Rent rise quashed; court finds in favour of farmers

A land valuation tribunal ruling in favour of the owners of Minaret Station on Lake Wanaka is a victory for all pastoral lessees, the station owner says.

The Otago District Land Valuation Tribunal yesterday found in favour of station owners Jonathan and Annabel Wallis.

Mr and Mrs Wallis had appealed a Land Information New Zealand (Linz) valuation on their isolated 20,000ha Lake Wanaka property which would have increased the annual rent from $4900 to $105,600.

Mr Wallis said his delight was tempered because the ruling was subject to appeal, but he saw it as relief for farmers who feared being "rented off their farms by the Crown".

Judge Paul Kellar said this was a test case which would determine the legality of new methodology used by Linz to calculate the value of Crown pastoral lease land exclusive of improvements (LEI).

The previous government instructed that land valuations, which were completed every 11 years, should include an amenity value charge for non-pastoral values such as privacy and views of lakes, rivers and mountains.

In 2005 Linz calculated the LEI on Minaret Station at $2.772 million, giving a new rent of $62,370.

Linz reviewed that valuation again in 2007 and calculated the LEI at $5.980 million, which took the annual rent to $105,600.

Mr Wallis appealed, arguing that the valuation methodology used by Linz was not lawful and would also make high country farming unaffordable.

The tribunal decision released yesterday determined the LEI at $1 million which would put annual rent at $20,000.

The tribunal found Linz had set criteria for its valuers "to achieve a particular outcome".

"Those two Acts [Land Act and Crown Pastoral Land Act], as well as case law, provide valuers and others with due process to be followed. To produce a protocol at variance with the legislation is not a helpful approach in achieving a change to those Acts, and the tribunal is not the forum to initiate such a process."

Judge Kellar said pastoral leases were designed to protect the Crown's interest in the land while providing lessees with security of tenure and occupation as well as the risk.

The tribunal also found the land could only be used for pastoral purposes, restrictions which the Land Act acknowledged.

"To consider significant inherent values and amenity values as part of the LEI when assessing the rental value would be inequitable in the opinion of the tribunal, and the antithesis of the intent and direction of the legislation."

Mr Wallis said the ruling was relief not only to his family, but to all pastoral lessees, many of whom faced rent increases under the proposal which exceeded the gross income that could be earned off the farm.

"It applied to all the farmers and families who have marched on despite their very livelihoods hanging in the balance."