Mir Bros Unit Constructions Pty Limited v Roads and Traffic Authority of New... [2005] NSWLEC 419 | Case summary

JUDGMENT - On application for leave to reopen hearing 1 HIS HONOUR: The applicant brings a motion in which it seeks leave to reopen the hearing which has been completed with respect to the market value of the land acquired. That hearing took place on the 30 and 31 August last year and involved the receipt of written evidence, including detailed written material from valuers retained by the parties; a detailed analysis of that material in concurrent evidence given in the Court; a view by the Court and detailed submissions provided by counsel for both parties. I delivered my reasons on 2 September and determined that the market value of the land was $4,900,000. 2 It was agreed between the parties that it was not possible, at that date, to determine the applicant's claim for disturbance and, accordingly, that aspect of the matter was stood over, as a discrete matter to be determined at a later date. As far as the parties and the Court were concerned once reasons for judgment had been delivered in relation to the market value, that component of the litigation had been finalised. 3 The matter has been mentioned before the Court on a number of occasions since September last year and on each occasion the applicant sought further time to bring its claim for disturbance. Until very recently the applicant never suggested on any of those occasions that it wished to reopen the litigation in relation to market value. 4 Although I was anxious to ensure that the matter was completed, the respondent was prepared to consent to a number of adjournments which were granted. The respondent properly indicated to the Court that it did not wish to see the applicant's position in relation to disturbance prejudiced by reason of the fact that it was not possible at an early date to bring forward its case on that aspect of the matter. However, I have now fixed the hearing of the disturbance claim for 23 and 24 August, approximately one month from today. 5 The applicant, in bringing its motion for leave to reopen, seeks to reagitate three matters and submits that they could all be litigated on the dates provided for the further hearing. 6 The first matter sought to be reagitated is the proper application of the before and after method of valuation, which I utilised in reaching my conclusion in relation to market value. I utilised that approach, which was the approach taken by the parties' valuers, because, after consideration, I concluded that it was appropriate to derive the market value of the acquired land in that manner. Application of the before and after method requires faithful adherence to the relevant principles which include a proper analysis of the situation after the land has been acquired. In this case the evidence disclosed that the parcel of land from which the acquired land has been taken was large and, as against comparable sales, a discount for size was appropriate. With respect to the residue, it being a much smaller parcel, difference considerations arise which are reflected in my reasons for judgment. 7 The applicant seeks to reopen that aspect of the matter, not so much to tender any further evidence, and it is difficult to see what further evidence could be given in relation to that aspect, but to submit that the approach I took involves an error of law. If there be a legal question in that aspect of the matter and there is an error the appropriate forum for which to advance the argument is the Court of Appeal. Leave is declined in relation to that aspect of that matter. 8 The second question is in reality a matter of arithmetic. It is submitted that the calculation which I made when applying the adjustment relevant to consideration to the impact of the M7 contains an error of logic within the arithmetic. If that is the case then I would grant leave to reopen in order to amend the arithmetical calculation. The parties have undertaken to speak with each other about the matter and if they are agreed that an arithmetical error is contained within the calculation they will, on the resumed date, tell me of the error and I have indicated that I will then make whatever adjustment I believe appropriate to the market value. I do so mindful of what the High Court said in Smith v New South Wales Bar Association (1992) 176 CLR 256 at 265. 9 The third matter sought to be reopened requires a little more consideration than the first two. During the course of the hearing consideration was given to the impact which the provision of the M7 roadway may have had upon the value of land within the area of the land acquired. Because sales within that area were properly utilised to assist in determining the market value of the acquired land, it was necessary to ensure that any impact from the M7 which may have inflated the value of those sales could be identified and eliminated in order to derive a value which was faithful to the statutory requirements. 10 The issue, although not included within the pleadings, was identified by the parties well in advance of the hearing. It was referred to in the report of Mr Dobrow who was the valuer retained by the applicant, where the matter was discussed in a draft of the report which was served on the respondent on 23 August 2004. Issue was joined in relation to the matter and it was discussed by both valuers in their written material. It was also discussed in the evidence that they gave and submissions were received in relation to it. I gave particular consideration to this aspect of the matter in paragraphs 35 to 43 of my reasons for judgment. 11 Although, as counsel for the applicant points out, some complaint was made about the adequacy of the written material provided by the respondent's valuers prior to the hearing of this matter it was never suggested by counsel that the applicant was disadvantaged by the raising of the issue of the M7 and its discussion during the course of the hearing. No application was made for an adjournment to facilitate the acquisition of further evidence or to allow for any different consideration of the issue. 12 The applicant now seeks to bring evidence from a valuer, who was not retained for the hearing, who has apparently conducted quite a different analysis of the impact of the M7 to that which was undertaken by the valuers who gave evidence during the hearing. As I understand it, the further valuer has embarked upon an exercise of examining the influence of the M7 in the Preston area but also in other industrial areas, including Blacktown. The theory that the valuer apparently brings forward is that it is appropriate to analysis any adjustment necessary of sales within the Preston area by reference to impacts which can be identified upon the value of industrial land by reason of the provision of the M7 in Blacktown. 13 Apart from an analysis using sales at Blacktown the valuer also provides his opinion in relation to the matters which I considered in my previous reasons. His opinion is that those matters would require an adjustment for the M7 of nine per cent, a figure in excess of the seven per cent which I ultimately adopted in my reasons. The consequence would be that, leaving aside any analysis involving sales at Blacktown, if nine per cent was adopted, the compensation awarded to the applicants would be reduced from that which has already been determined. 14 The principles in relation to this aspect of the application were comprehensively considered by the High Court in Smith. In the joint judgment (page 266) it was made plain when considering such an application that it is relevant to enquire why the evidence was not called at the hearing. If there was a deliberate decision not to call it, that will normally be decisive. But if that is not the case, it is relevant to enquire whether the hearing is complete, if the reasons for judgment have been delivered and whether or not there may be embarrassment or prejudice to the other side by allowing the matter to be reopened. If that is the case then the rules relating to fresh evidence are suggested as providing a useful guide to the exercise of discretion as to whether or not the matter should be reopened. 15 In the present case it is apparent that a decision was made by counsel that the evidence that was available at the trial was sufficient and appropriate for the resolution of this issue. Although I infer that the further report which is now sought to be tendered was not available and the approach taken by that valuer had not be identified, nevertheless, it is plain that a forensic decision was made that the evidence which was available was sufficient to resolve the issue. 16 It will be the case in many valuation matters that a fresh mind may identify a different approach with a potentially different outcome to the valuation problem. The fact that this has occurred in this case is not a reason, in my opinion, to allow the applicant to reopen. 17 Furthermore, as I have already indicated, this matter has proceeded on the assumption that the market value issue would be determined as a discrete issue. Evidence has been tendered, submissions received, the matter analysed and my reasons for judgment published. In every sense of the matter that fundamental issue in these proceedings has been finally determined. 18 If I were to allow the matter to be reopened the respondent would be required to engage a valuer, perhaps the valuer who was already involved in the matter, to conduct quite a different and expensive enquiry into the sales now proffered by the applicant's proposed witness. No doubt the respondent's valuer would also want to conduct his own research to determine whether there were other sales which would confirm or deny the proposition advanced on behalf of the applicant. This would be likely to add significant cost burdens to the matter for which the respondent would most probably not be fully compensated. 19 As I have already indicated it is by no means clear to me that the approach which the fresh valuer takes to the matter could lead to an adjustment of the determination of market value which would be favourable to the applicant. However, even if that was a possibility, in the circumstances of this case I do not believe it would be appropriate to allow the matter to be reopened. 20 This case bears significant similarities to the decision of Talbot J in Wollong Pty Limited v Shoalhaven City Council (No 2), 122 LGERA 178. Although a significant difference to that case is the fact that, in the present case, orders have not been formally taken out, otherwise the relevant matter has been litigated. 21 The issue of the impact of the M7 has already been heard and determined. The opportunity to proffer an alternative approach to the resolution of that item was available to the applicant at the time of the hearing and, no doubt, a forensic decision was made that the basis upon which the matter was to be argued at that time was appropriate for its resolution. 22 It has not been suggested that there was previously any impediment to the applicant framing a case in the way now suggested, the inference being that it did not occur to the applicant's advisors at the time, or, if it did occur, they decided that it could not succeed. Whatever be the position, there is no circumstance arising in this case which, in my opinion, would justify reopening the matter and putting the respondent to the expense of preparing a detailed analysis of further sales and the task of rearguing that aspect of the matter. 23 A somewhat striking aspect of the present case is the fact that, although my reasons for judgment were given on 2 September 2004, it was not until 22 June 2005 that a motion was brought seeking leave to reopen: no explanation for that delay has been offered. 24 Accordingly, applying the conventional rules in relation to fresh evidence on appeal, there is nothing before me that would suggest that reasonable diligence would not have brought forward the suggested material by the time of the original hearing. To my mind, having regard to the evidence available to me, if an application had been made to bring fresh evidence on appeal in this case, that application would, in accordance with ordinary principles, have been denied. 25 Accordingly, although I am prepared to allow a reopening in relation to the arithmetical matter should an error be demonstrated, I am not prepared to allow a reopening in relation to what I have referred to as the first and third issues. 26 The respondent seeks the costs of this motion. Although in class 3 matters special provisions are made in relation to costs, the application in this motion falls outside those normal rules. It is a discrete motion brought by the applicant which has required the respondent to prepare and mount a case in response to it. 27 As the applicant has almost entirely failed in relation to the motion, with the exception of the arithmetical component, which is a minor matter, I am of the opinion that it would be reasonable, bearing in mind the need to ensure that a resumed owner is not unfairly impacted by the costs of any litigation, that I order the applicant to pay seventy per cent of the respondent's costs of the motion. 28 The orders are: 1. But for the second issue the motion is dismissed. 2. The applicant is to pay seventy percent of the respondent's costs of the motion. **********

Mir Bros Unit Constructions Pty Limited v Roads and Traffic Authority of New South Wales

At a glance

Court

Decision date

Before

Source

Judgment (11 paragraphs)

Parties

Cases Cited (1)

Cited By (8)