were aggrieved by many aspects of the RTA's handling of their complaints about this issue, which I do not find it necessary to record. Counsel for the RTA submitted that the claim was excluded by the terms of a deed entered into by Mr and Mrs Cook and that the claim was otherwise unsound because the dam apparently continues to function adequately, never having (to date at least) leaked a drop. Mr Cook was concerned, however, that the dam has not been full since the damage occurred so that he did not know "whether the whole lot's going to collapse or not". On the evidence, I am not satisfied that these circumstances fall within any recognised category of loss attributable to disturbance. In particular, it seems to me to be speculative that the functionality of the dam has been affected, given that it has continued to operate more than adequately to date. I do not accept that the costs of repairing cracking to the dam (even assuming the RTA to have caused the cracking) are within the scope of s 59(f), and thus do not need to resolve the dispute about the deed.

76 Mr and Mrs Cook claimed $5,010.00 on account of the cost of erecting certain earth walls intended to improve the amenity of their property from the perceived increased noise impacts from the upgraded Windsor Road. Mr Cook said that, after he erected these walls, the RTA altered the level of the road, which rendered the walls worthless for the purpose of noise attenuation. The earth walls are part of the residue retained by Mr and Mrs Cook. Whether or not Mr and Mrs Cook perceive the walls as performing their intended noise attenuation function, they determined to make this improvement to the residue and retain the value of this improvement. If this is not a complete answer to this claim, then the claim faced other difficulties. Given that Mr Cook perceived the earth walls to be useless by reason of the RTA's change of design, I infer that the walls must have been constructed before the final design of the road upgrade was adopted and before the works were complete. Pre-emptive action may well be reasonable in some circumstances, but I am not satisfied on the evidence that this cost was reasonably incurred as a direct and natural consequence of the acquisition within the scope of s 59(f). The same reasoning applies to the claims for the purchase and planting of trees to improve the amenity of the retained land (claim of $1,418.33), the associated wire netting (claim of $134.70), the irrigation (claim of $1,084.29) and the additional works to the noise abatement banks (claim of $14,205.40). These were all decisions made by Mr and Mrs Cook about improvements to their residue land. The improvements add value to the residue land, which Mr and Mrs Cook retain. The decisions they made about these improvements were personal decisions, presumably informed by their own particular objectives. I am not satisfied on the evidence that any of these costs were reasonably incurred as a direct and natural consequence of the acquisition within the scope of s 59(f).

77 Mr and Mrs Cook claimed $7,806 on account of replacement fencing. The RTA submitted that it was in the process of replacing the fencing. Mr Cook, who is in the building industry, was not satisfied with the RTA's work (and, according to Mr Jones on behalf of the RTA, at least one round of fencing undertaken by the RTA was sub-standard). Section 64 of the Just Terms Compensation Act provides that a person and the authority of the State may agree on compensation being provided wholly or partly in the form of land or of the carrying out of works. Section 64 depends on an agreement between the parties. Without recording the unhappy history of the dealings between the Cooks and the RTA about replacing the fencing on the property, it is sufficient to observe that, whatever may have once been the position, Mr and Mrs Cook no longer agree to the RTA providing fencing on their behalf. Mr and Mrs Cook want the monetary compensation so they can replace their fencing to a standard they consider adequate. Although Mr Jones was of the opinion that the new fencing work was to the requisite standard, Mr Cook disagreed.

78 I am satisfied that the RTA has had adequate opportunity before the hearing to carry out and complete any agreed fencing to the residue land to an appropriate standard. Mr Cook's concerns about the fencing were cogent and reasonable. The quote for $7,806 also seems reasonable in all the circumstances. Accordingly, I consider that the claim on account of replacement fencing in the amount of $7,806 is a cost that Mr and Mrs Cook might reasonably incur, relating to the actual use of their land, as a direct and natural consequence of the acquisition within the meaning of s 59(f).

79 Mr and Mrs Cook claimed $588.60 on account of the fact that the Council served them with a separate rate invoice for the severed part of the residue land. The RTA submitted that the whole amount was not recoverable as the rates notice disclosed rates had gone up generally by some amount. Doing the best I can on the evidence, I am satisfied that the majority of this financial cost incurred is within s 59(f). I propose to allow $500 on account of this item.

80 Mr and Mrs Cook claimed three lots of valuation fees ($4,400 for MJ Wilson, $8,290.37 for Mr Phippen and $4,000 for Mr Furney). In the ordinary course, I would have accepted the RTA's submission that engaging three valuers for this partial acquisition was excessive and unreasonable. However, Mr Cook explained that the first valuer was not willing to come to the Court to give evidence, the second valuer became extremely ill and was unavailable to continue, and, as a result, they had to retain a third valuer, Mr Phippen. In these particular circumstances, I do not consider the claims on account of valuation fees unreasonable - either in terms of number or quantum.

81 For these reasons, Mr and Mrs Cook are also to be compensated for loss attributable to disturbance as follows: (1) Fencing $7,806

(4) Council rates $500 Total for disturbance $33,631.97

82 Mr Saad and Ms Constantine claimed $15,172 on account of fencing the RTA removed as part of the upgrade to Windsor Road. Unlike Mr and Mrs Cook, I did not understand Mr Saad and Ms Constantine had any concern about the quality of the fencing work undertaken by the RTA thus far, but the fencing remained incomplete. The RTA submitted that there should be no monetary compensation as it was carrying out the fencing work and intended to complete it. One difficulty is that Mr Saad and Ms Constantine did not dispute that part of the fencing work had been satisfactorily completed, whereas the claim for $15,172 related to the cost of the fencing work as a whole. While I would ordinarily do the best that I could on the evidence to resolve this claim by determining the monetary compensation irrespective of the RTA's intentions (on the same grounds as set out above with respect to the claims of Mr and Mrs Cook), the Saad and Constantine proceedings are different for two reasons. First, I do not understand that they object to the RTA completing the fencing (but wish it to be done quickly). Secondly, there are issues associated with a culvert (addressed below) that both parties accept I cannot resolve immediately. For this reason, I propose to reserve the issue of compensation for the fencing to allow the RTA to complete the works.

83 Mr Saad and Ms Constantine claimed $14,273 for the costs associated with construction of a new dam on their residue land. The acquisition took part of the existing dam on the property. In the last three months, the RTA has constructed a culvert that drains water directly into the retained part of the dam. Mr Saad and Ms Constantine have not agreed to this use of their dam for the purposes of general drainage associated with the road upgrade. As this situation only became apparent within the last three months, it did not form part of their original claim in the proceedings. They sought to amend their claim during the hearing to include the adverse impacts on the residue caused by the culvert draining water into their dam. Counsel for the RTA submitted that the grant of leave to amend the claim should be deferred as the RTA intended to acquire the whole of the remaining dam. I am not satisfied that I am able adequately to resolve the claim relating to the dam replacement in these proceedings, because the need to replace the dam is partly affected by the alleged impacts on water quality associated with the RTA having designed the road drainage works to enable a large culvert to drain directly into land still privately owned. I consider that the claims relating to the relocation of the dam and the impacts to the residue associated with the culvert, in fairness to all parties, should be reserved.

84 Mr Saad and Ms Constantine claimed $22,523 for the cost of sealing their driveway. It was apparent from the evidence that their driveway was not sealed before the acquisition. Their claim was based on their understanding of what the RTA had agreed to do. While the RTA had carried out some sealing works, they were said to be sub-standard and not within the spirit of the agreement. For its part, the RTA considered that it had done what it agreed to do. I do not accept that this claim fits within any statutory head of compensation. The property did not have the benefit of a sealed driveway before acquisition. Insofar as the driveway is concerned, there has been a slight improvement after acquisition. Wherever the merits might lie between the parties with respect to the agreement, its enforceability, terms and spirit, the cost of sealing the driveway is not within the scope of s 59(f) or any other provision of the Just Terms Compensation Act.

85 Mr Saad and Ms Constantine claimed $32,272 for the construction of new gates at the front of their property. This claim related to the full cost of these works. However, the RTA had constructed part of the works sought by Mr Saad and Ms Constantine and, insofar as they went, these works were to their satisfaction. However, the gates and associated electronic equipment have not yet been installed and the RTA subsequently unilaterally deleted an additional column and extension of the wall from the works, which Mr Saad considered representatives of the RTA had agreed would be constructed. Mr Jones on behalf of the RTA agreed that the extended wall and additional column had been shown on the sketch plan submitted to Mr Saad, but did not accept that any binding agreement had been reached about the extent of the works. The RTA had subsequently instructed the contractors to delete the additional column and extension of the wall from the works on Mr Saad's property, apparently on the ground that they would extend into the road reserve (possibly in anticipation of the foreshadowed second acquisition). I am not satisfied on the evidence that this claim, insofar as it relates to the additional column and wall extension, falls within any statutory head of compensation. In particular, I do not accept that Mr Saad and Ms Constantine might reasonably incur some cost relating to those works as a direct and natural consequence of the acquisition. I am also not satisfied that I can make any meaningful adjustment to the claim of $32,272 when so much of the work has been completed, the RTA has indicated its preparedness to complete the work that it is in the middle of carrying out, and Mr Saad and Ms Constantine have no complaint about the quality of the work to date. In the particular circumstances of these proceedings, I propose to reserve the position of the parties with respect to the completion of the works associated with the gates identified in Exhibit 22 (Mr Jones' affidavit), excluding any claim relating to the additional column and wall extension to the current boundary, which I do not accept.

86 Mr Saad and Ms Constantine claimed $67,960 on account of the relocation of their existing shed. This claim was originally made on the ground of lack of security given the relationship between the shed and the upgraded road. Later, the potential impacts on the shed caused by drainage from the culvert were raised. Consistent with the position adopted above about the culvert, I propose to reserve the position of the parties with respect to the culvert's impacts on the residue land, including the shed. However, I can determine the claim for relocation of the shed on the other grounds immediately. Mr Saad was concerned that, before acquisition, the shed was 100 metres from the boundary. After acquisition, he described the shed as 5 metres from the boundary, and lacking the necessary security from thieves and vandals to allow him to secure anything of value in the shed (whereas, previously, he had stored agricultural equipment in it). He agreed the shed had not been broken into to his knowledge. He agreed the shed was on the other side of the dam. I do not accept that the proximity of the shed to the new boundary by reason of this acquisition so affects the security of the shed as to make it reasonable to relocate it further within the residue. Leaving aside the culvert issue, the shed remains on the residue, available for use. I am not satisfied that costs associated with relocation of the shed might reasonably be incurred as a direct and natural consequence of the acquisition.

87 Mr Saad and Ms Constantine claimed $200 on account of the cost they incurred in obtaining a quote from a contractor to carry out some of the other works to which I have referred. Mr Saad and Ms Constantine paid for the quote. I infer that the quote covered some of the works that are presently being completed by the RTA. In those circumstances, I consider that this claim falls within s 59(f). They claimed the same amount relating to a quote from an engineer relating to the culvert, although they could not locate a copy of this document. I do not consider the evidence with respect to this claim adequate and, accordingly, do not accept it.

88 Mr Saad and Ms Constantine claimed $17,500 to replace certain trees that had been located on part of their property acquired by the RTA. The RTA agreed to a request by Mr Saad to relocate those trees to the front of his residue land. The RTA did so, but Mr Saad considered that the RTA's conduct in so doing resulted in the death of the trees. He said that had he known the RTA would not do the relocation properly, he would have done the job himself. I do not accept that any part of this claim is recoverable under the statutory heads of compensation. The trees were on land acquired by the RTA. Mr Saad and Ms Constantine did not "lose" the trees by reason of the RTA's apparently failed attempt at relocation, but by reason of the acquisition. Mr Saad and Ms Constantine will receive market value for the acquired land. The relocation was an arrangement between the RTA and Mr Saad, the failure of which does not sound in compensation under the Just Terms Compensation Act.

89 Mr Saad and Ms Constantine claimed two lots of valuation fees (MJ Wilson in the amount of $4,000 and Mr Phippen in the amount of $6,406.62). They retained Mr Phippen after they became aware that the first valuer was not willing to be a witness in Court proceedings. In these circumstances, I do not accept the RTA's position that the claim for the second valuer is unreasonable per se or in amount.

90 For these reasons, Mr Saad and Ms Constantine are also to be compensated for loss attributable to disturbance as follows: (1) Cost of quotation $200

(5) Front gates Parties' positions reserved, excluding claim relating to additional column and wall extension

(6) Construction of new dam Parties' positions reserved

(7) Impacts of culvert on residue Parties' position reserved

91 The findings above lead to the following determinations of compensation in accordance with the Just Terms Compensation Act, excluding statutory interest. Raguz proceedings Compensation other than disturbance $2,953,965 Disturbance excluding stamp duty and legal costs on replacement property $65,118.62 Cook proceedings Compensation other than disturbance $853,160 Disturbance $33,631.97 Saad and Constantine proceedings Compensation other than disturbance $616,980 Disturbance excluding reserved items $16, 791.97 92 Issues relating to statutory interest and costs may be capable of resolution between the parties. I propose to direct the parties to file with my Associate agreed or competing orders reflecting my decision within 14 days, but will hear from the parties with respect to the terms of the directions that should be made, particularly with respect to the Saad and Constantine proceedings. ****************************

04/04/2007 - Replace figure $616,900 with the correct figure of $616,980 - Paragraph(s) 65, 91

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