Objections To Valuations

Press, Volume CV, Issue 31007, 12 March 1966, Page 10

Objections To Valuations

/THE owner, or any party A that has an interest in the land, has the right to abject to the Government valuation. The time available for such an objection is very short, especially as the objector, must supply his value of the property. There is of course the inevitable form and a fee, but in all fairness 1 doubt if the department would decline to investigate any objection simply because it was lodged outside the time set. The objector must state his value and he may object to the capital value or the unimproved value or both. The reason for the objection is that the Government valuation does not represent the true selling value as defined under the Act. The objector does not have to state this but he has to prove it. The only proof is the evidence of sales of comparable land. It should be noted that the onus of this proof is on the objector, not on the department. The act sets out very clearly the course available to the Valuer-General once an objection is lodged. He may make such inquiries as he thinks fit, he may alter the valuation to the objector’s figure or to an agreed figure, he may ! refer the matter to the Land Valuation Committee, or he ! may decline to take any action at all.

In general once a revaluation of a county is gazetted the District Valuer makes himself available for discussion with interested parties. If an objection is lodged the position is generally discussed with the objector, perhaps on the farm or in the office. If the parties are unable to agree either side may refer the matter to the Land Valuation Court. The case is first heard by the committee, which has a magistrate as chairman and either side has the right of appeal to the Land Valuation Court. There is a committee for each land district in New Zealand, but there is only one Land Valuation Court, with Judge Archer as president of the court. There is no law regarding the presentation of the case by the objector. He generally employs a practising valuer and a solicitor. There is no reason why he cannot present his own case and this was done quite successfully a while ago in the Otago district.

eases taken to the committee in Canterbury in recent years and I cannot remember a ease going on appeal to the Court. The decision of the Court is final, except on a point of law which can be referred to the Supreme Court. There is, however, one final action available to either side after the Court has pronounced its decision. This action has been taken so rarely that there is confusion in the minds of a lot of people as to what can happen.

If the Valuer-General thinks that the Court has fixed the value too low he may require the owner to accept his, the Valuer-General’s figure, or a figure agreed between the two parties. If the objector refuses, the Valuer-General may require the Crown to purchase the property at the higher figure, and the values are then adjusted accordingly. Just what does this mean? In a revision the capital value is fixed at, say, £30,000. The farmer objects and his value

is £20,000. The Court, on appeal, fixes the value at £24,000. If the Valuer-General is convinced that this is incorrect and too low he asks the objector to agree to- a capital value of £30,000 or he will require the Crown to buy the property at £30,000. The objector then either agrees or gets £lO,OOO more for his prop, erty than he believes it is worth. 1 do not know of any recorded ease where the Crown has actually acquired the property on these lines, but there could well have been some cases of negotiation between the parties following the judgment of the Land Valuation Court.

This type of action is not one-sided. The objector, too, has certain rights. If the owner of a freehold (not leasehold) property considers that, on appeal, the Court has fixed the capital value too high, he may request the ValuerGeneral to reduce the value to his (the objector’s) figure. This must not be less than the sum of any mortgages on the property. If the Valuer-Gen-eral refuses or declines to negotiate, then the objector may require the property to be advertised for sale at his figure or acquired by the

Crown at his figure. If a buyer comes forward the objector must sell. Consider the figures used before. Objector, £20,000; Valuer-General, £30,000; Court, £24.000. The objector requires the capital value to be reduced to £20,000 or the farm to be advertised for sale at this upset price. Again I do not know of this happening with a farm, but it has happened with a city property. As no buyer was forthcoming and as the Crown did not buy the valuation was reduced to the objector’s figure. In both these cases the party taking such positive action would have to be very sure of their grounds. The owners of the building mentioned knew that it was structurally unsuited for adaptation for any other purpose and that this would not be obvious to anyone other than an architect or engineer. Action as described by the objector or the Valuer-Gen-eral applies only to objections lodged following the normal five-year revision. It is not available for any of the “special” valuations that are required under the act. In this article I have endeavoured to set out impartially the provisions of the act. In Canterbury there have been very few objections taken to Court in the last 10 or 15 years, but there is always a lot of discussion on the subject of the Government valuation. This is used for the assessment of most local body rates, land tax. estate and succession duties, gift duty and stamp duty. In view of rising prices these charges tend to increase, and the blame is unfairly load’ed on to the method of valuation. The quarrel is not with valuation systems but with the methods and incidence of taxation and this is quite a separate proposition altogether. In the same way there are suggestions, with which I agree, that the time has come to review the unimproved value situation. It will, however, be a major task to replace it with something acceptable to all concerned and that could well take years. It should be realised that it would require the alteration, not only of the Valuation of Land Act, but also of a number of other acts which rely on the present interpretation of unimproved values.

There have been very few

This is the final part of an article by Mr M. B. Cooke, senior lecturer in rural valuation at Lincoln College, on the Land Valuation Act.