Which Act provided a compensatory framework for compulsory purchase?
Land Clauses Act 1845
What principle did the 1845 Land Clauses Act establish?
Compensation being the loss to the displaced owner based on the value of the land if the scheme were not there and not a value based on the intended use by the acquiring authority
I.e what is the loss to the owner of loosing this strip of land? Much different to market value
Give a case example and an Act example for establishing the value of land taken
Stebbing v Metropolitan Board of Works 1870
Channel Tunnel Act 1987
What are the main points in Stebbing v Metropolitan Board of Works 1870?
CPO for 3 graveyards owned by Stebbing the rector
Stebbing contended that he should get a value of the land reflecting its secular use
Judge concluded: ‘… It is intended that he shall be compensated to the extent of his loss and that his loss shall be tested by what was the value of the thing to him, and not by what will be its value to the persons acquiring it’
What was the situation regarding the Channel tunnel Act 1987
Landowners agreed to give up their land at a value that did not reflect the scheme
But they could not understand why they should part with land that was to be used for warehousing/offices as a level of compensation that did not reflect those uses
From which inquiry did the Market Value principle arise?
Scott Inquiry 1918
What did the Scott Inquiry 1918 find?
The “value/loss to the owner” principle was resulting on over generous compensation and suggested Market Value.
In which Act are the 6 Rules found?
Land Compensation Act 1961 Section 5
What is rule 1?
” no allowance shall be made on account of the acquisition being compulsory “
What is rule 2?
” the value of the land shall, subject as hereinafter provided, be taken to be the amount which the land if sold in the open market by a willing seller might be expected to realise “
How is development value treated with respect to market value under rule 2?
Whenever MV reflects development value then it can be assessed as part of MV
How is marriage value and ransoms strips treated in respect of market value under Rule 2?
If Exists by reason of the lands geographical position then additional value would have existed in the no scheme world
Which case found the value of ransoms strips to be 1/3 of development?
Stokes v Cambridge Corporation 1961
What is Rule 3?
” the special suitability or adaptability of the land for any purpose shall not be taken into account if that purpose is a purpose to which it could be applied only in the pursuance of statutory powers, or for which there is no market apart from the requirements of any authority possessing compulsory purchase powers “
Give a case example where Rule 3 applied
Ossalinsky v Manchester Corporation 1883
What are the main points in Ossalinsky v Manchester Corporation 1883?
Concerned land adjacent to Thirlmere reservoir
Land held to have special suitability to a reservoir which could only be carried out by the AA under statutory powers
Therefore Rule 3 applied
What is Rule 4?
” where the value of the land is increased by reason of the use thereof or of any premises thereon in a manner which could be restrained by any court, or is contrary to law or is detrimental to health of the occupants of the premises or to the public health, the amount of that increase shall not be taken into account “
Give 4 examples to which rule 4 applies
1) A farm barn with no planning permission
2) Over crowded houses
3) Property contrary to fire regulations
4) Property contrary to health and safety measures
In light of Rule 4 what actions should be taken?
Take action to make illegal things legal so you can get compensation on it e.g. Go get planning permission. Must have this by date of the valuation but ought to be done by date of NTT
Which case can be used as an example for illegal uses (and rule 4)?
Hughes v Doncaster Metropolitan Borough Council 1991
What was the decision in Hughes v Doncaster Metropolitan Borough Council 1991?
Held that if a use had become immune from enforcement action then that use is relevant for compensation purposes
What is Rule 5?
” where land is and but for the compulsory acquisition would continue to be, devoted to a purpose of such a nature that there is no general demand or market for the land for that purpose, the compensation may, if the LT is satisfied that reinstatement in some other place is a bona fide intention, be assessed on the basis of the reasonable cost of equivalent reinstatement “
What is Rule 5 simply saying?
Property for which you cannot define a market for - there is no market for but you need genuine intention to rebuild it
What is Rule 6?
” the provisions of Rule 2 shall not affect the assessment of compensation for disturbance or any other matter not directly based on the value of land “
What is the Pointe Gourde Principle?
The effect of the scheme must be ignored - a claimant should neither gain nor lose out from a compulsory acquisition
Compensation for the compulsory acquisition of land cannot include an increase in value which is entirely due to the scheme underlying the acquisition
Which case did the Pointe Gourde Principle come from?
Pointe Gourde Quarrying Co. v Sub Intendent of Crown Lands 1947
What are the main points in Pointe Gourde Quarrying Co. v Sub Intendent of Crown Lands 1947
Crown needed to acquire land in Trinidad to construct a naval base and the land included a quarry
Limestone from the quarry would be useful for the construction of the naval base
The quarry had an enhanced value
BUT only as a result of the compulsory purchase scheme
What does section 9 of the LCA 1961 provide?
No account shall be taken of any depreciation in the value of the relevant interest which is attributable to the fact that an indication has been given that the relevant land is, or is likely, to be acquired by the AA possession CP powers
Essentially means ignore the blighting effect of the scheme
What effect does the Pointe Gourde Principle have to planning permission?
This means that you have to shows that planning permission could have been granted but for the scheme and in the no scheme world
By which act were s14-17 of the LCA 1961 amended?
S.232 of Localism Act 2011
What does s.14 of the LCA 1961 say?
Take account of actual permission or prospect of permission in assessing compensation when assessing compensation in accordance with Rule 2
What does s.15 of the LCA 1961 say?
Planning permission to be assumed for the acquiring authorities proposals
What does s.16 of the LCA 1961 say?
Special assumptions in respect of certain land comprised in the development plans
What is provided for by s.17 of the LCA 1961?
Certificate of Alternative Development
What is a Certificate of Alternative Development?
If planning permission would have been given in the no scheme world
- make application which must specify the type of development
- LPA issue a certificate (or not)
- appeal to the Upper Tribunal
To what do the statutory planning assumptions relate?
To the land being acquired
What was the main point in Roberts v South Gloucestershire DC 2003
Permission assumed for a road but NOT assumed for the permission to extract gravel under the road site - all you have PP for is the road scheme
What is the special assumption in s.16(1) of the LCA 1961?
Planning permission for the development of a specific description as defined in the current local plan and relates to the DP in place at the date of service of NTT
What is the special assumption in section 16(2) of the LCA 1961?
Planning permission for development where the land is allocated primarily for a specified use in the current DP - and planning permission could reasonably have been obtained
What is betterment/set off?
” the enhancement in the value of land resulting from the actions or decisions of Central or local government or by a statutory body”
So scheme may increase value but you can’t be any better off than before the scheme so have to account for this
If betterment is more than your claim you only pay extent of your claim - won’t owe them
See s7&8 LCA 1961
What does s7&8 LCA 1961 provide?
That where an owner who has land acquired retains land which increases in value due to the scheme that increase in value shall be deducted or set off against the compensation
If betterment exceeds the compensation the excess cannot be recovered
Nor can betterment be recovered from an owner who has no land taken
The Highways Act 1980 has its own betterment provisions. What does s.261 provide?
Where land is compulsory acquired under that act then in assessing compensation for the land taken regard shall be had to the extent to which the remaining contiguous lands belonging to the same person may be benefitted by the purpose for which the land is authorised to then be acquired
Which case is an example for betterment?
Cooke v S of S for Environment 1973
What are the main points in Cooke v S of S for Environment 1973
Contractors paid £6000 to dump soil on Cooks land
AA held that this increased the value of contiguous land so case for set off
For set off to apply there must be some increase in the value of the contiguous land attributable to the road itself e.g. New or improved access
Soil dumping was held to be purely incidental
What was said by Lord Denning in Myers v Milton Keynes Dev. corp. 1974 ?
That when assessing value the valuer should imagine the scheme is not there - “ he must let his imagination take flight to the clouds. He must conjure up a land of make believe, where there has not been, nor will be, a brave new town, but where there is supposed the older order things continuing… “
What is the purpose of compensation?
Principle of equivalence
Livingstone v Rawyards Coal Company 1880
Essentially says: to put the claimant in a no worse position after the scheme (or wrong he has sustained) as he was before - as far as money can do this