Woolworths Limited v Valuer-General

Judgment 1By notice of motion filed on 11 October 2011, Woolworths Limited ( Woolworths ) seeks leave to appeal pursuant to s 38(2) of the Valuation of Land Act 1916 ( the Act ) against the determination by the Valuer-General of its objection to the land value of land known as 2 Dursley Road, Yennora ( the land ). The land value for the land was determined by the Valuer-General on 20 January 2011 for base date 1 July 2010. 2As a result of receiving the valuation notice, Woolworths lodged with the Valuer-General an objection against the valuation, conformably with the Act , contending that the land value determined by the Valuer-General was too high. It contended that the correct land value was the sum of $25,000,000. The land value determined by the Valuer-General was in the sum of $27,500,000. The objection by Woolworths was disallowed. 3As it happened, the owner of the land of which Woolworths is a lessee, namely Tenstat Pty Limited ( Tenstat ), had also objected against the Valuer-General's determination of the land value. By its objection, Tenstat had contended that the correct value at the relevant date was the sum of $36,000,000. The objection lodged by Tenstat was also disallowed by the Valuer-General. 4Having taken the commercial decision that the difference between the land value as determined by the Valuer-General and that contended for by Woolworths was insufficient to justify the cost and expense of an appeal, Woolworths initially took no action in response to the Valuer-General's determination of its objection. However, unknown to Woolworths, Tenstat had filed an appeal to this Court pursuant to s 37 of the Act consequent upon the Valuer-General's disallowance of its objection . In those proceedings Tenstat has indicated an intention to maintain its contention that the land value is $36,000,000. 5The terms of the lease under which Woolworths occupies the land is a lease granted for a term of 42 years commencing on 28 January 1981. That lease has been tendered in evidence before me. One of the covenants in that lease requires that Woolworths pay "taxes and all impositions and outgoings of whatsoever nature" during the term of the lease. As a lessee liable to pay outgoings, including rates, Woolworths was entitled to lodge the objection to the land value that it did pursuant to s 29(1)(c) of the Act. Following disallowance of its objection, it was entitled to appeal to this Court pursuant to s 37(1) of the Act. 6Woolworths seeks leave to bring an appeal pursuant to that section because it is now out of time in which to commence its appeal as of right. The time fixed for the lodging of an appeal as of right by s 38(1) of the Act is 60 days after the date of issue of the Valuer-General's notice determining the objection to valuation. No appeal was lodged by Woolworths within that time. However, by s 38(2) the Court may allow an appeal to be brought after expiration of the 60 day period. 7The principles that guide the exercise of discretion allowing an extension of time for the bringing of an appeal of the present kind have been the subject of several decisions of this Court. Those principles are succinctly stated in the judgment of Preston CJ in Jassls Pty Ltd v Valuer-General [2006] NSWLEC 59 . They require that consideration be given to four matters, namely the length of delay, the reasons for that delay, the extent of prejudice caused to the Valuer-General if the extension is granted and whether the applicant for leave has an arguable case that the statutory valuation is either too high or too low. 8The time within which Woolworths was able to appeal as of right in accordance with s 38(1) of the Act expired on 21 August 2011. The delay necessitating an application for leave to appeal is a period of 54 days. That delay of almost 8 weeks needs to be considered along with the reasons for delay. As I have earlier indicated, following the disallowance of its objection, Woolworths took the commercial decision that the cost of an appeal was not warranted, having regard to the difference between the land value for which it contended and that determined by the Valuer-General. 9However, that position changed when it became aware, less than one week ago, of the appeal brought to the Court by Tenstat and the fact that Tenstat was contending for a land value of $36,000,000, a value that is $8,500,000 higher than that determined by the Valuer-General. The higher value for which Tenstat contends is significant to Woolworths not only because of the liability that it has under its lease to bear rates and taxes but also because the formula for determination of rent payable under the lease is related directly to the land value of the land. 10As a consequence, it is understandable that Woolworths now seeks to maintain, in its own proceedings, that the value should be of the order for which its valuer contends. There is now a difference of $11,000,000 between that land value and that for which Tenstat contends. In those circumstances, it seems to me that the delay of 54 days beyond the time allowed for appeal under s 38(1) is properly explainable and is not, itself, a basis upon which the Court should refuse the application for leave to bring the appeal. 11As was observed in Jassls , it is difficult to imagine a case in which the Valuer-General could assert that he is prejudiced by the commencement of an appeal outside the 60 day time limit imposed by s 38(1) of the Act . In the present case, I have evidence before me in the form of Exhibit A indicating that the Valuer-General neither consents to nor opposes the present application for leave by Woolworths. That Exhibit is a printout of an email communication to Woolworth's instructing solicitor. It is not suggested in that email that prejudice of any kind is sustained by the application presently made. 12The fourth matter to which consideration must be given in accordance with the principles summarised in Jassls is the existence of an arguable case . I have been provided with a valuation report prepared by Mr D Lunney, a qualified valuer who is known to the Court and whose evidence as an expert valuer has been received on a number of occasions. Mr Lunney's report concludes that the land value at the base date is $25,000,000. 13It is not my function in determining the present notice of motion to decide whether or not that valuation is correct. It is sufficient for present purposes that it is a valuation indicating that there is a serious issue between or among valuers as to the land value of the land. In short, it demonstrates an arguable case in favour of the land value for which Woolworths contends. 14For these reasons, I am satisfied that it is appropriate to extend the time within which Woolworths is able to bring its appeal pursuant to s 37(1) of the Act. Accordingly, I am disposed to make the order sought in the notice of motion. In making that order it also seems to me appropriate to make provision for a determination that the appeal by Woolworths be joined or heard together with the appeal by Tenstat. 15The formal orders that I make are therefore as follows: