DBW REYNOLDS PTY LTD as trustee for THE DBW REYNOLDS FAMILY TRUST -v- PUBLIC TRANSPORT AUTHORITY [2023] WASC 165 (22 May 2023)

1. Unfortunately, this aerial photograph does not reveal the six different lots comprising the mostly black bordered location. These six taken lots are discernible, however, from another diagram set out below - taken from page 17 from the expert report of Mr Dale Hall of 22 August 2019 (exhibit 27). Mr Hall was one of the defendant's two property valuers who provided expert evidence at the trial.

1. The six lots comprising DBW's land came to be compulsorily acquired under the taking order of late 2015.
2. Because the compulsory acquisition was for purposes of a railway that was authorised by an Act of the Parliament of Western Australia ('Parliament') (namely for the Forrestfield-Airport rail link, the subject of the Railway (Forrestfield-Airport Link) Act 2015 (WA)), it was undisputed at the trial that the specific terms of s 241(2)(a) of the Land Administration Act 1997 (WA) (as amended) ('LAA'), are engaged.
3. By the express terms of s 241(2)(a) of the LAA, regard is to be had to the 'value of the land' with any improvements or the interest of any claimant in the land - assessed on 'the first day of the session of Parliament in which the Act was introduced'. The relevant session of Parliament is the 39th Parliament which commenced on 11 April 2013. It is therefore the April 2013 date that must be the relevant valuation date for the land - by force of s 241(2)(a) of the LAA. That was fully accepted on both sides at trial.
4. Consequently, 11 April 2013 is the agreed valuation date for the taken land, notwithstanding that the as introduced Railway (Forrestfield-Airport Link) Bill 2015 (WA) did not become law until some 30 months later. The reason for this curiosity concerning land compulsorily acquired for railway purposes is historic and does not need to be addressed further. The legislation is explicit on the valuation date.
5. The taking order registered at Landgate on 11 November 2015 states that the land was resumed for purposes of 'Public Transport facilities in connection with a railway as authorized by the Railway (Forrestfield-Airport Link) Act 2015'.

1. What follows below are largely the uncontroversial agreed facts taken from the out of plaintiffs' submitted trial chronology of 15 September 2022. It became exhibit 35A in the trial.
2. The plaintiffs' fact chronology for trial was responded to by the PTA and was mostly agreed with - subject to a small number of identified corrections and insertions as are found in the reply of 19 September 2022 (see exhibit 35B).
3. Amalgamating these exchanged chronology documents towards those respectively agreed facts, as clarified, generates below my assembled and mostly uncontroversial facts, which I have re‑numbered below (along with some added accompanying observations of my own to assist):

The second plaintiff (Century West) enters into a lease with the first plaintiff (DBW) with regard to the subject land.

First day of the session of Parliament which introduced the Railway (Forrestfield-Airport Link) Bill 2015 (WA).

The applicable valuation date for the compensation claim for the purposes of s 241(2)(a) of the LAA.

The Railway (Forrestfield-Airport Link) Act 2015 (WA) is passed into law upon receiving royal assent.

Registration of the taking order against the taken land at Landgate.

The interests of the first and second plaintiffs in the subject land are terminated and converted into claims for statutory compensation.

The first and second plaintiffs lodge respective claims for compensation.

The defendant (PTA) makes an offer of compensation to the first plaintiff in the sum of $6,900,000.

The first plaintiff rejects that offer of compensation, but requests an offer of an advance payment.

The second plaintiff enters into a lease over 415 Dundas Road, High Wycombe.

The defendant makes an offer of compensation to the second plaintiff in the amount of $23,200

Commencement date of the second plaintiff's lease of premises at 415 Dundas Road, High Wycombe.

The defendant renders an advance payment to the first plaintiffs' mortgagee (Westpac) in the sum of $3,645,000 plus a separate sum to the first plaintiff of $4,094,720.55.

The total compensation sum advanced to the benefit of the first plaintiff by the defendant was therefore $7,739,720.55 at this time.

The second plaintiff rejects its offer of compensation

The defendant makes an advance payment by a cheque for $25,872.39 to the second plaintiff.

The first plaintiff takes steps towards pursuing a proposed purchase of longer term replacement premises at 2 Harrison Road, Forrestfield (but the acquisition does not ultimately proceed).

Westpac Bank declines finance for a proposed purchase of premises at 2 Harrison Road, Forrestfield, by the first plaintiff.

Variation of the lease over 415 Dundas Road, High Wycombe extending the lease term for the second plaintiff.

Original end date of the initial term of second plaintiff's lease of the premises at 415 Dundas Road, High Wycombe.

Variation of lease over 415 Dundas Road, High Wycombe extending term again for the second plaintiff.

The first plaintiff alleges it 'reinvested' part of the advanced moneys received into acquiring a 'replacement' investment property of 14 Dupuch Close, Eagle Bay, which was land purchased then in the names of Haydn and Leida Reynolds.

The defendant's response to this suggested fact disputes any characterisation of the agreed purchase as being a 'reinvestment', or an 'acquisition' by the first plaintiff.

The defendant accepts Haydn and Leisa Reynolds did acquire a property at 14 Dupuch Close, Eagle Bay, on or about this day.

During the course of trial, I was told the property at Eagle Bay had been a vacant block without any residence or dwelling then built upon it, but that later, a residence was constructed by Mr and Mrs Reynolds - with the land and residence then at Eagle Bay being used as a holiday home (see ts 110).

The defendant offers advance payments to first and second plaintiffs (accepting the correction offered under the defendant's reply to the chronology at par 2.5):

Additional amount to the first plaintiff $1,180,000

Defendant pays the first plaintiff a further $1,635,764.49.

Defendant pays the second plaintiff a further $239,654.91.

1. By the written outline of opening submissions of the defendant of 27 September 2022 (folio 88) nine issues were identified therein - and they all came essentially, to be agreed with at the opening of the trial by counsel for the plaintiffs as correctly stating the core issues presenting for determination in the trial. I mention them all briefly in turn next. Some, such as issues five and nine, can be resolved immediately.
2. Issue one. DBW, as the affected landowner, claims it is entitled under s 241(2) of the LAA to a higher compensation amount representing the value of its taken land assessed to include value 'to the owner', being a sum higher than the land's market value. The PTA disagrees. It submits that while 'value to the owner' is a common law principle sometimes found referred to in compulsory acquisition cases, it does not bear the meaning as is contended for by the plaintiffs. The PTA says that for the facts of this case and on the application of the LAA, 'value to the owner' is not a principle to which the expert land valuers in the trial may permissibly have regard.
3. That, says the PTA, is the position, even if the two incorporated plaintiffs are viewed for present statutory compensation purposes, as one 'operation', and with them together making a 'global claim' for compensation. The PTA duly responds that a sum of compensation for market value (under s 241(2) of the LAA) to DBW and for any legitimate claims of Century West for its loss or damage under s 241(6) of the LAA - will provide all the permissible 'value to the owner' for the taken land.
4. Issue two. What is the market value of the land (including improvements)? Here, the agreed valuation date, by s 241(2)(a) of the LAA, is 11 April 2013. The PTA submits that based on the expert property valuation evidence put before the Court, this amount is no more than $8,500,000. DBW disagrees and says the correct amount is higher.
5. Issue three. The second plaintiff, Century West, as a lessee and affected business operator, claims separate compensation under s 241(6) of the LAA, for its 'additional costs of leasing temporary (business) premises'.
6. The PTA responds that there were no such 'additional' costs. The amount of rent paid by the second plaintiff concerning the business premises to which it moved at 415 Dundas Road, High Wycombe (referred to thereon as '415 Dundas Road') from 1 March 2016 following the taking - under a new lease with a new landlord - was at significantly lesser rent than the level of rent Century West had earlier committed to pay the related corporation DBW, under the former lease over 249 Dundas Road entered prior to the taking and then, the necessary termination of that lease.
7. Issue four. Century West also claims to be entitled to compensation by s 241(6)(b) of the LAA for 'lost income', for a loss of future revenue obtainable upon profitable contracts that Century West believes it would likely have obtained with a third party, had the taking not occurred. Such future contracts and their allied future revenues and profits for Century West are said to have been lost, because Century West from 1 March 2016, at then, no longer had available the spare space at the relocated business premises that it came to rent - in order to make available for the use of customers for storage of their materials (by contrast to the greater levels of available spare space feature as a lost in their smaller, but more efficiently configured, former business premises).
8. The PTA on issue four submits by par 8 of their written outline of opening submissions that:

(1) The Second Plaintiff is unable to establish it would have won these contracts.

(2) In any event, the Second Plaintiff would only be entitled to receive net profit, not gross profit, under these contracts. A cost involved in earning that gross profit is the cost of the land on which the materials would have been stored (that is, the rent that would have been paid for the land by the Second Plaintiff in order to make it available to its contractors). The Second Plaintiff is now paying less rent than it otherwise would have; and the net profits that it would have earned are less than the rent differential. The Second Plaintiff has lost nothing.

(3) If this 'lost income' was likely and profitable, a reasonable person in the position of the Second Plaintiff (or Plaintiffs) would have leased (or purchased) alternative land on which to store the materials, and hence earn the income said to be lost.

1. Issue five. A claim is made by DBW for 'stamp duty' (in an amount of $36,545.89) payable on the purchase of land at Eagle Bay which was later acquired by Haydn and Leida (also known as 'Lisa') Reynolds in their personal capacities. The defendant submits that this is not a claimable expense incurred by DBW. DBW relies on s 241(6)(e) of the LAA. I agree that this claim is conceptually misconceived at the outset and must be rejected.
2. Issue six. This is a small item claim to recover the amounts of the wages of Century West's permanent employees who had spent their time in February 2016 on work that was related to the move to 415 Dundas Road (along with imputed future wages costs of staff for a future move to 'permanent' premises).
3. The PTA accepts it would have a compensation obligation for some level of claimed loss by reason of the enforced move to relocated business premises, such as for any extra overtime costs payable to employees incurred as a result of the 2016 move. However, it rejects any obligation to compensate for loss claims based on alleged losses of profit claimed for ordinary permanent employees engaged then on fixed wages by the Century West business - who became involved in relocating Century West's business to 415 Dundas Road.
4. Issue seven. A dispute emerges over whether the value of an acquired demountable building which was the property of Century West is to be compensated at the depreciated level for the building, or not.
5. The PTA accepts that the depreciated cost is payable, consistent with its approach to compensating for other improvements.
6. As matters emerged at trial, the amount claimed for the demountable building by the second plaintiff was reduced under its written outline of closing submissions of 13 October 2022 (folio 95) to $67,455 (see pars 1 and 90). The amount offered by the defendant was $64,241. (The fiscal gap of $3,200 is manifestly uneconomic to be cavilling over in the Supreme Court).
7. Issue eight. Whether leasing costs, leasing preparation fees, bank guarantee costs, interest on overdraft and 'administration costs' claimed are payable as compensation to Century West by s 241(6) of the LAA and, in any event, are they costs that should be offset against the alleged benefit it obtained by not paying a higher rent at the relocated premises - which higher rent otherwise would otherwise have been payable by Century West to DBW at the former business premises had the taking of the land not occurred? This, in effect, is a miscellaneous sundries claim for $25,336 (see par 76 of the defendant's written outline of opening submissions).
8. The PTA says none of these claimed amounts are legitimately compensable, once other considerations are brought to account. The discrete items concerned are found identified under par 48 of the further amended statement of claim of 9 July 2021 (folio 68).
9. Issue nine. From when should interest be calculated? The PTA submits that by s 241(11) of the LAA interest should be paid from the date of service of the claims, being 17 November 2015.
10. During the course of the trial the plaintiffs look to have accepted this to be the correct position (see ts 666).

Statutory compensation for taken land under the LAA

1. By reason of s 179(b), residing within pt 9 of the LAA, registration of a 'taking order' in relation to 'taken land' will extinguish every registered and unregistered interest in the land - so that 'each person who formerly held such an 'interest' [see s 202(1) of the LAA] has that holding converted into a claim for compensation under Part 10'.
2. Later, I set out the relevant components extracted from within Part 10 of the LAA and address how the compensation payable is to be determined.
3. Here, an essential issue that has emerged as the key point of dispute in the trial concerns whether or not DBW as the first plaintiff and as the relevantly interested and dispossessed landowner ‑ in relation to its six taken lots (usually referred to in aggregate by their street address, as 249 Dundas Road) - is entitled to statutory compensation for the 'value of the land', at 11 April 2013, assessed at some level that is higher than its assessed market value? This dispute arises around the reliance by DBW on a valuation concept or principle it refers to as 'value to the owner' - applied to its taken land. I expand upon this key aspect of the dispute in more detail across the reasons in due course.

1. In this litigation the PTA, as defendant, accepts full responsibility to compensate DBW under s 241(2) of the LAA - as owner of the compulsorily acquired land.
2. Nevertheless, the PTA objects to paying compensation at a level that would be more than the assessed market value of the taken land, at 11 April 2013.
3. The PTA consequently accepts a responsibility to pay compensation to DBW for the land under s 241(2) of the LAA in the amount of $8,500,000 - worked out upon its and its valuation experts' assessments as to the value of DBW's interest in the land - for the purposes of s 241(2)(a) of the LAA. But the PTA rejects DBW's greater monetary claim of an asserted entitlement for an extra (higher) level of statutory compensation grounded conceptually upon a greater so-called 'value to the owner' amount - exceeding the assessed market value.
4. The PTA's assessed amount of $8,500,000 is a revised upwards market value for the land - as assessed and revised (upwards) most recently by one of the defendants' two expert property valuers. It was a revised amount as assessed by Mr Jonathan Fyson, of McGees Property - under his calculations implementing a valuation methodology for the land including all its improvements by the so-called 'summation' method. That summation valuation methodology is likewise said by the plaintiffs to be the preferred approach. Four expert property valuers gave evidence at the trial - two on each side.
5. One of two expert property valuers called on behalf of the plaintiffs at the trial (Mr Matthew Garmony) assessed the value of the freehold interest taken from DBW under the summation method - at a higher figure of $9,360,000.
6. Working presently from those rival Fyson/Garmony positions, the gap between Mr Fyson's end assessment applying summation valuation methodology and Mr Garmony's result applying the same approach, is only $860,000. Contextually, for a property of these dimensions, that quantum gap is not that much, given the nature of the exercise involved and the elemental components of subjective opinion and professional judgment in play by experts.
7. There was no dispute at the trial that by the terms of s 241(8) of the LAA that DBW should also receive a 10% further payment to be added to the as-assessed s 241(2) sum - as further (solatium) compensation to be added to the award to compensate for the taking of land without agreement.
8. This 10% amount (compare s 241(9)) of the LAA must be added. That is appropriate.
9. Working from Mr Fyson's summation number, a 10% (s 241(8) of the LAA) solatium award calculated on $8,500,000 would generate a further $850,000 sum payable (ie, $8,500,000 plus $850,000 = $9,350,000). On Mr Garmony's higher figure, the 10% solatium payment would be $936,000.
10. Before the trial began, the PTA had made an advance payment of compensation to DBW of $6,900,000 (exclusive of solatium and interest). That was at 15 March 2016. There followed a second tranche of a $1,180,000 payment to DBW at 21 January 2020 - amounting then to $8,080,000 advanced and paid to DBW already for the land (again, exclusive of agreed solatium and interest amounts).

1. As a result of the taking order, a transport haulage business operated by Century West from the land - under a lease from DBW - needed to relocate to new premises if it was to continue to operate.
2. Century West at the end of February 2016 did relocate its business to new premises that it leased. But this arrangement was under a new lease it had entered with an unrelated and arm's length third-party landlord - since the former lease it had held from the related corporation owner DBW, could no longer continue - upon the land being taken.
3. Century West duly vacated its leased business premises at 249 Dundas Road on 29 February 2016, handing over the keys to a representative of the PTA at 1 March 2016.
4. However, Century West was given permission by the defendant to continue to use a loading ramp at the resumed premises for a further month, until 31 March 2016.
5. Century West, as second plaintiff, lessee and haulage business operator is also accepted to be entitled to receive compensation by the PTA - based upon an accepted loss of its distinct and separate legal interest as lessee and also as a disrupted former business operator of the taken land - which claim Century West aside from DBW, independently pursues against the PTA. But there are conceptual disagreements over how much compensation Century West is lawfully entitled to receive.
6. Essentially, a claim is advanced by Century West under s 241(6)(b) of the LAA - for claimed business disturbance losses to its road haulage and storage business as conducted at those former business premises. Century West as well also advances a solatium payment for itself.
7. At the request of the PTA, Century West had left behind for the PTA's acquisition a demountable building that had been owned by Century West (essentially, a severable tenant's fixture) ‑ comprising three bedrooms, two bathrooms, a kitchen and living accommodation. The demountable building had been used by Century West for truck drivers' accommodation when needed, as an adjunct at the road transport haulage depot operations.
8. The demountable building measured 57.6 sqm and had been installed adjacent to the workshop at the 249 Dundas Road premises.
9. There is in the trial a claim by Century West for the value of the demountable building left behind and a small issue arises over its true depreciated value - which again, the PTA accepts is payable to Century West once correctly ascertained.
10. Century West, after relocating, had entered a three-year lease for so-called 'temporary' accommodation. This was at the relocation premises relatively nearby, at 415 Dundas Road, and from which it continues to operate its road haulage transport business.
11. Century West claims for a loss of a business opportunity suffered, for it to earn further revenues over time under a third-party storage area utilisation arrangement - that it says was feasible at the former premises, due to its more utilisable configuration for spare space. However, such an arrangement around storage use for third parties was not feasible, it says, at the relocated business premises, although, in fact, they are of a greater area.
12. Century West also advances a further and distinct claim for economic loss. This arises, it says, by reason of it, in effect, having to deal post February 2016, with an arm's length new landlord of its relocated new business premises - rather than under its former and less rigid lease arrangements with the related DBW land owner corporation - under common family directors. This is a novel claim to say the least.
13. To that end, Century West, as second plaintiff, by par 49 of the further amended statement of claim, pleads:

The rent and variable outgoings payable by the Second Plaintiff on the temporary premises at 415 Dundas Road are significantly more than the loan repayments payable to the bank in respect of the former mortgage on the land which rent and outgoings have put significant financial pressure on the cash flow and profitability of the business.

1. Accordingly, Century West advances this further economic loss claim for $684,275. That loss amount is described as the 'additional costs' of it leasing the so-called 'temporary' premises at 415 Dundas Road ‑ as the difference between the level of the rent it now must pay at its relocated business premises at 415 Dundas Road at a level of rent that is above the (lower level) secured loan, interest only, payments once being made by the first plaintiff, DBW, to its mortgagee (Westpac) for 249 Dundas Road. There are immediate conceptual problems with such a claim - not the least of which is the conflation as between rent paid (by Century West) to an arm's length landlord under a lease in contrast to the interest paid by the borrower (DBW, not Century West) on a loan from a bank.
2. It is necessary to point out that the borrowing arrangements at 249 Dundas Road were such that DBW, the first plaintiff (not the second plaintiff, Century West), had borrowed funds exceeding $3,000,000 from Westpac - secured by first registered mortgages over all the six lots - on which monthly interest was then payable by DBW on an interest only loan with the bank.
3. DBW bore the legal responsibility as the borrower for meeting those interest payments to Westpac. It was DBW as owner and borrower, not Century West as a lessee of the land from DBW and the business operator, that was liable for the interest to Westpac on those loans. Century West paid rent to DBW and it seems the level of the rent (when paid) matched, or was close to the level of the loan interest repayments. But those back‑to‑back arrangements were friendly, rather than strictly legal. At times, there were unpaid arrears by Century West, that were not pursued. Century West's rent when paid was said, roughly, to have been at about the level of market rent. That as-received rent by DBW was then conveniently deployed by it to service the interest accruing due on its Westpac loan. That is what their accounts reflect. The 'rent' paid by DBW was claimed as a tax deductible business expense. Friendly as these arrangements obviously were, they were legally distinct and no doubt tax efficient.
4. Both plaintiff corporations were and still are run by common directors, that is, Mr Haydn Reynolds and his wife, Mrs Leisa Reynolds. The PTA rejects any proper conceptual basis for it to render such an amount of 'additional costs' to the second plaintiff as proper compensation.
5. Century West's claimed loss of a business opportunity around its lost storage space capable of being hired out to third parties, is also rejected. Under that claim, as alternately formulated, the level of the claim ranges from between $587,210 to $803,100. Whilst PTA rejects that lost opportunity claim as unprincipled, it does allow an amount of $13,500, for the reasons I will explain later.
6. There is a conceptual issue arising in the trial over whether, as a matter of law, a claim for statutory compensation under s 241(6) of the LAA can legitimately support a claim to what is, in effect, a claimed economic loss of a chance, or a lost business opportunity. This is the claim for the allegedly lost business opportunity of obtaining greater revenue through the (lost) opportunity to enter more profitable

third-party contractual arrangements, albeit such arrangements were never actually ever perfected. 7. The PTA's contrary position is that ss 241(6)(a) and (6)(b) of the LAA in particular, cover only 'loss or damage' that is 'sustained' by reason of a disruption or a reinstatement of a business. Hence, it is said that, the loss of a mere economic opportunity, or of a chance, does not engage with that required statutory threshold, according to the PTA. 8. There are a number of smaller fiscal magnitude relocation cost and economic loss claims in the trial all advanced by Century West. They can be more usefully discussed later, in the running. By themselves they are not economic to pursue in Supreme Court litigation.

Legal principles: compensation claims under the LAA

1. It is convenient to begin by revisiting the principles bearing upon land compensation and as to the valuation of taken land for public purposes.
2. In Lenz Nominees Pty Ltd v The Commissioner of Main Roads [2012] WASC 6; (2012) 186 LGERA 58, Edelman J identified some basic legal propositions relevant to the task (see [66]). They in turn had been taken from, as he said, the principles canvassed in greater depth by Beech J (as his Honour then was) in McKay v Commissioner of Main Roads [No 7] [2011] WASC 223.
3. The summary of principles assembled by Edelman J canvassed 13 propositions, which for orientation purposes, I will set out below:

(1) Assessment of compensation must be conducted with regard only to the matters contained in s 241 of the Land Administration Act: s 241(1); Konowalow and Felber v Minister for Works [1961] WAR 40, 41 (Virtue J).

(2) No regard is to be had to the value of any improvements made without the consent of the Minister after the registration of the notice of intention on 13 December 2005: s 241(4) Land Administration Act.

(3) The purpose of the assessment of compensation for resumed land is to ensure that the person to be compensated is given a full money equivalent of his or her loss: Commissioner of Succession Duties (South Australia) v Executor Trustee and Agency Company of South Australia Ltd [1947] HCA 10; (1947) 74 CLR 358, 373 - 374 (Dixon J).

(4) Compensation for the value of the resumed land should be assessed in a theoretical, albeit artificial, fashion by assuming the land had been sold on the date of its acquisition by the resuming authority: Boland v Yates Property Corporation Pty Ltd [1999] HCA 64; (1999) 167 ALR 575, 647 - 649 [265], [271] (Callinan J).

(5) This theoretical approach to assess compensation for the resumption of the land requires the court to identify the price which would be paid under a hypothetical bargain between a person 'desiring to buy the land ... to a vendor willing to sell it for a fair price but not desirous to sell': Spencer v The Commonwealth (1907) 5 CLR 418, 432 (Griffith CJ); Mount Lawley Pty Ltd v Western Australian Planning Commission [No 3] [2008] WASCA 158 [25] (the Court).

(6) In assessing the price payable in this hypothetical sale, it must be assumed that the hypothetical purchaser would be purchasing the land for the most advantageous use for which it is adapted: Spencer v The Commonwealth (441) (Isaacs J). This 'most advantageous use' is commonly referred to as the 'highest and best use' of the land: ISPT Pty Ltd v Melbourne City Council [2008] VSCA 180; (2008) 20 VR 447, 458 - 459 [40] (the Court); Commonwealth Custodial Services Ltd v Valuer-General (NSW) [2006] NSWLEC 400; (2006) 148 LGERA 38, 45 [15] (Biscoe J).

(7) The highest and best use of the land may be a single use or it may be a package of alternative uses: ISPT Pty Ltd v Melbourne City Council 462 [57]. However, in the instance of a package of alternative uses, care must be taken to ensure that those alternative uses are not inconsistent: Love v Roads Corporation [2011] VSCA 434 [63] - [66].

(8) In assessing the highest and best use, the existing use will be a relevant, although not necessarily determinative, factor: ISPT Pty Ltd v Melbourne City Council 458 - 459 [40]; Commonwealth Custodial Services Ltd v Valuer-General (NSW) 45 [15] (Biscoe J).

(9) The hypothetical purchaser must be assumed to have regard to all relevant available information, and to be cognisant of all circumstances which might affect the value of the land: Walker Corporation Pty Ltd v Sydney Harbour Foreshore Authority [2008] HCA 5; (2008) 233 CLR 259; 276 - 277 [51] (the Court); Boland v Yates Property Corporation Pty Ltd [271] - [274] (Callinan J).

(10) However, the hypothetical sale and the determination of the value of the plaintiff's interest in the land taken, and the compensation payable to the plaintiff must be conducted by 'discounting any increase or decrease in value attributable to the proposed public work': Land Administration Act s 241(2).

(11) In conducting the valuation exercise it has been iterated and reiterated that a court must not usurp the skill and experience of a valuer. In other words, the court must not allow itself to become a 'third valuer': Bronzel v State Planning Authority (1979) 21 SASR 513, 523 (Wells J); Brewarrana Pty Ltd v Commissioner of Highways (No 2) (1973) 6 SASR 541, 544 ‑ 545); Arcus Shopfitters Pty Ltd v Western Australian Planning Commission (WA) [2002] WASC 174; (2002) 125 LGERA 180 [76] (Pullin J).

(12) However, the prohibition against a court becoming a 'third valuer' does not, and cannot, prevent the court from making its own adjustments to the valuations, particularly where a valuer's adjustments to comparative sales are not wholly accepted. Judicial adjustment to the valuation may sometimes be unavoidable because a court cannot adopt adjustments which it has rejected; the court would otherwise be left with no basis to assess the value of the subject land: McKay v Commissioner of Main Roads [2484] (Beech J).

(13) If any doubts exist in assessing the compensation payable, then those doubts should be resolved by a liberal estimate in favour of the dispossessed owner: Commissioner of Succession Duties (South Australia) v Executor Trustee and Agency Company of South Australia Ltd (373 - 374) (Dixon J); Boland v Yates Property Corporation Pty Ltd [100] (Gaudron J), [111] (Gummow J), [356] (Callinan J).

1. In another compensaton action brought in this Court, Italiano v The Water Corporation [No 2] [2020] WASC 112, I discussed the same principles at [76] of those reasons. That resulted in my assembly for that case of 31 distinct principles. I will repeat them as well:

(a) The planning and development of land in Western Australia is, generally speaking, controlled by the Planning and Development Act 2005 (WA). Generally, a development of private land is not permitted without an approval from an authority, although there are many exceptions. Broadly speaking again, development will not be approved unless a proposed development is proposed as in accord with relevant planning instruments: see s 162 of the Planning and Development Act.
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> (b) By contrast, the compulsory acquisition of land in Western Australia by the State or by an authorised public authority is now governed by the LAA.
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> (c) Part 9 of the LAA deals with the processes for a compulsory acquisition of land. The process begins with an issue of a notice of intention to take: see s 170 - s 171. Subject to exceptions, required land cannot be developed or sold without the relevant Minister's approval: see s 172 - s 173. Once an objection period is allowed to run (s 175), the Minister may, absent a successful objection, issue a Taking Order: see s 177 - s 178. Upon the registration of a Taking Order (in contra distinction to an issue of the Taking Order), the compulsory acquisition takes effect: see s 179. The date of registration of the Taking Order is therefore the date of acquisition and is the date of valuation of the taken land for the purpose of assessing any compensation due to former landowners.
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> (d) Part 10 of the LAA then addresses the issue of the statutory compensation to be paid in respect of a compulsory acquisition of taken land. Within pt 10 lies s 241, some parts of which I have set out earlier. Section 241 assembles the considerations that must be included in any assessment of compensation exercise.
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> (e) Parts 9 and 10 of the LAA, generally speaking, apply to 'public works'. Again generally, pt 9 allows for the compulsory acquisition of land for the purposes of a proposed public work: see s 161.
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> (f) Parts 9 and 10 of the LAA enjoy a legislative history extending back to the terms of the former Public Works Act 1902 (WA). Part 9 of the LAA still defines a 'public work' by reference to a definition found in the Public Works Act: see s 151.
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> (g) The quantum of compensation payable in respect of taken land requires an assessment of the price at which the land would have been acquired, assessed objectively, as between a hypothetical seller and a hypothetical purchaser, with both further assumed as willing, but not anxious, to deal and with both the seller and the purchaser also assumed to be fully acquainted with the attributes of the land affecting its value. The law as famously stated by the High Court of Australia on this point in Spencer v The Commonwealth (1907) 5 CLR 418, 431 - 432 remains applicable to the phrase 'the value of the land', as it is used in s 241(2) of the LAA.
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> (h) It has been also said that the as assumed hypothetical seller and purchaser are also assumed to be 'cognizant of all circumstances which affect [the land's] value': see Wells J in De Ieso v Commissioner of Highways South Australia (1981) 27 SASR 248, 252. Among such familiar circumstances are the opinions of persons, 'regarded as authoritative in matters, with respect to value and factors affecting value' (De Ieso, 252) for the land.
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> (i) Wells J had continued in De Ieso at page 253 to observe that a court is not within this exercise:

called on to inquire ultimately whether, as a fact, the planning authorities would have approved a relevant plan of sub‑division. Rather it is called on to decide how a hypothetical prospective developer (who may be assimilated in the present context, with the willing, but not anxious, hypothetical purchaser posed by the judgments in Spencer's case) would have viewed [their] potential financial return if [they] were considering a proposal that included one or other of the proposed plans.

(j) In Port Stephens Shire Council v Tellamist Pty Ltd [2004] NSWCA 353; (2004) 135 LGERA 98, Ipp JA observed at [491] that information in the hands of a public authority as at the taking date, was presumed to be made available to the hypothetical seller and purchaser. His Honour further observed at [489]:

In my view, the overwhelming thrust of these authorities is to the effect that the hypothetical seller and purchaser are to be assumed, in the hypothetical situation postulated, to be aware of all information relevant to the market price, about which a prudent purchaser would inquire.

(k) As already seen, s 241(2) of the LAA provides that the value of the taken land is to be assessed on a basis of 'discounting any increase or decrease in value attributable to the proposed public work'. Such words are recognised in the cases as a legislative manifestation of a well-known principle applied in the area of statutory compensation, known as the Pointe Gourde principle: see Pointe Gourde Quarrying and Transport Co v Sub Intendent of Crown Lands (Trinidad) [1947] AC 565. See also McKay v Commissioner of Main Roads (No 7) at [206] where Beech J explained, in effect, that the legislative text, even if accepted as an attempt to reproduce that 'principle', is itself determinative.

(l) The discounting of increases or decreases in value that are assessed as being attributable to a proposed public work, are related counterpart provisions.

(m) As regards discounting increases in value, the acquiring authority should not be required to pay an acquisition price that is elevated by the market's knowledge of the intended public work: see Queensland v Murphy [1990] HCA 42; (1990) 95 ALJR 493, 496.

(n) Conversely, the acquiring authority ought not be allowed to adversely affect the value of land by imposing restrictions upon its use, so as to facilitate it to later acquire the land at a lesser value, by reason of the market's knowledge of such negative features.

(o) Thus, the hypothetical valuation exercise following a compulsory acquisition of land for a public work concerns the assessed value of the taken land upon the premise it had not been taken and, assuming further, that the public work for which it was taken, were not in prospect.

(p) One correlative consequence of the Pointe Gourde principle as codified by s 241 is that earlier 'steps' taken by a public authority towards the later taking of land, are also to be disregarded. Hence any public advertising of a scheme amendment so as to reserve land for a public work, or for the undertaking of preparatory physical works as preparatory steps along the process of an ultimate eventual taking, must, as regards their effect(s) upon value, also be disregarded. To that end, see the observations of Jacobs J in the High Court of Australia in Housing Commission of New South Wales v San Sebastian Pty Ltd [1978] HCA 28; (1978) 140 CLR 196, 206 - 207. See also observations by the Court of Appeal of Western Australia in Mount Lawley Pty Ltd v Western Australian Planning Commission [2007] WASCA 226; (2007) 34 WAR 449 at [28] - [29].

(q) Applying the Pointe Gourde principle, it is usually asked what the position would be for the land had the taking not occurred, or been a subject of the planning steps to that end. In that context a series of hypothetical planning decisions for the unaffected scenario are to be made for the purposes of a valuation. See Trandos v Western Australian Planning Commission [2001] WASCA 346; (2001) 117 LGERA 257. But any previous irregular planning decisions are not admissible: see McKay v Commissioner of Main Roads [No 7] at [307].

(r) Towards the underlying hypothesis of orderly and proper planning towards the land: see Marshall v Metropolitan Region Redevelopment Authority [2015] WASC 226 at [178] ‑ [182]. Whilst there is generally an element of discretion, the objective of 'orderly planning' is to maximise the predictability of planning and development decisions, by minimising of ad hoc decisions, and particularly by also minimising any departures from established planning trajectories.

(s) Compensation is generally payable by an undertaking of a valuation conducted on the basis of the taken land's 'highest and best use'. That concept invokes the need to assume, through the knowledge of what is both possible and lawful, those uses of the land and any market for its possible future use - which assumed use would fetch the highest price for the taken land.

(t) Within the context of assessing the value of the land at its highest and best use, there must as well be considered the hypothetical 'potentiality' of the land. This will embrace consideration of a use other than the current use of the land, which after use is not presently lawful, but which use could become lawful in the future, if an amendment could be secured to the zoning or other planning or environmental restrictions upon current applications. Hence, land that is presently zoned rural is commonly said to have a potential for rezoning to urban. Consequently, a hypothetical purchaser of such land is assumed to be willing to pay something for the worth of this potentiality but, nevertheless, not the full value of the land, as if it had achieved that future potential: see Mount Lawley Pty Ltd v Western Australian Planning Commission [2004] WASCA 149; (2004) 29 WAR 273 (Mount Lawley [2004]) at [162] ‑ [166].

(u) Potentiality is not to be fully equated to highest and best use. A court and valuers may not treat as an actuality that which is merely a potentiality: see Turner v Minister of Public Instruction [1956] HCA 7; (1956) 95 CLR 245; McKenna v Municipality of Burnie [1970] TASStRp 23; [1970] Tas SR 279 and Yates Property Corporation Pty Ltd (in liq) v Darling Harbour Authority (1991) 24 NSWLR 156; (1991) 73 LGRA 47. As it was vividly explained by Crisp J in Beard v Director of Housing (Tasmania) [1961] TASStRp 20; [1961] Tas SR 141, 149 '... there is a difference between an anticipated and a realised potential, between the unhatched egg and the chicken'.

(v) As regards the intersection of a valuation predicated upon highest and best use and the potential of a premium to be paid as ascribing some more value on account of future potential, Beech J in McKay v Commissioner of Main Roads [No 7] at [158] summarised the position this way:

Thus if the most profitable use of the land is one not permitted by its current zoning, the concept of highest and best use requires the potential of the land to be used for that more profitable use, after necessary planning approval, to be taken into account. It does not require or permit an assumption that the necessary planning approval will be forthcoming. The prospects of such approval as determined on the evidence, viewed from the prospective of the hypothetical parties, will bear on the assessment of the value of that potential use.

(w) In the exercise, the court is not standing in the shoes of a planning authority, but rather considering how the hypothetically assumed parties would have viewed the land's potential, or prospects. See again, McKay v Commissioner of Main Roads [No 7] at [1503].

(x) In conducting an assessment of value by reference to the highest and best use of land, what are only remote and speculative possibilities are to be disregarded. For instance in C A MacDonald v South Australian Railways Commissioner [1911] HCA 14; (1911) 12 CLR 221, a canvassed possibility of the owner obtaining a necessary licence to use the land for a special purpose, even if the land were adaptable for the special purpose, was assessed as being so remote as to be negligible and, therefore, to be disregarded in assessing the compensation payable. See also Davis Properties Pty Ltd v Roads and Traffic Authority of New South Wales [1995] NSWLEC 172 (18 October 1995).

(y) As stated by authors Newton G and Connelly C, Land Acquisition (7th ed, 2017) at par 3.17:

Determining whether resumed land has a better economic use than that to which it was being put at the time of resumption requires the valuer to assess probabilities. Where the valuer crosses the boundary into 'unacceptable guess work' the claim will be rejected: Gugusheff v South Australia Urban Land Trust (1990) 55 SASR 268. It may be added that a valuer's opinion that the resumed land has a highest and best use needs to be supported by convincing evidence.

(z) In an assessment of the value of the highest and best use of land, applicable planning schemes must be considered as a fundamental element in the decision‑making process: see Kirela Pty Ltd v Minister administering the Environmental Planning and Assessment Act 1979 [2003] NSWLEC 135 at [159] ‑ [160].

(aa) In Boland v Yates Property Corporation Pty Ltd [1999] HCA 64; (1999) 167 ALR 575 at [268] Callinan J, in terms of explaining the as assumed hypothetical parties being perfectly acquainted with the land at issue, rendered the following observations and in the process referred to the frequently cited passage by Isaacs J in Spencer v The Commonwealth as to parties:

... perfectly acquainted with the land, and cognizant of all circumstances which might affect its value, either advantageously or prejudicially, including its situation, character, quality, proximity to conveniences or inconvenience, its surrounding features, the then present demand for land, and the likelihood, as then appearing to persons best capable of forming an opinion, of a rise or fall for what reason soever in the amount which one would otherwise be willing to fix as the value of the property.

The comprehensive language used by Isaacs J is clearly capable of embracing matters with which perhaps courts of the day have become more familiar, such as the value of a highly restrictive or very advantageous planning approvals, the changing value of money over time and opportunity cost. So too computerisation has in modern times enabled the testing of financial projections, the difference sensitivities, of time, interest rates, changing values of money, different occupancy rates and other contingencies both favourable and unfavourable relatively easily and expensively.

See also Mount Lawley [2004] at [162], to like effect, as regards the:

hypothetical vendor and purchaser being perfectly acquainted with the land and all of its characteristics ... including those which render it suitable for development and, as well, those which militate in favour of reservation.

(bb) Principles applicable by reference to a use of a comparable sales approach as used by valuers are summarised by Pritchard J (as her Honour then was) in Kelliher v Commissioner for Main Roads [No 2] [2015] WASC 478 at [89] - [95].

(cc) As regards use of the conventional valuation methodology of comparable sales, I note cautionary observations of Pullin J (as his Honour then was) in Arcus Shopfitters Pty Ltd v Western Australian Planning Commissioner [2002] WASC 174; (2002) 125 LGERA 180 at [78] to this effect:

It is not satisfactory, in my opinion, for a valuer who values land using the comparable sales method to list a number of comparable sales, each one suggesting a different value for the subject land and each of which requires some adjustment, and then simply to state an opinion about the value of the subject land. Such an opinion will only have any value if the valuer explains which is the most important of the comparable sales, why that is so, and what adjustments have been made to reach a conclusion about the value of the subject land.

(dd) If there is any doubt as to the amount properly payable by way of compensation, then the doubt should be resolved in favour of a more liberal estimate: see Commissioner of Succession Duties (South Australia) v Executor Trustee & Agency Company of South Australia Ltd [1947] HCA 10; (1947) 74 CLR 358, 374. Locally, that approach was endorsed by Anderson J in Cook & Edwards v City of Stirling (1991) 4 WAR 469, in a context of assessing what was competing valuation advice. His Honour had observed at page 473, '[a]s I am not able to regard one opinion as any more meritorious than another on this point, I must resolve the question in favour of the rate that will result in a more liberal award of compensation'. To the same effect were observations by Gaudron J in Marshall v Director-General, Department of Transport [2001] HCA 37; (2001) 205 CLR 603 at [38]. Within that decision McHugh J at [48] also observed:

In the case of legislation dealing with compensation to be awarded in respect of the compulsory acquisition of land, however, a different presumption operates. The legislation is intended to ensure that the person whose land has been taken is justly compensated. Such legislation should be construed with the presumption that the legislature intended the claimant to be liberally compensated. That being so it would be wrong to construe a provision such as s 20(1)(b) as conferring compensation only for damage that results from an act that is 'the very thing, or an integral part of or step in the very thing, which the provisions of the Act' gave the constructing authority power to carry out. Whenever the constructing authority takes steps to achieve any purpose or carrying out any function that is incidental to the purpose for which part of the land was acquired, it should be regarded as an exercise of a statutory power within the meaning of s 20(1)(b).

(ee) The function of an award of solatium (see s 241(8) and (9) of the LAA as set out earlier) is to recompense a claimant for any distress, inconvenience and reluctance to lose their land or land interest, which is being resumed. Such recompense is in an amount over and above for matters otherwise compensable under various heads of claim - other than s 241(8) and (9). See R v Compensation Court of Western Australia (1990) 2 WAR 242 per Brinsden and Walsh JJ at 265 - 266.

1. For present circumstances, however, the underlying facts are clearer than for the Italiano litigation.
2. Here, the entire six taken lots owned by DBW at 249 Dundas Road, were the subject of the taking order. Consequently, no issues raising the sometimes encountered concepts of severance, or of an injurious affection against the residual land that is not taken, present in this trial.

'Value to the owner': the plaintiffs' arguments

1. It is necessary to see how the first plaintiff, DBW, sought to lay a foundation to engage with this 'elusive concept'. First, I commence with the pleadings, noting that under the plaintiffs' further amended statement of claim they fashion DBW's 'value to the owner' claim at par 40 in the following terms:

The First Plaintiff has spent a considerable amount of time and effort both in putting together the land so that it constituted the ideal shape and configuration for the efficient running of the business and in constructing the improvements erected on the land...

1. Next follow 10 considerations assembled under given particulars, culminating in a concluding plea (which I treat as a plea of material fact) 'all of which collectively are said to support a compensation valuation for the land calculated on the basis of "value to the owner"'.
2. The 10 matters under the particulars to par 40 which, as matters of fact, can all essentially (save for (j)) be accepted as proven at the trial, chiefly on the evidence of Mr and Mrs Reynolds, were as follows:

(a) the Second Plaintiff specialises in transporting extendable roads and it was therefore important to achieve two road frontages to avoid the need for full turning of very large vehicles inside the depot;
>
> (b) the two road frontages were achieved through purchases, amalgamation and re-subdivision of an adjoining owner's land;
>
> (c) land swaps with that owner to mutual benefit over a period of five years between 2008 and 2012;
>
> (d) land providing a third street frontage was purchased in 2012 for access flexibility and storage for customer product;
>
> (e) the First Plaintiff expended a significant amount of money in stamp duty, consultants' fees and planning fees to achieve the configuration discussed in the foregoing particulars;
>
> (f) in order to obtain that configuration, the First Plaintiff had to give up 1130 sqm of land in the purchased landholding to form a drainage basin, to provide road reserve for Imperial Street and to contribute to the cost of both;
>
> (g) each lot is serviced and has deeper than usual bitumen surfacing to withstand the additional weight of the larger commercial vehicles;
>
> (h) each of the three entrances were fitted with automatic gates and security cameras and the exterior of the land was attractively fenced and landscaped;
>
> (i) three lots (nos 723, 722 and 721) were amalgamated to form Lot 757 and the improvements constructed on that lot, which are of the highest quality and condition are described in paragraphs 33 and 34 thereof; and
>
> (j) the First Plaintiff, in acquiring replacement land, is now at risk of having to pay development contributions pursuant to State Planning Policy 3.6 and the Precinct Plans and Development Contributions Plans in course of preparation and imposition upon land within the Shire of Kalamunda.

3. The plea was denied by the defendant in its defence (see par 40 of the re-amended defence of 23 August 2022 (folio 80)). But, essentially, the dispute is one of principle, rather than raising any real arguments over most of these particularised features of the taken land - which are relied upon to support a compensation amount greater than market value on the basis of so-called 'value to the owner'.
4. Essentially, the PTA says that compensation assessed by reference to true market value is the proper level of compensation, capturing the value of all attributes for the taken land - and without any further allowances made for what is claimed as 'value to the owner'.
5. The PTA also says that to the extent the land's shape, configuration and improvements were suitable for an efficient running of the second plaintiff's business, that this suitability was reflected in the rent payable by the second plaintiff to the first plaintiff.
6. The level of the rent payable under the lease arrangements as between the second plaintiff and the first plaintiff was said to be 'broadly speaking, aligned with market [rent]': see evidence of the defendant's expert property valuer, Mr Fyson, at ts 275. There is little suggestion to the contrary. I will accept that to be the position.
7. Here, I ought first observe that merely because some of the four engaged expert property valuers under their revised conferral statement prepared for trial (exhibit 22) ventured to express views about 'value to the owner', that any such views will not be determinative, upon what is essentially a question of law for the Court concerning a potential engagement with such a principle in all the circumstances.
8. One of the defendant's property valuers, Mr Hall, has consistently rejected that concept's potential application. The plaintiffs' valuers look to have been instructed towards considering its potential engagement (Mr Garmony and Ms Jenny Le‑Fevre).
9. The defendant's other property valuer Mr Fyson, made some level of concession about a potential engagement with such a principle - as a consequence of the four property valuers' pre-trial conferral meetings ‑ at his concluding paragraph, seen between pages 15 and 16 in that document - by reference to his envisaged removal of his 'P & R' (profit and risk) factor, amounting to $250,000. That excision would have raised his summation method amount conclusion upwards (see ts 343), from $8,500,000 up to $8,750,000.
10. However, as I will endeavour to explain by these reasons, conceptually Mr Hall was correct upon what is, essentially, a legal issue.
11. By the plaintiffs' written outline of opening submissions of 20 September 2022 (folio 85), greater explanation is provided for the contended engagement with a 'value to the owner' or a 'special value' for DBW (see pars 67 - 80.3), reading:
    1. Hayden Reynolds has been in the transport business for 44 years.
    2. He started that career in 1978 occupying a corner of the Vinidex yard in O'Connor transporting the vinyl pipes and fittings manufactured by Vinidex. Vinidex remains one of his best and most constant customers today.
    3. In the early 2000s (Mr Reynolds) started to purchase and assemble the lots which ultimately formed the Land and by 2008 had sufficient land to draw up plans for a transport depot (TB document 10A [TB refers to the tabulated documents assembled in the trial book - being the largely agreed documents spanning four lever arch files and 2782 pages of documentary materials for trial]). This required the giving up of land for drainage and to form the road reserve of what became Imperial Street thereby giving the Land its third street frontage.
    4. Dundas Road, at the Valuation Date, could accommodate Rav 5 vehicles or road trains while the other two roads could not. However, that was not material as road trains only made up 30% of the vehicles and in any event the road trains were typically made up in the yard and driven through the front.
    5. The valuers all agreed in conferral that High Wycome/Forrestfield was an expanding, established industrial area in close proximity to Perth Airport and that Dundas Road provided access to Abernethy Road, Tonkin and Roe Highways all four of which are road train rated (RAV 5 and above).
    6. The regular shaped, three frontage yard afforded maximum efficiency for circulation, manoeuvrability and for the all important storage.
    7. The storage on site accomplished two income producing functions: it produced rent for storage and it resulted in the transport contract for on delivery when the goods stored were required on mine and building sites. In the case of Austral it also produced an income from the repair shop for faulty equipment and machinery sooner than returning it to Melbourne for repair.
    8. Two more lots were acquired in 2012 which completed the assembly and construction of a transport depot that regularly won awards (see for example TB 139). [Note: the additional lots were Lots 728 and 729 acquired in June 2012.]
    9. The well-appointed two bedroom transportable unit on site accommodated drivers who needed to stay overnight and the 995 sqm depot accommodated administration offices, workshops with two pits, storage, staff amenity and a quarantine washdown bay.
    10. The special relationship the Plaintiffs had with Austral will be described in the evidence of Peter Slack and underpins the broadening of the special value/value to the owner which the land had to the Operation claim.
    11. The indivisibility of the commercial business interests of the two Plaintiffs, effectively run as one enterprise is described in the evidence of Hayden and Lisa Reynolds. It is extrapolated upon by Jacqui Le-Fevre in her evidence.

80.1 although advance payments were made by the Defendant:

(a) $3,645,000 was (without choice or option) [Note: see the mandatory terms of section 251 of the LAA as regards secured debts over taken land and their discharge from compensation] repaid to the Plaintiffs' bank;

(b) $443,600.51 CGT [capital gains tax] was paid by the First Plaintiff in FYE 2016 (TB 85CB);

(c) $331,971.33 CGT was paid by the First Plaintiff in FYE 2020 (TB 85CC);

(d) $65,904.85 CGT was paid by the Second Plaintiff in FYE 2020 (TB 85CC); and

(e) Deferred payments of $276,000 and $7,761.71 are still owed by the First and Second Plaintiffs respectively (TB 85CE).

80.2 by 2015, mining had taken a downturn. The document TB 38B shows how a substantial amount of the balance of the advance payments went in and out of the Operation to shore it up. As acknowledged in the statement of claim this downturn is unrelated to and not caused by the public work but what was caused by the public work was the amount over and above the mortgage payments on the Land which had to be funded by the Plaintiffs to pay rent and higher outgoings on 415 Dundas Road;

80.3 the inability of the Plaintiffs to service a loan to purchase property was directly caused by the higher outgoings which in turn were caused by the public work. This caused the Plaintiffs' bank to refuse to lend to them (TB 109B and 110).

1. Broadly speaking, those facts seen underlying pars 67 - 80 (excising the accompanying advocacy) can be accepted vis-à-vis the features of DBW's six lots taken in November 2015. They, by reason of the unique terms of s 241(2)(a) of the LAA, must be valued as at 11 April 2013 - because the land was taken for the purposes of establishing the Forrestfield-Airport rail link under a special Act of Parliament.
2. Next, I turn to how this 'value to the owner' concept came to be explained by counsel for the plaintiffs during his opening submissions at the trial commencing at ts 21. Mr McGowan had explained:

Now, the next matter which we've addressed in our submissions, and I want to deal with in opening, is the idea of value to the owner.

And the point - the short point about this is that in circumstances where land is compulsorily acquired, what we're determining is the value from the point of view of the vendor, not the value from the point of view of the purchaser. And - because that's the essence of what we're doing. It's something that the owner has built up, and particular attributes that relate to the way in which the land is put together or functioned are relevant to the way in which the valuation exercise should be undertaken.

1. Mr McGowan referred to exhibit 22, in particular, see item 15 therein at pages 8 - 12. Likewise, I note the comments of the valuers made under item 18 at pages 12 - 13, and then item 19 at pages 13 - 17 of that document.
2. Asked about the intersection of the 'value to owner' concept with the classical Spencer v The Commonwealth [1907] HCA 82; (1907) 5 CLR 418 approach towards ascertaining market value (ts 21 - 22) Mr McGowan, after referring me to Spigelman CJ's observations in Leichhardt Council v Roads & Traffic Authority of NSW [2006] NSWCA 353; (2006) 149 LGERA 439 [24], continued to explain (ts 22):

So that it still involves a recognition within the way in which the land is held and the way in which it's configured that there is a value to the owner which identifies, in effect, what the owner would expect to get. Now, that's not to take away from the Spencer exercise. Rather, it's to reflect that there are certain special characteristics we're dealing with here which enable, as happened, the valuers to approach the exercise by addressing what it is that we're dealing with in reality...

1. Asked about the intersection of 'value to the owner' with 'special value', Mr McGowan further explained at ts 23:

They're interchangeable and ultimately, I think what Spigelman CJ captured is a fairly accurate description of where it's arrived at, that is, it's 'a unifying concept' and as he concludes:

Market value was in most cases the way of computing value to the owner -

provided in so doing (sic) you're recognising that that's what's occurring.

1. The plaintiffs' written outline of closing submissions then addressed the approach in terms of the application of that principle (see pars 175 - 191). See pars 178 and 181, where it was put:
   1. The evidence of Hayden Reynolds as to the work he put into acquiring land, including swapping lots with neighbours (which would have required a double stamp duty impost on the swapped lot: first upon acquisition of the lot to be swapped and second upon the acquisition of the lot acquired as part of the swap) to achieve the ideal configuration and shape serviced by three frontages at No 249 [Dundas Road] is uncontested [referring to par 7 of Mr Reynolds' witness statement filed 18 June 2019 (exhibit 3) and pars 13 - 15 of his subsequent witness statement filed 28 May 2021 (exhibit 4)].
   2. Lots 723, 722 and 721 were first acquired (one by land swap) to form an amalgamated lot 757 on which the depot buildings were constructed (TB Documents 7, 8 and 9).
   3. Lots 739, 740 and 741 were acquired in February 2008 (TB Documents 2, 3 and 4).
   4. The combined site constitutes a rare piece of real estate to anyone but has particular value to the Plaintiffs who would undoubtedly have paid a premium sooner than lose it [being as I understand it a submission invoking the observations of Lord Moulton delivering the advice of the Judicial Committee of the Privy Council in Pastoral Finance Association Ltd v The Minister [1914] AC 1083 at 1088 - 1089 and this often referred words at the conclusion, 'probably the most practical form in which the matter can be put is that they were entitled to that which a prudent man in their position would have been willing to give for the land sooner than fail to obtain it'].
2. Those 1914 words of Lord Moulton from Pastoral Finance Assocation Ltd v The Minister [1914] AC 1083 have given rise to a need for consideration in numerous subsequent cases, including by Callinan J in Boland v Yates Property Corporation Pty Ltd [1999] HCA 64; (1999) 74 ALJR 209. The Full Court in Mount Lawley Pty Ltd v Western Australian Planning Commission [2004] WASCA 149; (2004) 29 WAR 273 had also observed at [284]:

As Callinan J said in Boland v Yates (at [354]), the concept of the dispossessed owner (being regarded as the prudent purchaser in this context) paying above the market price for the land, rather than losing it 'may not be an entirely reliable guide' to the assessment of the special value to the dispossessed owner. However, Spencer might be expected to cover most situations, because:

'... it does not contemplate one who would likely relinquish a property which had a particular value to him or her for less than that value'.

The second plaintiff's costs for two relocations to alternative business premises

1. The 2016 move of the Century West business to 'temporary' premises and a taking out of a lease at that time by the second plaintiff by relocating its road transport business to 415 Dundas Road, may indeed at then have been considered as only a temporary move of premises - with a more permanent move still then in prospect to a different and more suitable business location if found.
2. However, at the time of trial in October 2022 the second plaintiff was still conducting the same transport business from the 'temporary' 415 Dundas Road leased premises location (see ts 17).
3. In response to my question about that now, not so temporary situation, counsel for the plaintiffs advised at ts 17:

They are still there. And the position is, had - and their position remain, had a property which, as it were, would constitute a replica of what they had, come on the market, they would have grabbed it. But it hasn't. That remains their desire, apart from anything else, you know, to be able to own the property with the accrued benefits that flow from that is a much, much better proposition than paying several hundred thousand dollars a year worth of rent to a third party with, in effect, nothing to show at the end of it.

So that's how they [ended] up in the position they're in. They remain clear in their view that they would like to find the elusive property, but, as I say, if it was out there, you would have thought that amongst the four valuers giving evidence, someone would have said, 'Well, there it is.' Well, it isn't.

KENNETH MARTIN J: Well, six and a half years have gone by since 2016 so - - -

MR McGOWAN: It's diminishing.

1. During the course of the trial I did come to receive the evidence-in-chief of Mr Haydn Reynolds and his wife, Mrs Leida Reynolds, provided then by reference to their respective witness statements (see exhibits 3, 4 and 5 for Mr Reynolds and exhibits 10, 11 and 12 for Mrs Reynolds). They were both mildly cross-examined on those statements on day one and day two of the trial.
2. But in the main, their evidence was essentially unshaken or uncontradicted and may be largely accepted as reliable.
3. Concerning the evidence of Mrs Reynolds, I assessed the answers given by her in the context of a reluctance to take on higher levels of debt again, due now to her and her husband's ages, was both truthful and insightful (see ts 111). She explained to me, frankly, that she and her husband were not prepared to put their house on the line, given she was 67 and he was 74, observing by reference to their house that '...we are not prepared to lose it'. The observation was made in the context of the refusal by Westpac of the Reynolds' enquiry seeking to borrow $3,200,000, which was a proposal concerning their interest at the time in possibly acquiring as business premises 2 Harrison Road, Forrestfield, at mid-2017. Their loan enquiry was ultimately rejected by Westpac (see ts 110).

'Value to the owner' and 'market value': legal concepts

1. The concept of market value and the scope for some greater level of value for the dispossessed owner, was the centrally disputed theme in the present trial - giving rise to the major economic tier of disputation as between the PTA and DBW.
2. In this realm I would, by reference to particular terms of s 241 of the LAA - which provides in some evolved contrast to provisions of the former Land Acquisition and Public Works Act 1902 (WA)) - first refer to some of the mere relevant case authorities below.
3. First, in his McKay reasons, Beech J, at s 2.2, at a heading 'General Principles', addressed the meaning of the word 'value'. That was in the context of Pt 10 of the LAA. His Honour then observed at [144] - [145]:

[144] Compensation for the value of the land involves determining a money equivalent of the asset: Housing Commission of New South Wales v Falconer [1981] 1 NSWLR 547, 570. 'Value' means exchange value. Value is determined by presupposing a person who is willing to give the thing that is being valued in exchange for money and another willing to give money in exchange for what is being valued: Spencer v The Commonwealth (1907) 5 CLR 418, 431; Boland v Yates Property Corporation Pty Ltd [1999] HCA 64; (1999) 74 ALJR 209 [79].

[145] In summary, value is determined by identifying the price of a notional bargain between hypothetical vendor and purchaser who are prudent, well informed and willing, but not anxious, to complete the exchange.

1. At [146] and [147] Beech J referred respectively to the often cited valuation observations made by Griffith CJ and Isaacs J in Spencer at [432] and [441] in that now famous case.
2. At [148] Beech J discussed more recent High Court of Australia case authority, including observations by McHugh J in Kenny & Good Pty Ltd v MGICA (1992) Ltd [1999] HCA 25; (1999) 199 CLR 413 [49] - [50]. Those observations by McHugh J had subsequently been approved by the High Court of Australia in Walker Corporation Pty Ltd v Sydney Harbour Foreshore Authority [2008] HCA 5; (2008) 233 CLR 259 [51]. In the passage as cited McHugh J had said:

Value is determined by forming an opinion as to what a willing purchaser will pay and a not unwilling vendor will receive for the property. In determining that value, there must be attributed to the parties a knowledge of all matters that affect its value. Those matters will include the predicted impact of future events as well as the experience of the past and the rates of return on other investments. As Isaacs J pointed out in Spencer v The Commonwealth:

'We must further suppose both to be perfectly acquainted with the land, and cognisant of all circumstances which might affect its value, either advantageously or prejudicially, including its situation, character, quality, proximity to conveniences or inconveniences, its surrounding features, and then present demand for land, and the likelihood, as then appearing to persons best capable of forming an opinion of a rise or fall for what reason soever in the amount which one would otherwise be willing to fix as the value of the property' (emphasis added by McHugh J).

The market for the property is, therefore, assumed to be an efficient market in which buyers and sellers have access to all currently available information that affects the property [49] - [50]. (footnotes omitted)

1. Returning to McKay at [149] - [150], Beech J then continued:

[149] The hypothetical purchaser should be regarded as prudent: Spencer (440 and 441); Mount Lawley Pty Ltd v Western Australian Planning Commission [No 3] [2008] WASCA 158; (Mount Lawley [No 3] [2008)) [25]. Consistently with that, the hypothetical purchaser is to be taken to act rationally: Mir v Valuer-General [2009] NSWLEC 139 [43] - [45]. I think the same notion is implicit in what Callinan J said in Boland v Yates [265] - [269], in contrasting the artificial exercise of identifying the price of the notional bargain with the real world in which sentiment and emotion may significantly influence decision‑making.

[150] The value determined in the way explained above reflects market value.

1. Centrally, however, for the present dispute arising over 'value to the owner', Beech J added the observations:

[151] In some cases, land may have a 'special value' reflecting a value to the owner over and above the price which a hypothetical purchaser may pay. See, for example, Boland v Yates [16] and [292]; Mount Lawley Pty Ltd v Western Australian Planning Commission [2004] WASCA 149; (2004) 29 WAR 273 (Mount Lawley (2004)) [281] - [287]; Arcus Shopfitters Pty Ltd v Western Australian Planning Commission [2002] WASC 174; (2002) 125 LGERA 180 (Arcus Shopfitters (2002)) [70] - [75]. In this case, the plaintiffs made no claim of special value to the owner.

...

[153] Whatever method [of assessing value] is used, it must be borne in mind that the method is only a means to an end. The end - the ultimate task - is to identify the price at which the hypothetical Spencer parties would reach a bargain: Brewarrana Pty Ltd v Commissioner of Highways [No 2] (1973) 6 SASR 541, 559 - 560, 576 - 678; Minister for the Environment v Florence (1979) 21 SASR 108, 116 - 117; Minister of Environment v Petroccia (1982) 30 SASR 333, 362; Kelly v Western Australian Planning Commission [2006] WASC 208 [157] - [158].

1. As seen, the reference under [151] of the McKay reasons to 'special value' as reflecting a 'value to the owner' was addressed there by Beech J, albeit the issue itself, as he observed, did not arise in that dispute. As is well illustrated there, however, it is not uncommon to see the phrase 'special value' deployed alongside, or in conjunction with the phrase 'value to the owner'.
2. The importance of [151] albeit strictly obiter, is the observed acknowledgement of a feature potentially applicable to assessing value in a compulsory acquisition and compensation action.
3. For present trial circumstances, an additional claimed component of 'value to the owner', if applicable, is very important. That feature is relied upon by DBW to contend for compensation at a higher level above market value - and so, for a significant additional component under its s 241(2)(a) of the LAA level of statutory compensation sought for the taken land.
4. Before I leave the concept of value viewed more generally for the purposes of assessing compensation under s 241 of the LAA, I would also respectfully note observations made by Pritchard J (as her Honour then was) made in Kelliher v Commissioner for Main Roads [No 2] [2015] WASC 478. I refer to the observations commencing at [79] of her Honour's reasons under a heading 'The meaning of "value" in s 241(2)'. There, Pritchard J observed:

The effect of s 241(2) is that compensation is to be awarded for the value of the Taken Land, assessed on the Date of Taking. Compensation for the 'value' of the land taken involves determining a money equivalent of the asset. 'Value' means exchange value. In other words, the 'value' of something is determined by pre-supposing a person who is willing to give the thing that is being valued in exchange for money and another willing to give money in exchange for what is being valued.

1. At [80] and [81] her Honour proceeded to discuss the observations by Griffith CJ and Isaacs J respectively, from Spencer.
2. Concluding that section of her Honour's reasons at [86], she observed:

'Value' determined in accordance with the principles set out above reflects market value. In some cases, land may have a 'special value' reflecting a value to the owner over and above the price which a hypothetical purchaser may pay, but in this case, the plaintiffs made no claim of special value.

1. Again it may be observed from the observed [86] reference to 'value', that for the purposes of s 241(2) of the LAA the concept 'may' extend beyond market value, albeit the concept, as for McKay, was also not relevantly engaged under the facts of Kelliher.

1. Under the plaintiffs' written outline of opening submissions, the 'value to the owner' concept as invoked, is addressed in terms at par 55:

An important element of market value in this case is what is termed value to the owner. This can be an elusive concept and may cross over into special value depending on the facts...(my emphasis in bold)

1. That reference to this element of the DBW case for compensation as an 'elusive concept' invokes my wholehearted endorsement.
2. Nevertheless, the opening line of par 55, however, looks, with respect, to be erroneously stated. A level of 'value to the owner' compensation, by my assessment, would be measure of value that presents above market value - once a market value is determined by regard to applying the Spencer test methodology, as explained.
3. The plaintiffs' submissions then refer by way of attempted explication of the principle, to observations by Spigelman CJ in Leichhardt at [24] (endorsed by all members of that court). There, Spigelman CJ had said:

The traditional formulation of 'value to the owner' was developed as a gloss on the statutory words 'value of land' or equivalent appearing in a statute authorising compulsory acquisition. It was a unifying concept which encompassed 'market value', 'special value', 'disturbance' and 'severance'. 'Value to the owner' was not a concept which, at least in its origins, operated as an addition to market value. Rather market value was, in most cases, the way of computing 'value to the owner'.

1. The plaintiffs also cite further from the well-known text, Hyam, Land Valuation (4th ed) at 363:

This unifying concept was most commonly applied to increase the amount of compensation over market value when the land had a positive special value to the owner. (original emphasis)

1. They also cite from another valuation text, Brown, Land Acquisition (4th ed) at 99:

In ordinary circumstances the value of the land resumed is its market value. Over the years a separate principle has emerged that the resumed land may have a market value determined by the hypothetical willing seller and willing buyer test but may also have a special value to the owner over and above its market. The principle has its roots in Pastoral Finance Associated Ltd v Minister [1914] AC 1083 where the Privy Council placed the emphasis on the principle that the value to be established is the value of the land to the owner dispossessed.

1. In that famous 1914 Privy Council decision Pastoral Finance Lord Moulton, delivering the advice of the Judicial Committee, rendered at 1088, what have since been much discussed remarks concerning compensation, in terms:

Probably the most practical form in which the matter can be put is that they were entitled to that which a prudent man in their position would have been willing to give for the land sooner than fail to obtain it.

1. In 2023, the terminology of the passage, viewed in isolation, is somewhat apt to confuse, at least on a first read. Putting aside a dated reference to 'a prudent man', the reference can be understood as an attempted application of an objective test - using the standard of the reasonable person. But an ensuing ostensible difficulty is found in the concluding words, ie, 'sooner than fail to obtain it'. Of course, persons who as owners are having their land compulsorily taken and are seeking compensation must first be viewed as in the position of hypothetical sellers, rather than as a hypothetical purchaser. Consequently, that reference to 'what they would be willing to give for the land' looks, otherwise unexplained, to conflate a hypothetical 'purchaser' to that of a hypothetical 'vendor'.
2. Also puzzling is a reference to 'failing to obtain' the land - where obviously the taken land is already owned and the hypothesis is towards that land being disposed of by a person in the owner/vendor's position.
3. My difficulties with the Lord Moulton passage possibly aligns to earlier observations found in the reasons of the former Compensation Court of Western Australia - in St John Ambulance Association of Western Australia Incorporated v East Perth Redevelopment Authority [2001] WASC 85; (2001) 114 LGERA 112, by Hasluck J sitting with two valuer assessors (Mr R J Priest and Mr G I Gauntlett). I canvass some of those observations later from out of that 2001 decision, albeit noting that they were made at that time in reference to somewhat differently worded statutory language in the prior compensation legislation then applicable in this State, namely, the Land Acquisition and Public Works Act 1902 (WA) ss 63(a), (b), (d), 112 and 112(a).
4. As Spigelman CJ had observed in Leichhardt at [29], great care must be taken in importing case law applicable to a previous public works statutory compensation regime - when the terms of the Land Acquisition and Public Works Act 1902 (WA) whilst manifesting many similarities of concept to the LAA are, on my assessment, also textually quite different in some important respects.
5. An important textual change that arrived with the later LAA Pt 10 regime, saw the omission of any provision equivalent to the former s 63(c). That former provision provided the scope for a court, under that former compensation regime, to award greater compensation - to meet special circumstances of any case - where the court determined that extra compensation needed to be ordered to render compensation adequate for the compulsory taking under such special circumstances: see St John Ambulance at [81] - [83].
6. As mentioned, I will return to discuss further aspects of that 2001 decision later in the reasons.
7. Returning, however, to the contentious 'value to the owner' element of compensation, the plaintiffs' written outline of opening submissions also refer me to observations made by Callinan J in a 1999 decision by the High Court of Australia in Boland. There factually, a professional negligence action had been unsuccessfully brought against a solicitor and a barrister - by reference to an underlying owner's grievance that a claim for 'special value', supported by a so-called 'head start' claim, had not been properly pursued. That was the appellate context in which the 'value to the owner' concept came to be considered by a six‑member court.
8. Callinan J's observations on this issue, with Gaudron and Gummow JJ agreeing, are relied upon by the plaintiffs. The observations appear under a heading, 'Disturbance and special value to the owner'. The cited passage commences at [292] under Callinan J's observation:

I group these two topics together because although they are separate they are related concepts.

1. The passage relied upon by the plaintiffs (see par 64 of their written outline of opening submissions) is from [292] - [293], which had continued:

[292] The special value of land is its value to the owner over and above its market value. It arises in circumstances in which there is a conjunction of some special factor relating to the land and a capacity on the part of the owner exclusively or perhaps almost exclusively to exploit it. None of the examples given by the Full Federal Court are true examples of special value. There will in practice be few cases in which a property does have a special value for a particular owner. Obviously neither sentiment nor a long attachment to it will suffice. The special quality must be a quality that has an economic significance to the owner. A possible case would be one in which, for example, a blacksmith operates a forge in the vicinity of a racetrack on land zoned for residential purposes as a protected non-conforming use, the right to which might be lost on a transfer of ownership or an interruption of protected use. Such a property will have a special value for its blacksmith owner, and perhaps another blacksmith who might be able to comply with the relevant requirements to enable him to continue the use but to no one else. (my emphasis in bold)

[293] The Australian Law Reform Commission report Lands Acquisition and Compensation, with some slight adaptions goes some way towards correctly defining special value as 'that additional economic advantage which the owner obtains, by reasons of his ownership ... and which is not reflected in the market value'. [Footnote reference 284 of the reasons refers to the Australian Law Reform Commission, Lands Acquisition and Compensation, Report No 14 (1980), par 239].

The example which I have given answers this description. What Handley JA in the Court of Appeal regarded as special value in this case does not.

1. Whilst not directly relied upon by the plaintiffs' submissions, I must also mention Callinan J's further observations made in Boland towards the Privy Council decision in Pastoral Finance commencing at [349] and following. At [353], Callinan J observed:

In these circumstances it is difficult to see how Pastoral Finance can be regarded as a complete exposition of the law relating to special value, or as a case which holds that the possibility that the owner might make certain profits from the land but for resumption is to be treated as irrelevant. So to regard it would be to cast doubt on the availability of the hypothetical building method and also the discounted cash flow method of valuation in any circumstance ... The case is no more than an authority for this, and for the proposition that one way of testing whether there is 'special value' is to ask what the dispossessed owner would pay if he or she were the hypothetical purchaser. This is not the only way of defining or calculating special value and their Lordships do not suggest it is. (my emphasis in bold)

1. Callinan J continued his explication of the Pastoral Finance observations, at [354]:

There is another respect in which Pastoral Finance may need explanation. The concept of a price that a dispossessed owner would pay over and above the market price (if he or she were the purchaser) rather than lose the land may not be an entirely reliable guide to what the special value to the dispossessed owner is. In theory all that the notional purchaser need pay is a dollar more than the next available purchaser (without a special interest in the matter) would pay. In the highly artificial construct that the law requires in resumption cases, the formulation of the Privy Council in Pastoral Finance may only become workable if the dispossessed owner as notional investor be regarded as having a right to bid or fix a price which included special value. Another way of viewing the formulation of the Privy Council in Pastural Finance is to regard it as a means of ascertaining the value of the property to the owner. Part of the difficulty arises from a need or desire to ensure that an owner is compensated for the loss of value of the property to the owner, a value which may not always be the same as the value which the unqualified application of Spencer's case, an exchange value or sale in the marketplace, would yield. Sometimes such a need will involve a calculation of what might properly be called special value. The requirement, and I would regard it as a requirement now long accepted by the courts, of the various statutes providing for compensation on resumption, that an owner be paid the value to him or her, may mean that in some cases the direct and exclusive operation of Spencer's case may not be possible. No doubt that case will cover most situations although it assumes a willing vendor (the dispossessed owner), it does not contemplate one who would lightly relinquish a property which had a particular value to him or her for less than that value. Speaking of the provisions of the Land Acquisition Act 1906 (Cth) Dixon J in The Moreton Club v The Commonwealth said: 'It must, however, be steadily borne in mind that compensation depends upon the value to the owner dispossessed.' (original emphasis)

1. Callinan J concluded his observations with an expressed agreement with Dixon J's observations in Commissioner of Succession Duties (South Australia) v Executor Trustee and Agency Company of South Australia Ltd [1947] HCA 10; (1947) 74 CLR 358, 373 - 374, recognising a distinction in principle between valuing property for revenue cases, and for compensation cases, and by noting that in compensation cases, where there is doubt, the court's attitude is to resolve such doubts in favour of a more liberal estimate, whilst in a revenue case there is a more conservative estimate.
2. The plaintiffs' written outline of opening submissions also refer me to St John Ambulance, and to a passage in the reasons of the Compensation Court at, in effect, [92] - [93]. Those observations in turn refer back to the observations in Boland.
3. A passage at [92] mentioned in the plaintiffs' written outline of opening submissions, following reference to the Boland decision, mentions that the Compensation Court in St John Ambulance had observed:

The reasoning of the High Court suggests that unless a claimant shows that another method of determining the value of the land should be adopted, the generally accepted approach is to apply the market value approach in Spencer's case.

1. Pausing at that point, I reiterate that the those remarks in St John Ambulance were made in the context of a prior West Australian statutory compensation regime of compulsory acquisition as then considered by the Compensation Court in that decision. That should not be overlooked.
2. The Compensation Court had continued at [92]:

Where a claim for additional special value is concerned, the reason why there is an onus upon the claimant to substantiate the claim is because the claim is based on the vendor's peculiar perspective. Thus, a claimant may not be entitled to compensation for special value on the basis that its land could, in the future, be subdivided because this would be taken into account by properly applying the Spencer test. This seems to be the reason why three members of the High Court in Boland doubted Kennedy Street Pty Ltd v The Minister [1963] NSWR 1252.

1. Paragraph [93] from the St John Ambulance reasons is also relied upon, commencing at the second sentence of that paragraph. However, for complete context (which refers to a claim for consequential losses) I must cite it contextually, along with its introductory sentence, reading:

Further, if the claimant wishes to say that the special value of the land is to be measured by the cost of developing other land to achieve the same facilities as it planned for the resumed land, this is a claim for consequential losses caused by the resumption.

1. The passage as is relied upon from out of this paragraph by the plaintiffs submissions, had followed reading:

The claimant must show that there is a causal connection with such loss. Director of Buildings and Lands v Shun Fung Iron Works Ltd (1995) 2 AC 111 at 126. For example, if there is other available land which would allow the claimant to pursue its business equally well, the claimant would be unable to show that the resumption of land has caused any consequential loss. Realty Corporation Ltd v The Commissioner of Main Roads (1940) 14 LGR (NSW) 204 at 205. Accordingly, the claimant must show, on the balance of probabilities, that this is a type of loss which it has sustained, or will in the future sustain.

1. The St John Ambulance reasons proceed onwards from [95] to consider Pastoral Finance by regard to the observations made on that case by Callinan J towards the concept of 'special value' in Boland.
2. The Compensation Court then cites the article by Radford A E, 'Land: Market Value and Special Value in the High Court' (2000) 74 Australian Law Journal and Reports 773(November 2007) ('Radford Article') that issued in the wake of the Boland decision, with the Court then observing at [97]:

The learned author submits that special value is a quality of the land itself which is special only in the sense that it is a potentiality demonstrated by the use to which it has been put by the owner. This head of claim must be carefully distinguished from disturbance (which relates to costs flowing from the disruption of some business or activity), severance (which relates to damage caused to the land remaining) and solatium (being a sum of money to make up for loss or inconvenience). (my emphasis in bold)

1. The Compensation Court referred again at [98] to more observations in the Radford article at 780. The concluding two sentences read:

'...However, the [special value] claim must have nothing to do with the vigour of the personality of the owner nor sentiment for the land, nor the length of attachment of the owner to the land nor with the separate concepts of disturbance, severance or reinstatement of solatium. It must also be more than a potential of the land going to market value.' (my emphasis in bold)

1. I would place particular weight upon the last sentence above, as was cited by the Compensation Court from out of the Radford article - emphasising the need, as a matter of principle, to identify feature(s) in the land itself that are capable of exciting a higher offer from a potential purchaser over and above the market value of the land.
2. The Compensation Court also appears to have endorsed the Radford article observations at [99], by reference to the blacksmith example given by Callinan J in the Boland reasons:

In other words, the blacksmith owner, or the proprietor of land suited to an unusual activity which cannot be easily accommodated on another site, are in a position to advance a claim for special value, provided that the subject land is already being used for the special business or unusual activity.

1. Next, in terms of local case authority, I note the observations by Commissioner Pringle QC in Sharp v Western Australian Planning Commission [1999] WASC 223 at [74] and [77], albeit those observations do not appear to me to take matters further concerning this 'value to the owner' dispute. The case is relied upon by Century West for its reasoning to support its loss of a chance economic loss claim for lost revenue (by reference to [251] of Commissioner Pringle's reasons) (see ts 655). However, a close reading of the passage relied upon displays that the loss of profits awarded was made under the former statutory regime, including at then, s 63(c) of the Land Acquisition and Public Works Act 1902 (WA), at a time when there remained the scope for a court to award greater compensation, more generally. That is no longer the position under the LAA - since the scope for a court to render any greater sum became narrowed under the replacement legislation - towards now merely allowing the award of additional solatium under s 241(9) of the LAA.
2. In Arcus Shopfitters Pty Ltd v Western Australian Planning Commission [2002] WASC 174; (2002) 125 LGERA 180, Pullin J (as his Honour then was and who had been senior counsel before the Compensation Court in the St John Ambulance hearing) came to consider the issue of 'value to the owner' - again by reference to the former Land Acquisition and Public Works Act 1902 (WA). Pullin J had noted in particular (the former) s 63(c)(ii) concerning a discretion held then by the court to grant compensation for circumstances where an application of the provisions of the Act would not result in the assessment of compensation to meet the special circumstances of a case.
3. Concerning the 'value to the owner' principle, Pullin J's observations commenced under a heading 'Value to the Owner' at [69], with his Honour citing the same observations by Callinan J in Boland at [354] as I have now exposed (see [72] of Pullin J's reasons in Arcus Shopfitters).
4. I further note Pullin J's observations commencing at [73], concluding at [75] (albeit, again, made by reference to the now overtaken and replaced compensation legislation regime formerly applicable in Western Australia, prior to the LAA). He said:

[74] As a general practical proposition, a special value may be found in a positive advantage, or in an exemption from disadvantage, which the retention of the subject land would have directly conferred. Where a positive advantage is taken away by the acquisition, the claim is likely to be represented by the loss of profits or of other recurrent pecuniary gain derivable from the use and occupation of the retained land as part of the whole: Commissioner of Highways v Tynan (1982) LGRA 1 at 7.

[75] Special value to the owner is not to be ascertained by reckoning out savings and additional profits to be derived for the land and then capitalising those savings and additional profits: Yates Property Corp Pty Ltd (in liq) v Darling Harbour Authority (1991) 27 NSWLR 156at 176.

1. Finally, in the context of my review of local case authority potentially bearing on the concept of 'value to the owner', I reach the Court of Appeal's reasons in Mount Lawley, where Steytler P, Templeman and Simmonds JJ said:

[286] In our view, it is likely to be a rare case in which there is a difference between the market value of land and its special value to the owner. That is because the factors of special value are likely to be components of the market value which are recognisable as such by a notional vendor and purchaser who are 'conversant' or 'perfectly acquainted' with the land and all its features. (my emphasis in bold)

[287] Callinan J described 'special value' in the following way in Boland v Yates at [292]:

'... its value to the owner over and above its market value. It arises in circumstances in which there is a conjunction of some special factor relating to the land and a capacity on the part of the owner exclusively or perhaps almost exclusively to exploit it.'

Even if that test is applied to the additional components of value identified by the trial Judge in the present case, none of them qualifies.

[288] The cost of preparing the development application represents an amount expended to produce information about the use of the land that might have been permissible absent the reservations. It is the kind of expenditure identified by Callinan J in Boland v Yates at [271] - [273] which demonstrates the potential of the subject land. It is therefore reflected in the market value. There is nothing in that expenditure reflecting a capacity of the appellant to exploit the land that is exclusive or almost exclusive to the appellant. See also St John Ambulance Association of Western Australia Inc v East Perth Development Authority [2001] WASC 85; (2001) 114 LGERA 112 at [87] - [99]. This is even more clearly the case for the holding costs of the land and interest on the sale price until settlement, and the costs the appellant would have incurred in buying a replacement property.

[289] Those costs and that interest do not relate to attributes of the land, but rather, as the trial Judge acknowledged, to the particular sale transaction itself. They represent matters that do not go to increasing the value of the land, but rather to compensating the vendor for loss on delay in completion of that transaction and from being forced to find replacement property. The principle of s 36(2a) of the Scheme Act is that compensation is to be determined by fixing a price by reference to value as at the stipulated date, disregarding the stipulated items, and by the mechanisms indicated. That principle does not encompass compensation for other loss or damage, whether from dispossession or otherwise. Even in relation to resumption, the authorities from Spencer's case forward have clearly distinguished between claims for the value of the land and claims for 'damage otherwise': Issacs J, in Spencer's case at 438, quoted by Callinan J in Boland v Yates at [355].

'Value to the owner': four basic propositions from the case law

1. Out of these case authorities now discussed emerges on my assessment, at least four propositions in this area of 'value to the owner' or 'special value' in a compensation context around land resumption.
2. First, as observed by Spigelman CJ, then Callinan J and then later still by the Court of Appeal in Mount Lawley at [286], situations where there is a difference between the market value of the land and a 'special value' to an owner are likely to be 'rare' cases. That is because factors of so‑called 'special value' are likely to be components of market value recognisable under, in effect, the Spencer test by perfectly acquainted (with the land and its attributes) notional vendors and purchasers, as are objectively assumed.
3. Second, a claim predicated upon 'potential' for the subject taken land will be reflected in a correct derivation of its market value.
4. Third, 'value to the owner', or 'special value' does not encompass economic compensation for loss or damage arising by way of disturbance and dispossession. Such economic loss will be a separate claim, if available, to be pursued separately under the provisions of s 241(6) of the LAA.
5. Fourth, the terms of s 241(1) of the LAA render it absolutely explicit that in determining an amount of compensation to be paid for an interest in land taken under Pt 9 of the LAA, that 'regard is to be had 'solely' to matters as referred to in s 241.
6. Furthermore, it will be remembered that here, as a second plaintiff, Century West - as operator of a road haulage business operated on the land and obtained under lease from DBW - does pursue its separate financial loss claims for its economic disturbance and relocation expense losses said to arise out of a resultant early termination of its lease of its haulage business premises and so, a need for its subsequent relocation of that business to alternate (suboptimal, it says) leased business premises as were obtained (by it) at 415 Dundas Road, also in High Wycombe.
7. It is now appropriate to expose the precise text of the provisions of s 241 of the LAA that are relevant to arguments pressed in this trial.

LAA: compulsory resumption and compensation provisions

1. Part 9 of the LAA deals with the compulsory acquisitions of interests in land.
2. Within s 151(1), the word 'interest' (used vis-à-vis land) is defined for the purposes of pt 9 and pt 10 of the LAA. Relevantly, it means any legal or equitable estate or interest in land.
3. There is no dispute in the present trial that the freehold ownership interest of the first corporate plaintiff, DBW, which it held in the six lots at 249 Dundas Road meets the description of being an 'interest' in that land.
4. So also is it accepted that the leasehold interest as was held by the second corporate plaintiff, Century West, in the same land and upon which it had operated a depot and its transport and road haulage business, likewise meets the description, under s 151(1), of an interest in land.
5. Next to the mentioned as relevant, within LAA pt 9 div 3 of the LAA, are the terms of s 179(b). This reads:

On the registration of a taking order in relation to land -

(a) ...

(b) if the order provides that the land is taken - every registered and unregistered interest in the land not preserved under section 178(2)(a) is extinguished, and each person who formerly held such an interest has that holding converted into a claim for compensation under Part 10; and

1. Then, within pt 10 div 1 , I must mention s 202(1), relevantly providing in terms:

Every person having any interest in land which is taken under Part 9 is entitled, subject to this Part, to compensation for the interest from the acquiring authority. (my emphasis in bold)

1. Centrally then, under div 5 pt 10 of the LAA, I reach s 241. This key provision provides, relevantly:

(1) In determining the amount of compensation (if any) to be offered, paid, or awarded for an interest in land taken under Part 9, regard is to be had solely to the matters referred to in this section.

(2) Regard is to be had to the value of the land with any improvements, or the interest of the claimant in the land, assessed as on -

(a) in the case of an interest taken for a railway or other work authorised by a special Act - the first day of the session of Parliament in which the Act was introduced; or

(b) ...

(c) in the case of an interest to which paragraphs (a) and (b) do not apply - the date of the taking,

and discounting any increase or decrease in value attributable to the proposed public work.

(3) ...

(4) ...

(5) ...

(6) Regard is to be had to the loss or damage, if any, sustained by the claimant by reason of -

(a) removal expenses; or

(b) disruption and reinstatement of a business; or

(c) the halting of building works in progress at the date when the interest is taken and the consequential termination of building contracts; or

(d) architect's fees or quantity surveyor's fees actually incurred by the claimant in respect of proposed buildings or improvements which cannot be commenced or continued in consequence of the taking of the interest; or

(e) any other facts which the acquiring authority, the court, or the State Administrative Tribunal considers it just to take into account in the circumstances of the case.

(7) ...

(8) If the interest in land is taken without agreement, an amount considered by the court or the State Administrative Tribunal or, for the purposes of making an offer, by the acquiring authority, appropriate to compensate for the taking without agreement may be added to the award or offer.

(9) The additional amount under subsection (8) must not be more than 10% of the amount otherwise awarded or offered, unless the court or the State Administrative Tribunal, or, for the purpose of making an offer, the acquiring authority, is satisfied that exceptional circumstances justify a higher amount.

1. I note that s 241(7) of the LAA deals with circumstances in which not all of the fee simple land is taken from a holder with adjoining land. Such circumstances would give rise to considerations in relation to severance and injurious affection claims. But such circumstances do not present relevantly in this trial, given all of the land at 249 Dundas Road had been owned at the time of the taking by DBW Pty Ltd as trustee of the DBW Trust. Different factual circumstances concerning severance and injurious affection are found considered under my reasons in my earlier mentioned compensation decision under the same legislation, see Italiano.
2. Subsections 241(8) and (9) of the LAA deal with additional compensation components referred to as 'solatium'. In the present trial there is agreement that solatium amounts to the extent of 10% are to be awarded in accord with the provisions of s 241(8) - for each of the claims of the first plaintiff and second plaintiff. No arguments advanced by reference to invoking s 241(9) for the seeking of a greater award(s) of solatium under the exceptional circumstances criteria of s 241(9), was made in this trial.
3. Finally, subsections 241(10) and (12) of the LAA, says relevantly:

(10) If the interest in land taken produces any rent or profits, then at the option of the acquiring authority either -

(a) ...; or

(b) interest is to be paid on the amount of compensation for the same period at the rate of 6% per annum, or such higher rate as the acquiring authority, the court or the State Administrative Tribunal considers adequate, having regard to the circumstances of each case,

but if the interest in land ceases to produce any rent or profits after the taking, interest is to be applied in accordance with par (b).

(11) ...

(12) Subject to subsections (10) and (11) -

(a) when any amount representing an advance payment of compensation is paid to a claimant, interest on the total amount of compensation is payable only to the date of the first payment, and interest is payable thereafter only on the balance outstanding from time to time; and

(b) when any amount is offered by the acquiring authority as an advance payment of compensation under section 248 and the offer is not accepted by the claimant within 30 days of the day on which it was made, no interest is payable thereafter in respect of the amount so offered.

1. With the law and the relevant compensatory provisions invoked from out of the LAA now identified, it may be observed that the statutory provision of principal relevance to the present trial, concerning the level of claimed compensation for DBW's taken freehold interest in the land, is s 241(2)(a). As seen, the preface to s 241(2) refers to the 'value of the land with any improvements'.
2. Concerning the position of the second plaintiff, Century West, as the business operator of the road haulage transport depot and business from 249 Dundas Road - under a lease of the taken land from the first plaintiff - significant attention must be directed to s 241(6) of the LAA.
3. The preface to s 241(6) of the LAA refers, relevantly, to 'loss or damage' and then, in that respect, uses the word 'sustained', in reference to the loss or damage of a particular claimant.

Second plaintiff's claim for two sets of 'removal expenses': issue six

1. At the trial there was no conceptual disagreement between the parties against recognising the entitlement in Century West to advance a claim under s 241(6)(a) of the LAA for its removal expenses to its relocated business premises.
2. However, Century West then makes a claim for two tranches of removal expenses - given what is suggested as a first and mere 'temporary' move to 415 Dundas Road in 2016. But it also makes an extra claim for more removal expenses, seen as formulated by reference to the costs of a future and suggested more permanent move to unidentified business premises, albeit with no such further move occurring by the time of the trial, conducted in late 2022. The claim for two tranches of removal expenses calls for immediate comment.
3. The position of the defendant, the PTA, under its written outline of opening submissions accepts two amounts of relocation of expenses for Century West. That is first, in the amount of $95,433 for the so-called first and temporary move, then second, allowing an additional amount of $55,500 - in respect of a suggested future 'cost of relocation to permanent premises' as Century West's expenses anticipated, albeit it has not yet incurred by late 2022.
4. The second plaintiff's (Century West) claimed costs of the first relocation are sought at a higher sum, at $126,282 - as the first set of relocation expenses to the 415 Dundas Road location. That is a 'first move' amount difference of approximately $31,000 for that first tranche of relocation costs.
5. At the time of the trial in October 2022, the business location position for the second plaintiff, Century West, was that its lease over the so-called 'temporary' premises at 415 Dundas Road had been extended again and so, would continue on.
6. The defendant, in effect, will accept an obligation to pay the second tranche of relocation expenses claim at the amount of $55,500. Hence, I will allow it, given the nature of a compensation exercise following an enforced taking of an interest in land.
7. But on my assessment, the second relocation allowance amount sought by reference to s 241(6)(b) of the LAA, having not been incurred and with no other relocation business premises in prospect, is not justified in principle and should set no future precedent in other cases. Allowing a second tranche of relocation costs not incurred and not in prospect of being incurred at the time of trial, is, essentially, a windfall amount for the second plaintiff.
8. Assessed at the time of the trial, some 6 1/2 years after the taking and relocation of March 2016, taking account of the ages of Mr and Mrs Reynolds (discussed later) and their expressed positions in evidence against assuming future debt exposures as unpalatable at their ages, my assessment is that the prospect of any further business premises relocation of the road haulage business of the second plaintiff to another location, is highly unlikely.
9. Consequently, had the issue of a second tranche of relocation expenses been disputed and objection pressed by the defendant, I would not have allowed anything for a second tranche of relocation expenses - for a second, hypothetical future possible relocation of the Century West business to so‑called 'permanent' premises.

Second plaintiff's claims for economic losses: issues three and four

1. In the context of the second plaintiff's claim for loss and damage under s 241(6) of the LAA, my assessment is that some of the observations made by Edelman J in Lenz Nominees are relevantly instructive to present circumstances.
2. I should first observe that no reliance is placed upon s 241(6)(e) of the LAA by Century West, albeit that provision is invoked by DBW to support a stamp duty allowance claim for its purchase of residential land in Eagle Bay.
3. Towards s 241(6)(e) of the LAA, I refer to [423] of Edelman J's reasons in Lenz Nominees, where his Honour said:

Section 241(6)(e) does not permit the recovery of losses which have not been suffered for several reasons. First, s 241(6)(e) is concerned with loss or damage 'sustained' by the claimant. The focus of these introductory words of the section is upon loss or damage actually incurred. The words of s 241(6)(d) do not detract from this. Those words refer to architect's fees or quantity surveyor's fees 'actually incurred by the claimant in respect of proposed buildings or improvements'. The reference to 'actually incurred' narrows those fees which are recoverable. This is perhaps in contrast with s 241(6)(c) which may include future lost profits from the termination of building contracts. Or it could be to emphasise that only those fees incurred prior to the Taking are recoverable. (my emphasis in bold)

1. Here, it is s 241(6)(b) of the LAA that is largely relied upon to ground Century West's claims for the contended economic loss of future revenues under a lost chance of it securing future business opportunities - by failing to obtain a valuable storage contract that it says was seriously in prospect of being obtained with a third-party business client in 2015, namely, with Austral, prior to the taking of DBW's land and the loss of its lease.
2. Edelman J's observations made at [423] in Lenz Nominees, by reference to the word used in the preface of s 241(6)(e) of the LAA, namely, 'sustained', must in my assessment be equally applicable by parity of reasoning to a s 241(6)(b) claim.
3. In Lenz Nominees, Edelman J had earlier observed, by reference to case authority under the former compensation legislation, to the reasons of Virtue J in Konowalow and Felber v Minister for Works [1961] WAR 40,41, observing:

[417] The genus in s 63(aa)(i) - (iv), which Virtue J identified, is 'compensation for loss or damage resulting from interference with the activities being carried on by the plaintiff on the land'.

1. On my assessment, the conceptual character of the as-articulated loss of a chance claim raised by Century West - in respect of a claimed lost opportunity to win additional revenues potentially obtainable from the storage and consequent additional road haulage work from its existing customer, Austral - does not align to the legal character of a permissible claim for loss or damage that has been sustained, under s 241(6) of the LAA.
2. Nor, in my view, does that lost future revenue opportunity claim meet the threshold textual criteria of s 241(6)(b) - in regard to showing loss or damage suffered by reason of 'disruption and reinstatement of a business'. Hence, the claim is too wide by Century West.
3. A loss of the chance of gaining a future assumed profitable contract relationship, is a claim of a different ilk to a consequential loss and damage cause of action, as is envisaged by s 241(6) of the LAA. This claim must fail.

1. I turn back to the compensation issues concerning the claims of the first plaintiff, DBW. These chiefly concerns issues one and two, as identified earlier.
2. There is also an issue five claim for the stamp duty payable in respect of an acquisition by Mr and Mrs Reynolds personally of land at Eagle Bay. However as earlier explained, on my assessment, that claim plainly does not meet the criteria of s 241 of the LAA, in any respect and must be rejected conceptually.
3. In closing, the plaintiffs identified s 241(6)(e) of the LAA as their foundation of that claim.
4. Towards greater valuation and compensation issues one and two, I have earlier addressed the state of the law concerning 'rare' situations where, beyond market value, some additional component of 'value to the owner' can be allowed as compensation.
5. To that issue property valuation expert evidence was received concurrently at this trial, across almost two and a half days of expert evidence taken in a concurrent session. This process highlighted the issues of fiscal differences between the parties around DBW's claims. The major disagreements are tied back to the in-principle dispute over whether or not some extra level of 'value to the owner' compensation, is properly engaged with under the present compulsory acquisition circumstances and then, as to what otherwise should be the correct compensation amount payable to DBW under s 241(2)(a) of the LAA as the correctly assessed level of market value for its taken land, at 11 April 2013.

1. First, on my assessment, applying the observations cited I have cited from Mount Lawley at [286], by Callinan J in Boland and by Spigelman CJ in Leichhardt at [24], the present is not a rare or exceptional case. The correct ascertainment of a market value for the taken land, applying an objective approach long explained by Spencer, will take full account of all the laudable features of the taken land and of the efforts of Mr and Mrs Reynolds over time in assembling this aggregate parcel of land over years - for the purposes of establishing what was a very efficient road haulage transportation depot as its industrial use.
2. Second, any economic loss component in their (DBW's) 'value to the owner' claim, on my view, would be encompassed in the present claim for economic compensation jointly claimed by the related corporation, Century West, as operator of the business under lease from DBW, as a related corporate owner.
3. Third, a recurrent feature encountered in the plaintiffs' approach to this compensation exercise was to contend that because the first plaintiff's land had been compulsorily taken from it, that its right to statutory compensation was to be assessed on the basis of something akin to tortious reliance loss damages. The plaintiffs' position, expressed constantly, was that they ought to be restored back to the same position, in effect, to the exact dollar by statutory monetary compensation, so as to, in effect, transplant and relocate both plaintiffs to almost identically reconstructed replacement premises that would replicate every equivalent feature to the former business premises once owned, or as leased to the second plaintiff. That is rarely achievable.
4. As seen, the entitlement to statutory compensation under s 241(1) of the LAA is to be undertaken by 'regard ... solely to the matters referred to in this section'.
5. The major claim (stamp duty for Eagle Bay aside) of the first plaintiff, DBW, is, in effect, as landowner - by s 241(2)(a) of the LAA by reference to the 'value of the land with any improvements'.
6. The claim of the second plaintiff by s 241(6)(b) of the LAA is by reference to its claimed financial loss and damage 'sustained', by reason of 'disruption and reinstatement of a business'. Solatium claims advanced by both the first and second plaintiff are agreed at 10% of the amounts otherwise ordered.
7. No reliance or claim for a greater award of solatium above that 10% level, upon a basis of 'exceptional circumstances justify[ing] a higher amount' by s 241(9), is advanced at the trial.
8. No doubt the human actors constituting the corporate boards of management of the first and second corporate plaintiffs (Mr and Mrs Reynolds) were genuinely aggrieved, frustrated and disrupted by the compulsory taking of their assembled land for the purposes of the Forrestfield-Airport rail link public work. But they are elements of distress or frustration that are addressed under the grant of solatium.
9. The plaintiffs' third misconception is to stray too far from the command in s 241(1) of the LAA, by which regard is to be had 'solely' to the parameters of the legislation.

The property valuers' expert evidence at the trial

1. The defendant relied on the expert reports and evidence of two expert property valuers - Mr Jonathan Fyson and Mr Dale Hall. Their valuation repots with their subsequent revisions or adjustments made closer to the trial commencing, were tendered. They became exhibits 25 and 26 (Mr Fyson) and exhibits 27 and 28 (Mr Hall).
2. Likewise, the plaintiffs relied on two expert property valuers -Mr Matthew Garmony and Ms Jenny Le-Fevre. Their valuation reports, also with their subsequent revisions or adjustments made closer to the trial were tendered. They became exhibits 20 and 21 (Mr Garmony) and exhibits 23 and 24 (Ms Jenny Le-Fevre).
3. The four expert property valuers had earlier participated in a pre-trial conferral conclave - conducted under pre‑trial directions of the Court - well prior to the commencement of the trial.
4. As a result of that pre-trial conclave between the four property valuers, a good number of underlying details came to be agreed upon by them all.
5. That first conferral conclave exercise gave rise to an initial joint conferral statement, produced as between them all and filed on 24 March 2020 (see folio 50).
6. Appended to that document, commencing from page 18 (within its total content of 85 pages) will be seen an attached table - rendering their separate comments variously directed against the multiple assembled comparable sales canvassed in the exercise as between the four property valuers.
7. The four valuers later came to revise their initial conferral statement - but the revisions were only to the tabulated comparable sales materials. The original pages 2 - 17 of the joint conferral statement largely remained unaltered.
8. The expert property valuers' conferral statement as it came to be revised was ultimately tendered and received at the trial as exhibit 22 (usually referred to as the 'revised valuers' conferral statement').

Matters agreed upon between the expert property valuers

1. By reference to the various matters canvassed in conclave between the four valuers, it is initially convenient to see what emerged before the trial began as their unanimous agreement upon the matters below.
2. First is the date of the required valuation, which all the valuers (correctly) accepted was 11 April 2013.
3. Second, for present circumstances the relevant taking was over the whole of the property at 249 Dundas Road being held in fee simple by the first plaintiff , DBW.
4. Third, it was agreed the property address of the taken land was 249 Dundas Road, High Wycombe, with this parcel of lots also fronting to Imperial Street and Sultana Road West.
5. Fourth, it was agreed the registered proprietor in respect of each lot's title, was the first plaintiff, DBW.
6. Fifth, it was agreed that the tenure of the taken land was 'six separate titles'.
7. Sixth, it was agreed the interest to be valued was the unencumbered estate in fee simple subject to drainage easement and notification of the vicinity of Perth International Airport - with neither encumbrance considered to have a detrimental effect on value.
8. Seventh, in terms of relevant property details, there are seven components in what was agreed - with some supplementary comments by Mr Hall and Ms Jenny Le‑Fevre (see exhibit 22).
9. Eighth, all valuers agreed that the occupancy at the date of valuation was under a lease to the second plaintiff, Century West, observed to be a related business of DBW - and so, was considered for valuation purposes by them all to be owner-occupied premises. (Note: the corporate legalities of the leasing arrangements applicable as between the two plaintiffs in a context of a compensation claim, were discussed by me. Mentioned here is only the property valuers' as-agreed perspective upon the nature of occupancy of the taken land).
10. Ninth, the location agreed as between all valuers was noted as High Wycombe/Forrestfield - described as an expanding established industrial area in close proximity to Perth Airport. Dundas Road provided access to Abernethy Road, and to Tonkin and Roe Highways. Those four road routes are noted as being road train rated (alternately referred to being as a RAV 5 road - ie, thereby lawfully permitting road trains to drive over them - a feature not common to all public roads).
11. Tenth, it was agreed the relevant zoning and town planning regime applicable to the taken land, for the purposes of the metropolitan regional scheme, was an urban zoning (industrial zoning permitted) and in respect of the local authority, which was the Kewdale City Council - was town planning scheme 3 - zoned 'light industrial'.
12. Eleventh, importantly, all valuers were agreed that the highest and best use of the taken land was as the 'existing industrial use of the land as permitted - [highest and best] which provides [highest and best] value is the potential for individual sale of the lots as per the titles, or in "groups" of lots'.
13. Twelfth, the property valuers were mostly agreed that market conditions essentially had been improving to the date of the valuation, but started to decline in late 2013, to early 2014. The outlier expert in respect of that observation was Ms Jenny Le‑Fevre who, contrary to the views of Messrs Fyson, Hall and Garmony, observed:

A good industrial market steadily improving in 2013.

(Note: in that respect, if at all ever perceived later as important, I would prefer the preponderance of expert view expressed by the three valuers concerning a market decline in late 2013 to early 2014.)

1. Under items 13 and 14 of the revised valuers' conferral statement (exhibit 22), the valuers begin to diverge somewhat over the issue of the available valuation methodologies considered by each valuer.
2. Distinct potential valuation methodologies for the land look to be canvassed as between the four valuers to determine market value.
3. These were for assessing market value, by reference to (a) comparable sales evidence, (b) by a capitalisation method, or (c) by a summation method.
4. Mr Fyson considered comparable sales for vacant land only, then discussed the capitalisation and the summation methods - which last stated method he said he preferred.
5. By the time of the trial, it was said in opening by counsel for the plaintiffs that all four property valuers had ultimately favoured use of the summation method (which I will seek to explain later) to determine the market value of the land.
6. As mentioned earlier, Mr Hall expressed his view that 'value to the owner' was not present. He had considered all of the comparable sales, capitalisation and summation methodologies.
7. Mr Garmony, for the plaintiffs, like Mr Fyson, first addressed comparable sales from the perspective of vacant land, only. His preferred methodology was likewise the summation method. Mr Garmony also considered a hypothetical development approach for valuing the land, incorporating the existing six separate titles.
8. As stated by the revised valuers' conferral statement, Ms Jenny Le‑Fevre, for the plaintiffs, considered market value by reference to comparable sales. She also referred to the capitalisation method. At the opening of the trial, however, it was said for the plaintiffs that Ms Jenny Le-Fevre likewise favoured a summation methodology for the valuation - although that is not seen to be expressed for her in the revised valuers' conferral statement. Her position seemed to be that she firmly supported a finding of some additional 'value to the owner' component beyond market value.
9. Comparable sales are seen addressed as item 14 in the revised valuers' conferral statement. But a more helpful distillation towards the variously canvassed comparable sales emerged after lunch on day four of the trial, as I will explain a little later.
10. Item 15 assembles comments upon the variously considered comparable sales by each valuer - by reference to the attached schedule commencing at page 18 of the revised valuers' conferral statement.
11. Interestingly, seen at item 18 of the revised valuer's conferral statement, by reference to a heading 'compensation methodology' there looked then to manifest a reasonable measure of agreement as between three of the valuers over market value for the purposes of s 241(1) of the LAA. Ms Jenny Le‑Fevre, however, was again an outlier as between the four valuers, in terms of an additional premium of 8% she would have allowed, for the securing of ownership. I will return to discuss this conceptual divergence later.
12. All four property valuers, however, look to have said, under item 18 that there was no 'special value' (see page 13). Even so, there has since emerged a real divergence, however, concerning the applicability or otherwise, of any additional 'value to the owner' component.
13. By item 19 (spanning pages 13 - 17), three of the four valuers discuss a direct comparison method. However, Mr Hall said it was not used in his primary expert report of 22 August 2019 (exhibit 27).
14. Three of the property valuers then state they favour a summation valuation methodology (see page 14).
15. At the heading 'Summation Method', Mr Fyson notes this as, 'My preferred approach' (at the foot of page 14).
16. Like for Mr Hall, Mr Fyson's calculations under the summation approach as identified at page 15 came later to be revised, just prior to the trial commencing (see exhibit 26). By regard to that later opinion, Mr Fyson's market value result was increased to $8,500,000, reached on a basis of $569 per square metre.
17. For Mr Hall, by using the summation approach, his end figure for market value was $7,750,000 rounded - comprising a land value of $5,678,000, then adding the value of improvements at $2,065,000.
18. Mr Garmony, also expressly favoured the summation methodology valuation approach. As he explained in the revised valuers' conferral statement at page 14:

I have adjusted the land component in my Summation method of valuation for the whole site from $417/m2 down to $400/m2 which indicates a revised summation method of $9,360,000.

1. Ms Jenny Le‑Fevre assessed market value for the existing use of the depot, ostensibly arrived at by using the comparable sales method, arriving at $8,500,000. She then augments that amount by an advocated addition (as I read the remarks) of possibly three (alternate) 'value to the owner' assessment amounts. The first of those alternatives would add an 8% premium, thereby reaching a total of $9,180,000. Second, was her approach based on the replacement cost of land and improvements of the existing whole of site depot, reaching $9,550,700. Her third 'value to the owner' highest augmentation best use scenario, was at an aggregated value of $10,170,000.
2. The base line market value figure (ie, without any added 'value to owner' components) first arrived at by Ms Jenny Le‑Fevre, prior to adding any such extras, was at $8,500,000 - reached by reference to analysing of comparable sales. That figure happens to equate to the level of the revised higher amount that was arrived at by Mr Fyson - under his summation approach (see exhibit 26).

The property valuers' comparable sales evidence for the land

1. Across the course of two and a half days of the property valuers' concurrent evidence adduced at trial, the sales comparables addressed by their table in the revised valuers' conferral statement, came to be narrowed further - down from a starting position of 15 comparable sales as identified as sales A to O found in the revised valuers' conferral statement (exhibit 22).
2. In their respective expert reports the property valuers, as would be expected, located and examined various precedential prior sales evidence - bearing upon the valuation task towards the subject land and its improvements. The pros and cons of the variously discussed properties and comparative relativities vis-à-vis the land valued are found assembled across each report. There is necessarily a large amount of subjectivity as to pros and cons embodied in the comparative exercises.
3. It looks that a significant part of the expert conclave had descended into weighing rival arguments over the merits or demerits from a comparative perspective, of very large components of this earlier sales evidence.
4. The initial schedule to the valuers' conferral exercise was lengthy within the valuers' conferral statement filed on 24 March 2020 (folio 50). The original schedule to that document commenced at page 18 under the heading 'Table of Comparable Sales

- Valuers' and spanned pages 18 - 85, addressing 20 different suggested comparable sales. 5. Whilst no doubt prepared with the best of intentions, I found the first schedule to be oppressively unintelligible. When I pointed that out, in effect, at a case management directions hearing prior to the trial, the schedule was replaced. A revised valuers' conferral statement was filed on 18 February 2022 (folio 79) with its revised table of comparable sales spanning pages 18 - 54, across 15 comparable sales. 6. Again, however, the collective diversity of four sets of subjective views about the pros and cons of historic sales precedents from a comparability perspective to the subject land, were diversely stated. They lacked a centralised focus to assist this Court in resolving the major disputed issues of principle, rather descending into viewing subjectively held preferences, as will always present. 7. The four property valuers re-assembled in court to provide their concurrent evidence to the court in person, essentially on day four of the trial. At this time, their range of comparable sales addressed in the schedule to the revised valuers' conferral statement (exhibit 22) came to be narrowed further (see ts 89 - 292). There emerged what was offered then as an annotated page 7 of the revised valuers' conferral statement provided, essentially, as a navigational aid through the comparables schedule (this became Aide Memoire 1). 8. Mr Fyson, speaking at the time on behalf of all the property valuers, then explained (ts 289):

We've broken the sales down into, effectively, three categories. There is a fourth category. I will mention it at the end. Effectively, we've looked at what sales may apply to working out the value of lot 757 in isolation - or the land value for lot 757 as well.

1. The valuers had, in effect, as regards a first category of sales evidence, narrowed their comparables to sales A and E2.
2. Their second category as was explained towards the narrowed sales comparable evidence was 'for comparison of the whole depot site ...'. In this task the valuers identified as comparables their sales B, H and J.
3. A third category as explained by the property valuers was 'just to establish vacant land rates' (see ts 291). Here, a range of sales was identified for narrowed discussion by the valuers. The third category of sales included sales C, D, E1, F and G.
4. Mr Fyson added (at ts 291):

So they're the - they're the three categories. And Ms Le-Fevre also is keeping in ... sale M.

Not as a comparable sale but as indicated with the premium.

That was referring to the schedule to the revised valuers' conferral statement and to a sale M mentioned therein for 9 (Lot 889) Webster Road, Forrestfield at page 51 of the document and to Ms Jenny Le‑Fevre's observations at the foot of the page.

It is noted as local evidence of the market being prepared to pay a premium above market value to secure ownership ...

1. Some intensive questioning then ensued during the valuers' concurrent evidence over the merits and demerits of the narrowed down comparable sales.
2. Of the three categories of comparable sales now identified by the valuers, my assessment was that the greatest level of disputation, and the relative greater importance from a comparison perspective - concerned the third category of sales in relation to vacant land. This was of importance particularly towards the summation valuation methodology ‑ which separates a value for the improvements made to land away from the land's value assessed on an unimproved basis, then aggregates those two as-ascertained amounts.
3. During the course of this sales comparable evidence evaluation exercise - which took some time - I was driven to the need to invite the valuers, at just before lunch on day five (see ts 403), to rank in order of their preference the comparables under the third category of vacant land sales - in the order of their preference from highest to lowest. At the end of much examination and cross-examination over the vacant lot comparable sales, I had said:

Can I just ask all of you again, through this exercise, we looked at five comparables, and Ms Le‑Fevre has taken us to a sixth. That is number M. But we've looked at comparables: sales C, D, E1, F and G, with M involved. Again, I take it, there's no consensus between you in terms of a favourite out of those five.

1. Hence, I asked whether the valuers could rank for me the comparables by their preference from one to five, essentially so that I could gain some greater level of assistance to ascertaining whether or not there was a level of consensus about the more reliable of the sales evidence - in the wake of a day's evidence assembling differing perspectives, albeit across a narrowed field.
2. Mr Garmony then observed (at ts 405) it was likely that the ranking would be different as between the property valuers. That, of course, was the point towards my effort in attempting to ascertain some preponderance of professional valuation opinion - albeit acknowledging the high elements of subjectivity involved towards selecting preferred comparable sales.
3. Ms Jenny Le-Fevre (at ts 405) pointed out that in an absence of a directly comparable sale, in effect, there was a range and that:

... it's hard to rank them in terms of how they prove to be more comparable than the other.

1. Mr Fyson noted that towards so-called hinterland lots (being the lots other than Lot 747), that from the revised valuers' conferral statement there was (ts 405):

... a range between three valuers of 420 a square metre to 430 a square metre. So three - three are in that range for those five hinterland lots. So that's - that's a pretty - pretty tight range of three out of the four.

1. The four property valuers duly considered the ranking task towards the vacant land sales evidence over the luncheon adjournment and afterwards at the resumption, indicated to me their differing rankings.

1. Essentially, Mr Fyson and Mr Hall were of one accord for their ranking preferences of sales, C, D, E1, F, with sale G ranked least preferred in terms of preference (see ts 407).
2. On the other hand, Mr Garmony's preference ranking was for sale E-1, then F, D, G and C in that order (see ts 406). I found it interesting that the most preferred sale by Mr Fyson and Mr, being sale C, was the least preferred by Mr Garmony.
3. Ms Jenny Le-Fevre ranked the sales in terms of her preference, C, G, E and F together and sale D last (see ts 407).
4. A level of emerged consensus towards preference for sale C by three of the four valuers, was noteworthy. This was the sale in respect of the very same subject Lots 728 and 729 (Sultana Road West, High Wycombe), to the first plaintiff in 2012 and at a time less than a year before the valuation date at 11 April 2013.
5. As to sale C, Mr Hall's comment at page 24 of the revised valuers' conferral statement was:

CONSIDERED THE BEST INDICATOR OF VALUE FOR REAR LOTS WITHIN THE SUBJECT PROPERTY.

1. Under his primary report (exhibit 27), Mr Hall provided some revised calculations for his per square metre rates downward from $427 per square metre to $420 per square metre.
2. Mr Garmony, however, by his comments, had treated the sale with some caution - on the basis that it was an off-market transaction and in what he said were inferior market conditions.
3. Ms Jenny Le‑Fevre had observed at page 25 of the revised valuers' conferral statement:

Purchased as bare, serviced lots in 08/2012 for $400/m2 net of GST and since paved/drained, fenced and lit.

Market movement suggests an increase to $420/m2 as at 04/2013 plus the external works, to provide comparison for subject hinterland lots.

1. In the end, I am left more persuaded by the ranking preferences of Messrs Fyson and Hall (which are uniform) and are also in a broad alignment with the favoured comparable for sale C by Ms Jenny Le‑Fevre.
2. To the extent I need to prefer any property valuer's views concerning merits and demerits of the comparable sales in the overall valuation exercise, I was left, overall, more impressed by the intellectual coherency of the explanations as were provided during the concurrent evidence by Mr Fyson. To the extent his views differ from that of other valuers on this issue, then his perspective would, by my assessment, be the preferred approach.
3. In terms of differing views expressed towards the narrowed sale evidence in the first two categories, on my assessment, respectable rival perspectives were expressed by Messrs Fyson, Hall and Garmony. But again, to the extent that their perspectives differed, the coherency of the explanations provided during the concurrent evidence at trial by Mr Fyson - to the extent that it is necessary to select as between the property valuers - is my preference.
4. The second category of revised comparables was for use in assessing the value of the whole depot land - by the reduced number of sales, identified as sales B, H and J.
5. A last revised sale category of comparables advised, was from a perspective of assessing a vacant land rate. The comparison exercise narrowed, I was told, to a close consideration of sales C, D, E1, F and G.
6. Ms Jenny Le‑Fevre suggested adding separately sale M, as evidence to support her uniquely contended premium additional value approach used to support her 8% premium result (see ts 447 ‑ 448).
7. Before considering the property valuers' evidence any further, I need to briefly divert to address some evidence that was provided to them - from two rival quantity surveyor experts called by each side at the trial.

The quantity surveyors' expert evidence at the trial

1. For the purposes of utilisation as an input for the property valuers' reports in their respective tasks, the plaintiffs and the defendant each engaged an expert quantity surveyor.
2. To this end, the plaintiffs rely upon the evidence of Mr Paul Rafferty. It was provided by two witness statements. The first of these, filed 2 April 2019, became exhibit 13.
3. As usual, there ensued prior to trial, under standard pre-trial directions, an expert conferral session conducted as between Mr Rafferty, with the defendants' engaged quantity surveyor, Mr Stephen Bolt. Mr Bolt's expert report was filed on 2 April 2019 and it became exhibit 17 at trial.
4. That conferral exercise resulted in a joint conferral report of 23 May 2019 ('joint conferral report'). It became trial exhibit 15.
5. Mr Rafferty later provided a supplementary report under his supplementary witness statement of 23 March 2020 (exhibit 14). In this he now addressed a further task of providing a value for the demountable drivers' accommodation building owned by Century West (not DBW) - which formed a part of the transport depot operations on the land and was left behind for the defendant's use at its request.
6. Mr Rafferty's conclusions under his approaches towards calculating a reasonable value of the demountable building at 22 April 2013 under par 13 of his supplementary report, gave rise to the two alternative amounts relevant to issue seven in the trial. These were, first, the amount of $70,669, as is claimed by Century West and then $64,241 - as the lesser amount that will be accepted by the defendant. A grand difference of $6,428.
7. The lower amount above, as explained at par 11, was Mr Rafferty's written down value for the demountable asset at 22 April 2013 (excluding GST). The higher amount as was claimed by Century West, as explained at par 4, is explained by reference to Appendix A, as the base cost calculation made for constructing the transportable building (exclusive of GST), ie, without making any allowance for depreciation.
8. On my assessment, the lower (depreciated) amount as is accepted by the defendant is the more appropriate level for this aspect of the compensation payable to Century West under s 241(2) of the LAA, for the taken interest of Century West what was a tenants' fixture that was acquired.
9. The conceptual nature of a compensation exercise is concerned with the worth of the asset at the time it is taken, not with the cost of its hypothetical reinstatement afresh. Consequently, some proper allowance for depreciation to derive a written down value of this acquired demountable building asset at April 2013, is the more principled approach. But as should go without saying, that a 'fight' in the Supreme Court over just above $6,400, is 'not worth the candle'.
10. Returning to Mr Rafferty's evidence for the plaintiffs, he later provided a further expert report shortly before the trial commenced - under a third witness statement with multiple annexures filed 4 October 2022. This became exhibit 16.
11. Regrettably, much of the information provided within these annexures, and even in the annexures found with the joint conferral report, was assembled in a dense and indigestible format. In the end, by reference to a comparison of the end positions of Mr Bolt and Mr Rafferty (for 249 Dundas Road) by comparing annexure A (Mr Bolt) against annexure B (Mr Rafferty) in the joint conferral report, their rival positions can be captured and contrasted. It would have been more helpful to have been provided with a discrete comparative table showing the positions of the rival valuers for 249 Dundas Road in respect of 12 sub-elements they each sought to address.
12. By reference to annexure B, for Mr Rafferty's assessment, there must be an adjustment to exclude his item 4, which was described by him as the 'accommodation building', which he costed in the amount of $78,300.
13. Likewise, a $100,000 amount allowed by Mr Rafferty and Mr Bolt for 'demolition' is unwarranted in principle and should be rejected.
14. Mr Rafferty's allowance of $165,000 (item 7) for 'headworks', should also be rejected - this item is outside the scope of the task in terms of ascribing a value for the improvements found on the land at April 2013.

Rival positions of the quantity surveyors' evidence

1. At the conclusion of their concurrent evidence given at the trial I then attempted to distil and capture the quantitative differences that had then emerged, on my assessment, as between these two quantity surveyors (see ts 224 - 225).
2. Attempting to rationalise a quantitative gap between them of approximately $700,000, there essentially appeared to me then to be three main components constituting that gap amount.
3. These were first, towards costs for 'external works' (item 6), Mr Rafferty's assessed cost of $1,510,203, whereas Mr Bolt was lower at $1,165,543.60, a difference of approximately $344,000.
4. Second, in relation to the 'headworks' (item 7), Mr Rafferty was at $165,000. But Mr Bolt had considered this amount to be inclusive within the rates he had used so that the cost was thereby incorporated as a component of 'design fees', in the amount of $50,000 (in Mr Bolt's figure of $273,576.28). Mr Rafferty's design fee allowance had been revised to exclude headworks and to incorporate professional fees. That accounted for a difference between them of approximately $115,000 on item 7, after adjustments. As now seen, I reject this amount in any event, as a matter of concept.
5. The last major item of discrepancy presenting between the quantity surveyors was under their item 8, in respect of 'preliminaries (15%)' - with Mr Rafferty at $221,336.48 and Mr Bolt allowing nothing - on a basis this was included in rates otherwise used (see ts 225).
6. Those three gap amount differences accounted for approximately $670,000 of an overall $700,000 difference as between the April 2013 figure seen in annexure B for Mr Rafferty at $3,649,010.98, as contrasted in annexure A for Mr Bolt at $2,946,709.76.
7. My end assessment of all this quantity surveyor expert evidence is that it was apparent that both quantity surveyors were highly competent and articulate professionals, as well as being meticulous in their work. Criticisms directed at Mr Bolt in terms of his suggested over-reliance on using the data as was extracted by him from a widely used and industry respected Rawlinson's Cost Guide for some of his costing inputs - as opposed to Mr Rafferty's more organic efforts by reconstructing the level of costs for improvements by going back to the original plans and drawings - did not, on my view, provide any convincing basis for preferring the views of Mr Rafferty over those of Mr Bolt. Given what was a relatively low level fiscal scale for the overall exercise, I would commend the approach of not 'over‑egging the pudding', where possible.
8. Likewise, a criticised approach by Mr Bolt in terms of his working out a replacement cost to construct essentially the like array of improvements (to those on the taken land) upon the site at 2 Nardine Close, Forrestfield, rather than by reference to conducting the same exercise from inception tied to the site at 249 Dundas Road - again did not seem to me to provide a legitimate or convincing basis for differentiating as between the work of the two quantity surveyors.
9. Both reports should have their item four assessments seen in annexure A and annexure B respectively adjusted - by the removal of the 'accommodation building' (item 4), that saw Mr Bolt at a higher amount. This building is a tenants' fixture of the second plaintiff, Century West, rather than being an improvement component of the taken land from the owner, DBW.
10. Likewise, from a conceptual basis, I see no justification by principle for and would reject any 'contingency' allowance under the item 11 to remain, or for the allowing design fees and headworks. On my assessment, these were all sunken costs by the land owner. Likewise, a demolition fee under item 5 in both annexures also lacks a principled foundation. It will be disallowed. I am, as are the property valuers, concerned at the end with the concept of value, not the distinct concept of cost.

1. The quantity surveyor evidence was said to have been procured and assembled for a purpose of assisting the expert property valuers in their task, particularly by reference to assessing the value for improvements on the taken land, as at April 2013.
2. Accordingly, it was then for the property valuers to make such use of that quantity surveyor report material, as they saw fit.
3. I would observe that for most land resumption compensation cases, even when applying the summation valuation methodology (which attributes independent values for the land, then for its improvements, and ultimately aggregates those two sums), an experienced property valuer would usually not need to have recourse to a specialist quantity surveyor's report - minutely inquiring back into the cost of reconstructing afresh all the land's improvements. I repeat that the compensation exercise and the property valuer's task is, as a matter of principle, fundamentally concerned with the issue of value, not the cost of construction. Sometimes quantity surveyors will be able to provide what will be some relevant costing inputs - to assist with aspects of that ultimate valuation exercise. But primarily. it is for the property valuers themselves to receive, review, weigh, adjust and assimilate the costing input information they need and have at their disposal - as they see fit.
4. Here, the four property valuation experts were provided before trial with all the expert reports and as well, the joint conferral report of Mr Rafferty and Mr Bolt.
5. As I came to observe during the course of the trial, the contextual economics of engaging two quantity surveyors to effectively cost out, from inception, a hypothetical task of rebuilding all the improvements found on the taken land - so as to then derive a building construction cost at April 2013 for a purpose of ascertaining the market value of those improvements at the same time - presented here to me to be economically disproportionate, bearing in mind the relatively low scale of the amounts ultimately at issue in the present dispute. It also overcomplicated what should have been a more straightforward exercise in valuation.
6. Unless an expert property valuer explicitly says that a quantity surveyor's report is required for their purposes of reliably completing their valuation task, for most cases it is for the property valuer to utilise their own considerable experience and training. That will invariably extend to their access and use where required to historically collected industry cost referencing source pricing information - such as to be found in publications such as Rawlinson's Cost Guide for the appropriate historic times. Usually, the exercise can be left entirely to the industry property valuers who, by their training and day-to-day work, are very well familiar on a routine basis with those costing reference sources. Here, the scale of the quantity surveyor evidence adduced was disproportionate to the overall property valuation exercise to be undertaken. For the future, I would not allow it as a claimable disbursement, if claimed at a subsequent costs taxation - on either side.
7. But given such exercises by the quantity surveyors being undertaken, there can be no criticisms here directed towards any of the property valuers - by having recourse to this material provided to them. My wider point, however, is that the quantity surveyors' costing evidence is just one mere input - in a much greater dimension valuation exercise being undertaken by the property valuers.
8. The introduction of the evidence from two quantity surveyors' reports in the present case, bearing in mind the quantum of the dispute, was not, on my assessment, justified. What occurred here ought not for the future set a precedent as a course embarked upon - absent an expert property valuer first specifying their expressed true need for such expert quantity surveyor costing input information to be obtained.
9. I can now return to the property valuers' expert evidence.

The property valuers: general observations Plaintiff's property valuer: Mr Garmony

1. Mr Garmony's primary report of 23 August 2019, was exhibit 20 in the trial. Prior to the trial and in the wake of the revised valuers' conferral statement (exhibit 22), Mr Garmony had provided a second statement of 5 October 2022 showing some further schedules as attachments.
2. This became exhibit 21 in the trial.
3. Paragraph 7 of Mr Garmony's instructions of 1 May 2017 from Rowley Legal had asked him whether he required any legal advice on the issue of 'value to the owner'/'special value'.
4. Under section 11.0 of his primary report (page 20), Mr Garmony rendered observations under the heading 'Market Commentary'. He concluded at par 91 'there were a limited number of directly comparable sales leading up to and as at the date of valuation in the surrounding locality and those sales I have referred to are considered to be the most relevant'.
5. The most comparable sales evidence researched and analysed came to be addressed in the ensuing section concerning sales evidence, under section 11.1 of his primary report (pars 9 - 101).
6. At section 12.0, Mr Garmony at his heading 'Valuation and Comments', observed at par 102:

In determining the Market Value of the property, I have considered the following Methods of valuation:

Comparable Sales Method: Direct comparison of similar properties sold and leased.

Summation Method: Value of the land plus the depreciated value of the improvements.

Hypothetical Development Method: A method of feasibility analysis in which the development of the land is envisaged in a hypothetical exercise and all the estimated costs of the proposed development are taken into consideration. Probable net returns from the development are being calculated and tested for its economic liability.

1. By his primary report, Mr Garmony concluded the subject property had a market value on an as is basis of $9,625,000 (see par 154).
2. At the pre-trial joint conferral exercise undertaken as between the four valuers, as reflected in the revised valuers' conferral statement, Mr Garmony's input is recorded as (see item 19, page 14):

I have revised my direct comparison method for the whole site on an improved rate per square metre to range from $550/m2 to $600/m2 or $8,225,000 to $8,975,000. For the purpose of compensation, I have adopted the upper end value of the above range of market value as is of $8,975,000.

1. Applying his preferred summation method for valuation, Mr Garmony states, at the heading 'Summation Method' (page 14):

I have adjusted the land component in my Summation method of valuation for the whole site from $417/m2 down to $400/m2 which indicates a revised summation method of $9,360,000.

1. During the property valuers' concurrent evidence session at the trial, Mr Garmony confirmed those figures (see ts 344).
2. Mr Garmony then provided a second witness statement (exhibit 21), showing further valuation calculations that he said 'came out of the valuers' conferral' and which he annexed.
3. Most relevant of these further annexures was at the second last page - at which Mr Garmony addresses the comparable sales method and just above that, the summation method.
4. Within the summation method component, it is seen that his value attributed to the land component was at $400 m2 for just the land, and reaches $5,980,000.
5. To that he then adds a value for improvements - working essentially from figures provided to him by the plaintiffs' engaged expert quantity surveyor, Mr Rafferty, but which Mr Garmony depreciated at 5%.
6. The depreciated value attributed to the improvements would be $3,381,765 - if a uniform 5% depreciation rate applied to the improvement amounts.
7. His number for DBW would need to be revised downwards further, on my view, by excision of the improvement referred to as a 'drivers rest area' - at a depreciated amount of $74,385 (as this was a separate claim advanced by Century West for that demountable tenants fixture structure it owned and which was left at the defendant's request).
8. There had been agreement by the defendant to pay the depreciated value for this structure, but Century West sought, essentially, a higher sum.
9. This is the $78,300 figure as identified by Mr Rafferty and then depreciated by 5% to reflect its value at 11 April 2013 (being, in the result, $64,241).
10. Whilst the plaintiffs did submit otherwise, the depreciation of that structure, in my view, must be the correct valuation approach in principle - rather than simply allowing the full calculated replacement cost.
11. Also to be deducted are amounts for a so-called depreciated contingency (which cannot be supported in principle, given the nature of the exercise looking back, not forwards) in the amount of $161,037.
12. I also reject the as-claimed professional fees of $291,174. Notwithstanding an expressed change of heart at trial by Mr Garmony to seek then to defend those fees, on my view, they should properly be excised - as a fully sunk cost and not bearing on the market value valuation end task required.
13. An aggregation of those as-adjusted improvement amounts would see a revised value attributed to improvements under the summation method, fall from Mr Garmony from $3,381,765 (improvement amount with reductions after depreciation of $526,596) to $2,852,169.
14. Adding that as revised improvement amount to Mr Garmony's aggregate land value (of $5,980,000) would result in a revised summation method aggregate sum of $8,835,169.
15. That adjusted amount is roughly only $100,000 below Mr Garmony's comparable sales method approach towards ascertaining market value at $600 per square metre, deriving that way, a value of $8,975,000.
16. Other components in Mr Garmony's primary report addresses the disputed trial issue of principle ‑ over allowing an extra compensation component above market value, referred to as 'value to the owner'. To that end, I refer to Mr Garmony's observations in his primary report, exhibit 20, at pars 125, 126, 141, 143 and 156.
17. The amount of $12,743,500 is found at par 156 in the penultimate paragraph of the primary report (page 34) reached by reference to the calculation at par 141 to include a 10% solatium component - that I exclude for present comparison purposes.
18. Mr Garmony's 'value to the owner' amount (exclusive of solatium and consequential losses) was $11,585,000, seen derived under his par 126.
19. At par 125, Mr Garmony had explained:

I have utilised the same approach to determining individual lot values (Gross Realisation) as in my Hypothetical development method of valuation, and then I have added Stamp duty and Legal Fees & Professional Fees being additional costs that the acquiring owner would need to outlay in replicating the dispossessed lots. This amount reflects the total cost to the owner for the acquisition which equates to $11,585,000 exclusive of GST ...

1. Rejecting as conceptually inappropriate Mr Garmony's venture into 'value to the owner' augmentations, would see his summation method number of $5,980,000 for the land (at $400m2) with any revisions to reach an (adjusted) improvement number at $2,852,169, delivering a revised summation amount, of $8,832,169.
2. That number is broadly speaking within the range of the defendant's expert property valuer's (Mr Fyson) summation end amount of $8,500,000 - comprised by Mr Fyson's land component amount of $6,500,395 added to his depreciated improvements amount of $2,248,775.
3. Were Mr Fyson's 3% profit and risk discount as is mentioned by him at pages 15 to 16 of the revised valuers' conferral statement (exhibit 22) and under annexure JF6 to his witness statement of 21 September 2022 (exhibit 26) (generating the amount of $254,854) removed, Mr Fyson's summation amount is then $8,750,000 at 585m2 - even closer to Mr Garmony's revised number.

1. The plaintiff's second valuer, Ms Jenny Le-Fevre, arrived at a market value under the direct comparison method of $8,500,000 for the land.
2. She then ventured further into various 'value to owner' augmentations undertaken by various ways - initially by adding a further 8% component to that amount. However, that is not conceptually defensible - let alone by venturing towards even further 'value to owner' exercises generating even higher numbers. Held just to market value however, her $8,500,000 figure, is broadly, within the adjusted Garmony/Fyson range.
3. I refer to par 454 (page 55) of Ms Jenny Le‑Fevre's primary report of 26 August 2019, exhibit 23. I disagree and reject with her observation at par 455, reading:

Significantly, however, we have also concluded, that the value of the subject property assessed under s 241(2) of the LAA would be greater than market value as assessed under 'Spencer' due to the property's significant benefits. Within the market place these benefits would be likely to attract a premium from a similar occupier to the current owner, which can also be demonstrated as being part of the 'value to the owner'.

1. That approach is not conceptually justifiable.
2. Ms Jenny Le-Fevre also endorsed a scenario she explains across pars 481 to 498, concluding at par 500 at a figure of $9,000,000, reached on a basis that Lot 757 is sold off by itself for $4,700,000 and the other individually titled five lots are (referred to as the hinterland lots) sold off separately - providing for flexible site development or sale potential (see par 483, second dot point).
3. But applying that unique approach of Ms Jenny Le-Fevre, there would need to be a significant discount for risk associated with individual sales. Mr Garmony's as revised hypothetical development model calculation appended to his second witness statement (exhibit 21) for a static sale of individual lots, is seen to apply a profit and risk discount of 5% - resulting in the deduction to his calculations of $478,840.
4. Further and alternate 'value to owner' calculations, all resulting in even greater amounts and augmentations reached by Ms Jenny Le‑Fevre, are outlier views. They, on my assessment, lack the legitimate conceptual foundation - once a true market value for the land is objectively arrived at, applying the Spencer approach principles.
5. At par 19 (page 7) of Ms Jenny Le-Fevre's primary report (exhibit 23), it is stated:

We have assessed the market value of the property in accordance with the Spencer principle as if the vendor was willingly offering the property for sale on the open market, as a prudent and informed seller, with there being buyers of similar persuasion, with the market circumstances of April 2013. In accordance with Court precedent in compulsory acquisition cases, however, we have also assessed the value to the owner of the loss of the property, which loss may be greater than market value as assessed under the Spencer principle.

1. The second sentence observed above under that par 19, on my assessment, is a misconception of law as to so-called 'court precedent'. At her par 137, Ms Le-Fevre observes:

The primary valuation methodology adopted by us in assessing the market value has been by comparison and analysis of the market evidence of comparable or similar sales. The sub-section headed 'Comparable Sales Analysis' details our workings and the adopted reasoning.

1. Under the revised valuer's conferral statement (exhibit 22), very little was found there attributed by Ms Jenny Le‑Fevre as regards her applying the summation methodology valuation approach - that I could discern across pages 12 to 17 of that statement.
2. Nonetheless, counsel for the plaintiff opened the trial on the clearly stated basis that all the four valuers favoured the summation methodology approach.
3. That was certainly true in respect of Messrs Fyson and Hall as the two property valuation experts called on behalf of the defendant and as seen, also for Mr Garmony the first of the plaintiffs' expert property valuers
4. Ms Jenny Le-Fevre may have changed her favoured valuation methodology position towards the summation methodology, following the conferral exercise conducted as between the four valuers before the trial - for that methodology being attributed to her as her preferred method of analysis. I note, however, par 138 in Ms Jenny Le‑Fevre's primary report (exhibit 23) referring to the summation method as an approach she had 'also considered'.
5. Ms Jenny Le-Fevre's addressed the summation method by her primary report under the heading 'assessment by summation methodology' of (page 63 and following). At par 513, she wrote:

Summation does not address the issues which are reflected in the market return comparison such as suitability of the site and improvements, anticipated profit and risk compared with similar properties and market expectation, extreme economic circumstances and the like, and in commercial circumstances, therefore, it is considered as more of a check assessment.

1. I next mention the transcript of the valuers' evidence, commencing at ts 343 on commencement of their second day of concurrent evidence. I then had asked all of the expert property valuers to confirm their positions upon the summation method and the direct comparison method. At ts 346, I asked Ms Jenny Le-Fevre whether she expressed a methodology preference at all in terms of her approach. Her affirmative answer given then was to identify what was item 4 on page 14 of the revised valuers' conferral statement (exhibit 22). This approach incorporated a direct replacement cost for Lot 757 as a standalone depot, plus:

... the value of the individually titled other five Lots, less 20 per cent depreciation of the external yard works. And that comes to [$]10,170,000.

1. Albeit attributed to her, I struggle on the evidence as a whole to assess Ms Jenny Le-Fevre as having favoured the summation methodology approach. To the extent she did, she looks to have incorporated elements of a 'value to the owner', within it. That is evident at par 515 of her primary report, where she said:
   1. It can be appreciated that a purpose-designed and built property, although eminently suitable for other similar users, is likely to hold more value to the in-situ owner than it would achieve in an open market sale. In compensation, the test of the value of the owner's interest which has been lost, is how much the owner would pay rather than lose the property.
2. I further note Ms Jenny Le-Fevre's use of the joint conferral report of the quantity surveyors and the assessments by Mr Rafferty therein, concerning the estimated construction cost excluding GST at April 2013 of improvements at $3,649,010.98 (see pars 532 and 533). From that, she (rightly) excised the relocatable accommodation unit in the amount of $78,300, before reaching the amount of $3,570.700, including a contingency of 5% and professional fees.
3. Under par 539, by reference to improvements, Ms Jenny Le-Fevre appears to depreciate buildings at 8.33% and external works at 10% giving rise to a total depreciated replacement/summation value of (land included) $9,218,447. See also the conclusion summaries at par 567.

1. Mr Fyson's primary report is dated 21 August 2019 and became exhibit 25 at the trial.
2. With the other property valuers (Messrs Hall, Garmony and Ms Jenny Le-Fevre), Mr Fyson participated in the conferral exercise which took place in March 2020, before the trial.
3. Mr Fyson's evidence needs to be read and assessed with his later witness statement of 21 September 2022 (exhibit 26). This essentially, was provided with its annexures and with those revised calculations to amend and be incorporated into the primary report - in the wake of the joint conferral exercise. There were also some minor corrections made to his calculations as so revised, shortly prior to the trial.
4. Shortly, I will set out annexures JF1 and JF6 from within exhibit 26. Those tabulated calculations need to be substituted first for the table in Mr Fyson's primary report at par 323 and then, for annexure JF6, in lieu of a table at par 331 of the report.
5. Mr Fyson's annexure JF6 concerning his attributed land values for DBW's six lots from out of JF6 - needs to be substituted for numbers seen in the table at par 303 of his primary report.
6. Essentially then, as explained by his par 273, Mr Fyson used three different valuation methodology approaches towards an exercise of valuing the taken land and its improvements. These respectively were a direct comparison approach, the summation approach and an income capitalisation approach.
7. Discussion of the direct comparison approach commences at par 275, running to par 309 of the primary report.
8. Mr Fyson's summation methodology approach is canvassed, at between pars 310 and 340 of his primary report.
9. Utilisation of the income capitalisation approach essentially was used as a check. That discussion spans pars 342 - 381.
10. Mr Fyson's conclusions under pars 383 - 386 read (incorporating the adjustments delivered by reason of the revised calculations under the annexures to exhibit 26):
    1. The two assessments using the income capitalisation approach arrive at a considerably lower value range comparative to the summation and direct comparison approach where a market value of $8,080,000 was concluded.

[Note: Later Mr Fyson revised that amount to a higher figure, which I will canvass shortly.]

1. The subject property is in my opinion well suited to an owner occupier, and would appeal to this market segment. An owner occupier may be willing to accept a lower return and pay a higher value comparative to an investor for a property that suits their requirements, whereas an investor looks at the potential rental return or redevelopment prospects.
2. The subject property, given its use as a trucking depot, is underdeveloped at a site coverage ratio of 7.20% over the combined 14,950m2 landholding. The income producing built form improvements are somewhat minimal, with the site predominantly providing for bituminised hardstand. The summation approach recognises the high cost of constructing this heavy duty hardstand.
3. In recognising a dispossessed land owner, I have adopted the value arrived at through my direct comparison and summation approach at $8,080,000 exclusive of GST.
4. Subsequent to the joint conferral exercise between the four expert valuers, Mr Fyson expressed preference for the summation approach, given the particular circumstances. His revised figure as derived at the conferral and under the later calculations as seen in the annexures to exhibit 26, is at $8,500,000. At the trial during the concurrent evidence exercise, Mr Fyson indicated verbally that his direct comparison figure was at the lesser amount of $8,290,000 (see ts 343).
5. Given three of the four expert valuers had expressed by the end of the conferral process their preference for the summation approach and, indeed, it is said by counsel for the plaintiffs that Ms Jenny Le-Fevre also supported that valuation methodology approach, that is the aspect of Mr Fyson's evidence that I shall focus upon next.

1. First, I will set out the as-substituted tables that need to be incorporated into Mr Fyson's primary report, first, by reference to annexure JF1 from exhibit 26 set out below.

1. The annexure calculation to be substituted for par 323 of Mr Fyson's primary report sees him at the end, arrive at a depreciated amount for improvements as a component in the summation approach - with observed revised depreciation rates applied as against each of the six lots - culminating in the total depreciated replacement cost amount of $2,248,775.
2. As earlier observed, Mr Garmony's improvements component was higher. Mr Hall's revised number under his witness statement of 19 September 2022 (exhibit 28) was lower, using his somewhat differing depreciation rates to arrive at $2,065,000.
3. I would afford considerable weight to Mr Hall's assessment of a lower value for improvements, bearing in mind that he was the first of the property valuers to have conducted a physical inspection of the premises with those improvements in situ at the time. That was at 3 December 2015, for the purpose of him at then providing an earlier valuation report to the PTA (on which he was cross‑examined). That being his report of 18 December 2015 - but which was not in the end tendered in this trial. That valuation report document remained as MFI 30 in the trial.
4. Much of Mr Hall's primary report of 22 August 2019 (exhibit 27) is (as would only be expected) in similar terms to MFI 30. Mr Hall's earlier physical inspection (see par 21), in my view, put him in the best position of all of the four valuers to express a reliable view about the condition and worth of these improvements to the land - albeit Mr Hall did come later to revise downwards somewhat his initial chosen rates of depreciation, in the aftermath of the valuers' conferral.
5. So too did Mr Fyson under his primary report (exhibit 25). His extensive remarks about improvements and their condition as found in his primary report, commence at par 174 (page 22). They extend as to condition at par 214 and following (page 29). Then followed Mr Fyson's comments concerning the improvements under his general comments, commencing at par 240 (page 31) and following.
6. Mr Fyson mentions at pars 315 - 318 the expert reports of quantity surveyors called as the further expert witnesses in the trial

- namely, Mr Rafferty for the plaintiffs and Mr Bolt for the defendant. Their joint conferral report was similarly provided to the property valuer experts and is also mentioned by Mr Fyson (see exhibit 25, pars 26 - 28). 7. Mr Fyson weighed and took proper account, on my assessment of his evidence, of all the quantity surveyor information provided to him, including the differences between the two quantity surveyors. It was proper for him to take that course, because ultimately, the use made of such costing information provided is for the valuer to determine. As canvassed earlier, at the end of a day of concurrent evidence at trial from the two quantity surveyors, I came to ascertain that there was only a difference of approximately $700,000, as between them in their rival assessments of replacement cost for improvements. The property valuers would then apply their depreciation rate to that costing information, they assessed as appropriate for the valuation exercise. 8. No criticism can or should be directed to any of the four property valuers for revising their views in the wake of the joint conferral exercise. Such considered revision and narrowing of opinions is, indeed, the very essence of what that conferral process seeks to achieve - once all the various professional views are assembled, aired and robustly canvassed. 9. Mr Fyson's primary report after canvassing various comparable sales, pointed out (by reference to the location map at par 295) a position I would accept, indeed take to be relatively uncontroversial, at least as between himself, Mr Hall and Mr Garmony. Mr Fyson had said at par 301: * Whilst at the Date of Valuation the site was used as a single contiguous parcel, I have not treated the land as a 14,950m2 site but as six (6) individual lots with each having an individual title, dedicated street frontage and individual access (notwithstanding crossovers would need to be constructed on Lots 729, 739 and 741 if disposed of piecemeal / individually); * It is appropriate to treat the land as 6 separate titles given the advantages it affords the land owner, in the ability to individually sell off parcels in a variety of configurations. As the built form improvements are wholly within Lot 757 with no encroachment, individual lots could be readily sold without impacting on structural improvements and the continuing use of lot 757 in isolation. 10. At par 302 Mr Fyson said:

Based on my analysis of market evidence, I have arrived at the following underlying land values for the individual subject lots.

1. Mr Fyson's following table at par 303 came to be revised and read for the six areas, LV $/m2 and land value figures - as a subject of annexure JF6 in his witness statement (exhibit 26) and set out below ‑ without the value of the improvements.

1. The unimproved land value so derived was therefore $6,500,395. See as well, Mr Fyson's observations at pars 304 - 308 of his primary report.
2. Mr Fyson then advanced from par 310 to address the summation approach. At par 331, he incorporated the unimproved land values for the six lots into the computation (revised by reference to annexure JF6 in his witness statement).
3. Towards the value of the land's improvements by annexure JF6, however, par 323 of his primary report shows that their derivation once assimilated with the updated annexure JF1 - which I have incorporated earlier as observed from the revised computation conducted in respect of each of the six lots, applying revised depreciation rates.
4. So seen, Mr Fyson reaches a total depreciated replacement cost for improvements of $2,248,775. By par 331, as revised by annexure JF6, he incorporates that value for the improvements across the six lots to reach the summated value for land and improvements.
5. Mr Fyson's aggregate sum of $6,500,395 for land value is then added to the depreciated value of the land's improvements at $2,248,775 - to generate $8,750,000, or $585 per square metre.
6. Under his annexure JF6, Mr Fyson then applies a 3% discount for profit and risk ‑ associated with a sale of the individual lots (and see page 15 of the revised valuers' conferral statement (exhibit 22) for Mr Fyson's comments made). He observed:

My assessment allows for a small [profit and risk] factor to reflect costs to sell off lots individually (reinstate fencing, crossovers plus a small return for time to do so).

1. That discounted amount of $254,854 (3% of the aggregated sum of $8,750,000) came to be strongly challenged during Mr Fyson's cross-examination within the concurrent evidence exercise - by counsel for the plaintiffs. Nevertheless, on my assessment his discount is conceptually defensible and was appropriate, essentially, for the reasons then given by Mr Fyson towards any assumed individual sale exercise.
2. By contrast, Mr Hall had applied a bulk discount approach to the amount he derived for the value of the land at 10% (in the sum of $630,000). Weighing up Mr Fyson's profit and risk 3% discount figure and Mr Garmony's profit and risk discount of 5% (plus a 2.75% selling and marketing cost discount as is seen in the first of his revised tables in his second witness statement (exhibit 21)), at the end I would prefer Mr Fyson's profit and risk discount amount at 3%, as the more conceptually appropriate.
3. Upon the issue of the value of improvements as a component in the summation valuation methodology, I would note Mr Fyson's observations under pars 313 - 322 in his primary report (exhibit 25).
4. Commencing at par 319, Mr Fyson observed:
   1. For market valuation purposes, I have assessed the depreciated replacement cost of the improvements which when added to the underlying land value produce a total summated value.
   2. Such an assessment excludes items such as initial design and preliminary fees, being such costs already incurred by a developer. The market is not going to pay for these sunk costs when purchasing an improved property.
   3. I can however infer from the QS Joint Statement applicable square metre rates to apply to the subject improvements.

See as well Mr Fyson's earlier reference to the quantity surveyors' evidence at pars 26 - 28.

1. By my assessment, that was the preferred approach, as followed by Mr Fyson. By contrast, the approach of the plaintiffs by seeking to directly import Mr Rafferty's calculations for cost (subject to adjustments), was unduly complicated. Here, I accept the submission of the defendant in closing that such an approach effectively comes too close to conflating what is always the distinct concept of cost (ie, a replacement cost in reconstructing afresh the improvement structures by reference to historic cost information that is proximate to the valuation date), with the more relevantly applicable concept of value.
2. Ultimately, a costing exercise will only generate what is an input factor of cost data for the valuer to weigh and apply. To be clear, this is not a criticism of the property valuers for having had regard to the quantity surveyor information which was provided to them for the present exercise by those instructing them.
3. Absent much greater economic stakes, a valuation task for statutory compensation ascertainment purposes, should usually be left to the property valuers - without the need to go to the costly lengths of reconstructing multiple counterfactual rebuilding construction cost inputs towards the finding of a replacement cost for the land's improvements by recourse to quantity surveyors.
4. A hypothetical Spencer purchaser for a property of these dimensions, whilst fully informed, would not be expected to go to the length of engaging a quantity surveyor, at no doubt very considerable expense, to provide input costing data for such an exercise.
5. Finally, once the adjustments that I have now assessed are appropriate are made to the figures used by Mr Garmony concerning the value for the land's improvements, as seen in his summation method table, the as-revised sum of $2,855,169 is reached. Mr Garmony favoured a uniform 5% depreciation rate - by contrast to the varying depreciation rates used by Mr Fyson and Mr Hall. But the end results, broadly speaking, fall within a reasonable range of each other. I prefer what I assess was Mr Fyson's overall, more measured approach used towards the valuation of the improvements under the summation methodology.

1. By my assessment the most convincing property valuation analysis from the four property valuers, was provided by the defendant's expert, Mr Fyson.
2. I refer to his primary report (exhibit 25), adjusted under his contributions to the revised valuers' conferral statement (exhibit 22) and later, as it was revised further under Mr Fyson's corrected calculations as the subject of his witness statement (exhibit 26).
3. Furthermore, once the analysis of the defendant's other valuer, Mr Hall (who from the outset had applied the summation methodology approach and had rejected any extra increments for 'value to the owner'), is adjusted to reduce his 10% bulk discount approach (seen in his witness statement (exhibit 28)) - then, to instead apply only a 3% discount to the land value by the profit and risk approach used by Mr Fyson, their end valuation results are not that far apart.
4. A 3% discount against a total land value of $6,308,000 reduces that sum by $189,240 - producing the adjusted land value of $6,118,760. Adding an amount for depreciated improvements of $2,065,000 produces a summated value for land plus discounted improvements of $8,183,760.
5. The contrast of Mr Hall's figure for depreciated improvements of $2,065,000, viewed against Mr Fyson's figure of $2,248,775 ‑ indicates a broad level of proximity in those amounts.
6. As a matter of fairness to DBW, I would in the end adopt Mr Fyson's higher figure for the improvements.

1. At the end then, the positions of the four property valuers towards market value (putting all distracting considerations about 'value to the owner' aside - as legal misconceptions for present circumstances), produces a summation valuation methodology approach between Mr Hall at $7,750,000, Mr Fyson at $8,500,000 and Mr Garmony at $9,360,000. Ms Jenny Le-Fevre expresses preference for a market value for the six lots of $8,500,000 by a direct comparison approach (see ts 345 - 346), but adding then an 8% premium under a straight line calculation to that value. Accordingly, she reaches $9,180,000 (as the first of her 'value to the owner' alternatives).
2. Ms Le‑Fevre's preferred methodology preference as a direct replacement cost for Lot 357 as the stand alone depot, plus the individually titled other lots less 20% depreciation of the external yard works, reaches $10,170,000 (see ts 236).
3. Within the overall exercise the number arrived at by Mr Hall, on my assessment, is a little on the low side, essentially accounted for numerically, by his 10% bulk discount, as was applied by him to the land value.
4. Ms Le-Fevre's augmentations beyond $8,500,000 under a so‑called 'direct comparison' approach present to me to be corrupted by her 'value to the owner' augmentations approach - which, as I have now explained, is not legally supportable.
5. That leaves the summation methodology amounts arrived at by Mr Garmony and Mr Fyson - as between which I would favour the force of conceptual reasoning by Mr Fyson.
6. That preference was reinforced by seeing all the valuers give their concurrent evidence in person at the trial and questioned about those views.
7. At the end, Mr Fyson and Mr Garmony were broadly, as I have earlier discussed, within range of each other - with their gap difference essentially being in their approaches to the value of improvements as inputs, under the summation method.
8. Since in the end I prefer Mr Fyson's approach, I will consequently accept and assess the level of market value compensation to DBW to be $8,500,000.

1. As earlier mentioned, I cannot conclude that this is one of those rare cases in which 'there is a difference between the market value of land and its special value to the owner' (see Mount Lawley at [286]).
2. That is because any such factors are likely to be components of the true ascertained market value, which are recognisable by the notional Spencer test for the assumed vendor and purchaser, who are 'conversant' or 'perfectly acquainted' with the land and all its features: Mount Lawley at [286]. Nor, in my view, can it be fairly said here that the corporate owner of the land, DBW, held any special qualities that, akin to a blacksmith with a non‑conforming use located near a race course example, as was given by Callinan J in Boland, supports a greater 'value to the owner' being found. In effect, this land owner, DBW, was passive. It rented out its premises to a related business operator, Century West. And as far as Century West is concerned, there is no recognisable concept of 'value to the lessee'.
3. These observations and conclusions will no doubt be said to not recognise the human realities of the Reynolds' control of both corporations. But they chose to use those lawful arrangements. They were not sham arrangements and the two entities they controlled, traded and paid tax on that favourably structured chosen basis. They cannot discard those corporate structures at their convenience for the purposes of a statutory compensation exercise following the taking of the land.

Misconceptions underlying the second plaintiff's claims for economic losses

1. Whilst denying they were attempting to lift, or to ignore corporate 'veils' associated with the discrete corporate identities of DBW (as the first plaintiff as a landowner and trustee of a discretionary trust) and Century West (as the second plaintiff as the lessee and corporate operator of the road haulage business), by my assessment, the as-advocated so-called 'global' or 'economic unit', or a 'joint enterprise' approach (see ts 14, opening submissions of counsel for the plaintiffs) - impermissibly asks this Court to do just that.
2. The suggested one 'economic unit' approach fatally infects the second plaintiff's loss claim as it came to be assembled for it by a business accountant expert witness at trial, Ms Jacqui Le-Fevre. Essentially, the approach seeks to show a compensable economic loss that is constructed as what is suggested to be an overall worse off cash position for a single economic unit - as a result of subsequent leasing arrangements entered by the second plaintiff, Century West, with an arm's length landlord for 415 Dundas Road at relocated business premises for the depot and business, following the end of its lease with DBW.
3. The problem with this one 'economic unit' approach to a statutory compensation claim (apart from a lack of any supporting precedent) is that it conflates amounts of interest paid to the bank by the land owner, DBW, upon its secured loans (interest only loans) - with the level of Country West's rent payment obligation due in respect of 249 Dundas Road, to its related parent lessor, DBW.
4. The rent payment arrangements for DBW by Century West were effected between two related corporations still under the common control and management of Mr and Mrs Reynolds - as their common directors. Unsurprisingly, there were at times generous accommodations that were family friendly and favourable to the business - as regards a flexible (non) pursuit of later or unpaid rent, on a deferred, or sometimes on a wholly written off basis.
5. By contrast, the much cooler subsequent arm's length arrangements entered as between Century West with a third-party lessor, that became applicable from March 2016 for the lease over relocated business premises at 415 Dundas Road then saw Century West enjoy no such waivers or payment latitude over the required meeting of all its rent payment obligations due as lessee on time and in full.
6. Century West was then required to pay all its rent due to its new landlord and in the initial stages of that replacement lease arrangement

- to provide a bank guarantee to secure that rent obligation. 7. The plaintiffs, on my assessment, seek at the trial to deconstruct for compensation pursuit purposes the legalities of the lessor/lessee relationship effected as between DBW and Century West, at 249 Dundas Road. This approach, in my view, is unprecedented, unprincipled and, in the end, unsustainable. 8. The suggested approach was rightly rejected in the expert evidence of the defendant's business expert, chartered accountant Mr Martin Langridge, in his report and by his evidence at the trial during a concurrent evidence session with Ms Jacqui Le‑Fevre. Mr Langridge's views, which I overwhelmingly prefer and would accept over those of Ms Jacqui Le-Fevre, correctly address the position as a matter of concept. 9. That, of course, is not to say a differently framed economic loss case, if run by the second plaintiff - by reference to it pursuing compensation for trading losses suffered by it and shown to be caused by the 2016 enforced relocation of its haulage business and the accompanying requirement to restart that business at less optimal leased premises - might not have been viably pursued. But it wasn't. Such a different loss case would need to have been grounded on evidence proving that an adverse trading performance in subsequent years was caused by the enforced move to newer or less suitable trading premises. 10. The use of a business structure involving two related corporations and a discretionary trust by Mr and Mrs Reynolds around the land holding ownership of their 249 Dundas Road properties and then, for running of a road haulage depot business thereon, is by no means an unusual business structure. No criticism is to be or can be made of them for owning land and operating their businesses effectively, under such protected and no doubt tax effective corporate structures. 11. Those chosen structures delivered the obvious benefit of protecting Mr and Mrs Reynolds against potentially unlimited personal liability exposures in respect of any business losses. 12. They also delivered a perpetual existence of two corporations and for the business, a much more advantageous corporate income tax rate regime upon Century West's net business income - at (25% or 30% corporate income tax) - at well below the current top marginal income tax rate payable by individuals (47% inclusive of levies). 13. Those beneficially enjoyed corporate holding and trading structures were no doubt chosen to deliver their benefits, but they cannot then be cast aside later merely because they present as less convenient for the purposes of pursuing a compensation exercise. That exercise must, by regard to s 241 of the LAA, be conducted solely by reference to valuing the discrete interests of a corporate land owner (DBW) and the corporate lessee/business operator (Century West). 14. Tax deductible rental income paid over to DBW by Century West (as an expense deducted against its operating business revenue) could of course be used as DBW saw fit - including to direct those received funds to meet its secured interest only loan repayment obligations to lenders on those business loans of DBW. 15. But none of that undoubted former convenience detracts from the true character of the legal relationships deliberately put in place as between the two plaintiff corporations. These were not sham arrangements to be casually ignored when inconvenient. The submission that either corporate plaintiff was economically harmed because Century West was forced to enter a new lease, whilst thereupon paying a lower level of rent to its new arm's length landlord, is a preposition that is simply not sustainable in principle.

Second plaintiff's claim for loss of a chance of a profitable contract

1. Century West claims in respect of lost business opportunity, or rather, the loss of a chance to achieve extra revenue under some promising discussions on that issue with a Mr Peter Slack (for Austral) towards perfecting a storage contract and further freight business resulting for that stored product by Century West, to the extent of generating future haulage work at the level of possibly, one road train per fortnight.
2. But my first assessment is that such an economic loss of a future business opportunity claim does, not fit the parameters of s 241(6) of the LAA. It is not, in other words, a loss that was ever 'sustained'. Some observations relied upon by the plaintiffs from Sharp must be seen as rendered then by Commissioner Pringle QC under a different statutory regime of the predecessor compensation legislation in this State - as no longer applicable.
3. Second, were I to allow the claim I would, following the approach of French J (as his Honour then was) in Sellars v Adelaide Petroleum NL [1994] HCA 4; (1994) 179 CLR 332 at first instance (as I discussed in Hughes v St Barbara Mines Ltd [No 4] [2010] WASC 160 at [908]), apply a substantial discount of at least 50% to the claim - notwithstanding some expressed enthusiasm of Mr Slack in his evidence (which I accept) towards the viability and prospects for such contractual storage arrangements in the future, for his then employer, Austral. But there still remained, on my view, a long way to go in negotiations before any enforceable contract generating such a revenue stream, was to be perfected, if it ever was. Commercial experience betrays that once lawyers and legal departments are introduced towards embodying enthusiastic commercial ideas into a legally enforceable agreement - that there is always a considerable potential for what first looks on the surface to be a promising deal to be completely derailed by the fine details emerging before pen is put to paper finally.
4. Consequently, were I to allow the Austral loss claim, I would need to heavily discount it, for the real prospect it might not have ever eventuated, or may have been derailed by other circumstances before it was perfected.
5. I would, in those circumstances, apply a discount of at least 50% to the Austral lost income claim of $803,100, resulting in an adjusted lost revenue in the sum of $401,550.
6. The alternative claim in respect of lost contracts, on my assessment, is insufficiently proved, notwithstanding Mr Reynolds' evidence concerning his optimism as to the prospects for Century West obtaining that additional revenue had DBW's land not been taken.
7. As I have mentioned, Century West also advances the further global or 'one-unit' loss claim expressed as the 'additional costs of leasing temporary premises'. In essence, this claim proceeded on the misconceived basis of suggesting a loss for Century West by reference to a gap between the level of the interest payments on an interest only loan from Westpac to DBW, when measured against the level of rent that Century West, upon relocating the road haulage depot business, now had to pay to an arm's length landlord under its new tenancy.
8. Despite the efforts of the plaintiffs' financial expert, Ms Jacqui Le‑Fevre, in her expert report (exhibit 31) to justify such a loss - it is a claim that is simply misconceived as a matter of principle.
9. That was the position well explained by the PTA's expert, Mr Langridge, in his expert report (exhibit 33), which I accept as correct. This claim must also fail as a matter of principle.

1. By reference then to the nine issues as were earlier identified at the commencement of these reasons, my answers for each issue can now be provided as follows.
2. Issue one - 'Value to the owner'.

Answer: There is no such component present in the present trial by reference to s 241(2) of the LAA.

1. Issue three - Additional costs of leasing temporary premises.

Answer: This claim is conceptually misconceived and fails accordingly.

Further, as the defendant correctly submits, any such additional costs would need to be set off against gains received by the reason of lower rent obligations for the second plaintiff, Century West, under its later lease of the new premises from a third party at 415 Dundas Road.

The relocation leasing arrangements delivered a regime of lesser rent for Century West with its new lessor, a fiscal advantage assessed by Mr Langridge to be of the order of some $990,000 better for Century West - which benefit would need to be brought to account.

1. Issue four - Claim for lost income from future opportunities denied to obtain profitable contract arrangements, which could not be taken up given the taking and the required move to less well configured operating replacement business premises by Century West.

Answer: First, I assess this claim as conceptually misconceived - by reference to s 241(6) of the LAA.

Second, in any event, as regards any assumed Austral revenues payable in future for storage provided and associated haulage work revenues anticipated, a discount of at least 50% would need to be applied towards any such lost future revenue opportunities for contingencies. The sum would also need to be set off against the benefit flowing to Century West by reason of its lesser level of rent payable at the new business premises as explained by Mr Langridge.

Answer: There is no principled basis for DBW to legitimately seek $36,545.89 in compensation for stamp duty paid on a later personal acquisition by Mr and Mrs Reynolds of a vacant property at Eagle Bay, on which they subsequently constructed a residence as a holiday home.

The claim is predicated on their suggested substituted purchase of an investment property - in lieu of 215 Dundas Road.

However, the claim is not permissible under s 241(2) or s 241(6)(b) of the LAA. The stamp duty as incurred and paid by Mr and Mrs Reynolds cannot be legitimately characterised as sustained by reference to the disruption or reinstatement of a business.

Answer: The defendant accepts responsibility for first tranche relocation costs in the amount of $95,433. But the second plaintiff, Century West, seeks a higher amount of $126,282 - a difference of approximately $31,000.

The difference was said to be attributable largely to wages of those permanent employees of Century West who had spent some of their employed hours performing duties assisting with the move to 415 Dundas Road and then, an imputed future wages cost attributed to staff costs for a future move to 'permanent premises'.

The defendant accepts overtime costs incurred in respect of the first move, are payable. The in-principle dispute, however, remains over the ordinary wages payable to full-time employees deployed by Century West, to assist the work relating to the move to relocated business premises.

In my assessment, the defendants' in-principle negative response, is correct. Wages for ordinary permanent employees would have been incurred and paid out in any event - unless they were laid off. Hence, they were a sunk cost that was already committed. There is no suggestion in the evidence of any employee being otherwise laid off.

As mentioned earlier, I would, given the eventual failure to relocate again to alternative business premises (other than to 415 Dundas Road), by the time of the trial - some six and a half years after March 2016 at the time, not have allowed any second tranche relocation costs for a further move.

Nevertheless, the defendant, having offered $55,500 towards the costs of such a second move, does not seek to resile from that position ‑ concerning that offering amount. Hence, for these unique circumstances, it will be allowed. However, no precedent is established by that payment in wider contexts.

The parties were also agreed concerning an amount to be allowed of $98,955 - as an assessed cost of the comparative inefficiencies incurred by the second plaintiff by needing to conduct its ongoing future business operations from the as-relocated premises at 415 Dundas Road. That sum is also allowed.

1. Issue seven - value of demountable building claimed at $70,699.

Answer: As earlier indicated, I would, in the end, allow for Century West what was the lesser sum depreciated amount identified in Mr Rafferty's report (exhibit 14) and is accepted by the defendant, at $64,241.

1. Issue eight - this is a sundries claim in respect of $25,336, said to be attributable to par 48 of the further amended statement of claim.

Answer: The plea identifies other costs as claimed by Century West in respect of providing a bank guarantee for its rent at the new premises ‑ required by the new arm's length landlord, plus more moving costs and for so‑called administration costs.

The defendant's position as indicated (at pages 61 - 63 of its written outline of closing submissions) will accept in principle lease costs and lease preparation fees - in the claimed amount of $5,695 towards the lease preparation and extension fees for a new lease at 415 Dundas Road.

The defendant accepts these amounts are prima facie claimable - but need to be offset against $925,000 in the level of reduced rents payable under the second plaintiff's new lease. I would accept that to be the correct position as a matter of principle.

That refusal result is also the end position - concerning a claimed amount of $23,350 as a rental bond establishment and service fee incurred by the second plaintiff. Again, whilst prima facie claimable, the offset against $925,000 in reduced rent must exhaust that claim.

A trifling amount of $781 is claimed for staff wages in respect of 'claim preparation'. However, the defendant's submission at page 63 of its written outline of closing submissions to the effect that this is not in the nature of a true business cost - but rather is for work relating to the claiming process. That, I accept, is correct as a matter of principle.

Likewise, that claimed cost must also be rejected on the alternate basis of it being an ordinary cost to business for work conducted as part of the duties of a regular employee, whose fixed salary would have been paid out, in any event, as a sunk cost.

Another component for $1,205 as interest on an overdraft taken out was said, by the second plaintiff, to fund its relocation to 415 Dundas Road. This is also rejected by the defendant.

The defendant says that the second plaintiff was entitled to receive interest on all advance payments and judgment sums pursuant to s 241(11) of the LAA. Consequently, it says that to allow this interest claim would be to wrongly double count. I agree and so, reject the claim for $1,025.

1. To the extent interest is payable under s 241(11) of the LAA, it was agreed between the parties at trial that interest would run from the date of the lodgement of the plaintiffs' claims, being 17 November 2015. I accept that to be the position.

1. By reference to adapting the tables found at pars 74 and 76 of the defendant's written outline of opening submissions (folio 88), being the defendant's claim positions by reference to the issues, I have added at the right a further column indicating the court's ultimate concluding position for each item.
2. The defendant's position is that advance payments comprised the vast majority of the sums to which the two plaintiffs are entitled.
3. The first table below sets out the claims by the first plaintiff, DBW, the defendant's position, and Court's various conclusions rendered by these reasons (highlighted items were not in contention.)

Value of the first plaintiff's interest in the land

$8,500,000 to $11,425,000, depending on methodology

1. The second table below sets out the claims by the second plaintiff, Century West, the defendant's position, and the court's various conclusions rendered by these reasons (highlighted items were not in contention.)

Other costs pursuant to paragraph 48 of Statement of Claim

I certify that the preceding paragraph(s) comprise the reasons for decision of the Supreme Court of Western Australia.