Compensation — Area of land scheduled as a monument of national importance under section 1 of the Ancient Monuments and Archaeological Areas Act 1979 — Refusal of scheduled monument consent — Date for determination of compensation
On June 8 1987
the Secretary of State for Scotland scheduled an area known as Torr Righ Mor,
part of the farm of Drumadoon, Blackwaterfoot, Isle of Arran, Scotland, pursuant
to section 1 of the Ancient Monuments and Archaeological Areas Act 1979. The
scheduled area extended to 250 acres and the total area of the farm was 370
acres. Prior to the scheduling, the owners of the farm had intended to turn
part of the farm over to afforestation. On September 22 1987 the owners applied
for scheduled monument consent in respect of the ploughing of land and planting
of young trees on Torr Righ Mor, which consent was refused by the Secretary of
State on July 19 1989. The owners claimed compensation under section 7 of the
1979 Act of £66,600 based upon the difference between the open market value as
moorland calculated as at the date of scheduling on June 8 1987. Section 7(1)
of the 1979 Act provides that where a person who has an interest in the whole
or any part of a monument incurs expenditure or otherwise ‘sustains any loss or
damage in consequence of the refusal, or the granting subject to conditions’ of
a schedule monument consent the Secretary of State shall pay to that person compensation
in respect of that loss or damage.
Decision: It is clear that Parliament intended that compensation should
be payable only for loss or damage incurred as a result of refusal of scheduled
monument consent, such loss being assessed as at the date of refusal: July 19
1989. It was the misfortune of the present claimant that, as at that date, the
open market value of forestry land had fallen considerably owing to the removal
by the 1988 March budget of the pre-existing tax concessions. The Forestry Commission’s
policy is not to give grants under the Woodland Grant Scheme for the planting
up of ancient monuments in archaeological areas. In the light of the
circumstances as at July 1989 the proposal for afforestation of the subject
land for which scheduled monument consent was refused was not likely to have
been proceeded with if scheduled monument consent had been granted.
Accordingly, there was no difference between the value of the land in its
unrestricted and restricted state at no compensation due in respect of the
refusal of scheduled monument consent.
The following
case is referred to in this report.
Cameron v Nature Conservancy Council [1992] 1 EGLR 227; [1992] 07 EG
128
John M Dale,
solicitor, of Dale & Marshall, Galston, appeared for the claimants; M J
Fitzpatrick (instructed by the Secretary of State for Scotland) appeared for
the respondent authority.
Giving their
opinion, THE TRIBUNAL said: This is a reference of a disputed claim for
compensation which has been referred to the Lands Tribunal for Scotland for
determination in terms of section 47(2) of the Ancient Monuments and
Archaeological Areas Act 1979.
The basic
facts giving rise to the compensation claim, as established in evidence, are
that on June 8 1987 the area known as Torr Righ Mor forming part of the farm of
Drumadoon, Blackwaterfoot, Isle of Arran, was scheduled by the Secretary of
State as a monument of national importance under section 1 of the 1979 Act. The
area so scheduled has maximum dimensions of 1,690m (N-S) by 980m (E-W) and
contains an important complex of hut circles, field systems and clearance
cairns all dating from the Bronze Age. It was owned by the late Rev James
Currie.
Although the
scheduled area extends to 250 acres, the claim is made in respect of a total of
370 acres of the farm. The remaining 120 acres are made up of 80 acres at Shore
Hill, lying west of the scheduled area along the shore of Kilbrandon Sound, and
of 40 acres of Parkhouse Hill, lying to the south-east of the scheduled area.
The importance
of these archaeological remains does not appear to have been appreciated until
relatively recently, as they extend northwards on to Machrie Common, where in
1984 the Forestry Commission obtained permission to plant trees. As these trees
began to grow this inhibited the burning of heather for the benefit of the
sheep on Drumadoon Farm. In 1986 another local farmer burnt Forestry Commission
trees at Kilpatrick Forest owing to the prevailing south-west wind blowing
sparks off his land and over their ground. The sequel, as explained to the
tribunal by Mr Charles Currie (son of the late Rev James Currie), was that,
owing to the commission’s tree planting, his father could no longer burn the
heather on Drumadoon to improve the grazing for the sheep. Hence the family decided
to turn that part of the farm known as The Hill, Drumadoon, over to
afforestation. For this purpose and for advice the late Rev James Currie in
1986 contacted Scottish Woodlands Ltd, Dunblane.
At the hearing
in Edinburgh the claimants were represented by Mr John M Dale, solicitor, who
led in evidence Mr Charles Currie (son of the late Rev James Currie), who farms
Drumadoon, and Mr Norman O’Neill bsc (forestry) employed by Scottish Woodlands
Ltd. The respondent was represented by Mr M J Fitzpatrick, advocate, and
evidence was given on their behalf by Mr Christopher M Rumford frics, district
valuer in the Ayr valuation office.
Mr Norman P
O’Neill gave evidence that he had inspected The Hill and found it entirely
suitable for afforestation. But in view of his past experience at Machrie 2
miles to the north (in which his firm had also been involved) he knew he would
be unable to obtain approval for planting from the Forestry Commission without
the prior agreement of the relevant authorities. He had by then become
aware of the local archaeological remains. He therefore contacted Mr Barclay of
the Historic Buildings and Monuments Section of the Scottish Development
Department to ascertain if at least some tree planting might be permitted. The
latter replied by letter enclosing a map showing those areas which might be
affected. By letter dated January 19 1987 Mr O’Neill replied stating that,
owing to the shape and size of the areas to be excluded from tree planting, the
remaining ground, ie Shore Hill and Parkhouse Hill, was unacceptable for
commercial forestry development.
The Rev James
Currie died shortly thereafter and the formal scheduling of Torr Righ Mor as a
monument of national importance occurred, as already stated, on June 8 1987.
On September
22 1987 an application was made by the present executors for scheduled monument
consent under section 2(4) of the 1979 Act in respect of the ploughing of land
and planting of young trees on Torr Righ Mor. Thereafter, further negotiations
took place with Mr Barclay for a compromise solution, by preserving from
planting and ploughing the most sensitive archaeological sites. But this again
proved unacceptable to the executors on the advice of Mr O’Neill. The
restriction on road building and draining to outwith the protected areas would
make the building of a road system prohibitively expensive. The design of an
adequate drainage system would be more complex and more expensive. Trees near
the edge of the forest, in a coastal location, would be of poorer quality and
the result would be an unacceptably high proportion of such trees.
The dispute
also led to a public local inquiry being ordered by the Secretary of State.
This was held at the Kinloch Hotel, Blackwaterfoot, before Mr D N Gordon,
reporter. The reporter thereafter recommended against even the compromise
solution suggested by Mr Barclay. This was on the grounds that, although the
most interesting parts of the sites would be left largely intact, on the other
hand most of the archaeological remains in the unprotected larger part of the
site would be seriously damaged. Furthermore, the reporter pointed out (1) that
woodland grant assistance was now unlikely to be provided in such a location;
and (2) that it was also far from certain that afforestation of the awkwardly shaped
unprotected area of the site would now be commercially viable even if woodland
grant was available. The reporter concluded that the provisional view taken by
the department would result in significant demonstrable archaeological harm
with no certainty of economic gain to the applicants.
The Secretary
of State accepted all his reporter’s recommendations and, by letter dated July
19 1989, refused scheduled monument consent. As a result, the executors now
claim compensation under section 7 of the 1979 Act in a total sum of £66,600
based upon the difference between the open market value of 370 acres at Torr
Righ Mor as forestry land and its open market value as moorland. This was
calculated as at the date of scheduling on June 8 1987, which was contended by them
to have caused the land effectively to lose its forestry value.
In his closing
submissions for the executors, Mr Dale contended that the land originally
possessed two values as stated in the claim: (a) an existing agricultural use
value of (say) £50 per acre and (b) a value for forestry purposes of £230 per
acre, which, however, was a ‘postponed value’ until scheduled monument consent
was eventually granted. He observed that, as spoken to by Mr O’Neill in
evidence, there had occurred in the intervening period the withdrawal in the
March 1988 Budget of the tax advantages associated with tree planting through
the abolition of Schedule B. The existing Forestry Grant Scheme giving a
subsidy of approximately £95 an acre was substituted by the Woodland Grant
Scheme giving a subsidy of approximately £250 an acre. The net effect of these
two fiscal changes resulted in a reduction in the value of Scottish forestry
land by some 15%. The executors had done their best to promote afforestation in
lieu of agriculture on Torr Righ Mor, since the latter had become impracticable
for grazing owing to the fire danger. In these circumstances, so Mr Dale
contended, what had really prevented tree planting was the original scheduling
as an ancient monument on June 8 1987 followed in due course by the refusal of
scheduled monument consent on July 19 1989. The original scheduling was thus
the real cause, although its ultimate effect had been suspended until 1989. In
the interim had occurred the grant and tax changes. Mr Dale also submitted that
it was ultra vires of the Forestry Commission to operate their woodland
grant scheme so as to protect ancient monuments. Their only concern was to
promote forestry.
When it was
put to Mr Dale that 80 acres at Shore Hill and 40 acres at Parkhouse Hill in
the area proposed to be planted were not included in the scheduling, he
commented that these were areas which were now uneconomic to plant on their
own. They, too, had been effectively sterilised by the scheduling. Hence they
had been properly included in the total area in respect of which compensation
was now claimed.
In replying on
behalf of the Secretary of State Mr Fitzpatrick commenced by emphasising the
long history of the scheduling of ancient monuments in the United Kingdom. He
referred to the Ancient Monuments Protection Act 1882, which for the first time
provided for a schedule of monuments and for Commissioners of Works with powers
of purchase. The Ancient Monuments Board was set up under the Ancient Monuments
Consolidation and Amendment Act 1913, section 12 of which provided for
monuments to be contained in a published list. There followed the Ancient
Monuments Act 1931, which provided that the commissioners were to prepare
schemes to preserve such monuments while works of alteration thereto without
permission were prohibited. The Second Schedule also provided for compensation
and the making of claims. It further enacted that no person should be entitled
to compensation by reason of the fact that any act or thing done or caused to be
done by him had been rendered abortive by a preservation scheme. The Historic
Buildings and Ancient Monuments Act 1953 merely amended the procedure for
preservation notices. The Ancient Monuments and Archaeological Areas Act 1979
under which the present claim is made, he emphasised, was both a consolidation
and an amending statute. It provided under section 1 that the Secretary of
State should compile and maintain a schedule of monuments which, on first
compiling, was to include all monuments already listed under the preceding
Acts. It also provided under section 1(3) that the Secretary of State on first
compiling or at any time thereafter was to include any monument which appeared
to him to be of national importance.
Counsel stated
that to his knowledge there had been no previous case in Scotland dealing with
disputed questions of compensation under section 7 of the 1979 Act. He
emphasised that the tribunal’s jurisdiction related only to the assessment of
compensation and was not concerned with the powers of the Forestry Commission.
Counsel
submitted that, in terms of section 7(1) it was also clear that compensation
was due only on the refusal of scheduled monument consent. He commented that
the claimants were now trying to relate their claim to the original scheduling
albeit postponed to the ultimate refusal of scheduled monument consent; that
is, their claim was based on what would have been the value of their property
if scheduling had not taken place. This was not, however, what the statute
actually stated. Nor, as a practical matter, could a compensation claim anyway
be related to the original scheduling, for such might have occurred many years
ago under the various preceding statutes. Furthermore, the value of the land in
question on which the present claim was based had already been devalued as at
the date of refusal of consent by the non-availability of woodland grant. There
was also no evidence before the tribunal that, if scheduled monument consent
had then been granted by the Secretary of State instead of being refused,
woodland grant would indeed have been available. The woodland grant scheme was
administered by the Forestry Commission, which was an independent United
Kingdom agency. It was entirely within their discretion whether to make woodland
grant available. Hence the withholding of grant need have nothing to do with
scheduling nor
prepared to accept that no woodland grant would have been available owing to
the presence of the scheduled monuments in question. In his submission,
however, this did not affect the question of compensation for refusal of
scheduled monument consent.
Decision
As counsel for
the Secretary of State has pointed out, this tribunal’s jurisdiction under
section 47(2) of the 1979 Act is confined to deciding whether compensation is
due and, if so, the amount thereof. The question of whether the Forestry
Commission have acted ultra vires in relation to woodland grants is not
within our jurisdiction.
Section 7(1)
provides as follows:
Subject to
the following provisions of this section, where a person who has an interest in
the whole or any part of a monument incurs expenditure or otherwise sustains
any loss or damage in consequence of the refusal, or the granting subject to
conditions, of a scheduled monument consent in relation to any works of a
description mentioned in subsection (2) below, the Secretary of State shall pay
to that person compensation in respect of that expenditure, loss or damage.
(Our emphasis.)
Section 47(2)
provides:
Any question
of disputed compensation under this Act shall be referred to and determined by
the Lands Tribunal or (in the case of land situated in Scotland) by the Lands
Tribunal for Scotland.
Subsection (3)
then provides:
In relation
to the determination of any such question . . . the provisions of sections 9
and 11 of the Land Compensation (Scotland) Act 1963 shall apply.
These
subsections, however, deal only with procedure and expenses. The rules for
actually assessing the compensation payable and contained in section 12 of the
1963 Act are noticeably not incorporated.
The Wildlife
and Countryside Act 1981 provides for payments due following a management
agreement, in turn following from the designation by the Secretary of State of
a site of special scientific interest (SSSI): see Cameron v Nature
Conservancy Council [1992] 1 EGLR 227; [1992] 07 EG 128; 08 EG 120 and 09
EG 147. Section 50(2) of the 1981 Act provides that such a payment has to be in
accordance with ministerial guidelines now appearing in The Financial
Guidelines for Management Agreements, para 14 of which provides that a
lump-sum payment in compensation shall be
equal to the
difference between the restricted and unrestricted value of the owner or
owner-occupier’s interest calculated having regard to the rules for assessment
in respect of the compulsory acquisition of an interest in land, as set out in
section 12 of the Land Compensation (Scotland) Act 1963 so far as applicable
and subject to any necessary modifications.
It is
significant that under the 1981 Act there is no provision for compensation at
the date of designation of an SSSI. There is also a statutory valuation date,
being the effective date of the management agreement and only a four-week
period is allowed for its negotiation.
In the Cameron
case both the claimant and the respondent were agreed that the open market
value of the whole of Glenlochay Estate (one-third only of which was designated
under two extensive SSSIs but to which the whole land use scheme related)
should be valued on a restricted and unrestricted basis as at the valuation
date. The difference was the payment then due to the claimant by the Nature
Conservancy Council. The estate was valued by both parties primarily as a hill
sheep farm capable of improvement, but on the basis that it could not be so
well improved standing the extent of the SSSIs.
In the present
case we are dealing with the 1979 Act enacted two years previously to the Act
of 1981, but dealing with archaeological areas and ancient monuments. The
tribunal have now to give effect to the clear wording of section 7 of that Act
which, as confirmed by the sidenote thereto, deals with ‘compensation for
refusal of scheduled monument consent’. Compensation is also payable for the granting
of scheduled monument consent subject to conditions which, however, is confined
to compensation in respect of ‘any expenditure incurred or other loss or damage
sustained in consequence of the refusal, or the granting subject to
conditions, of a scheduled monument consent in relation to [those] works‘.
(Our emphasis.)
The basis for
such compensation will be the difference in value which may exist between the
land in its existing use and the land in a more profitable use. But the first
question to answer is the date at which their values fall to be assessed.
This Bronze
Age monument on the south-west coast of the Isle of Arran might have been
scheduled, if then known to exist, under the Ancient Monuments Protection Act
1882 or the Ancient Monuments Act 1931 and then have been included in due
course in the Schedule to the 1979 Act. Clearly, compensation could not then be
related or become payable on the original scheduling when no immediate change
of use was contemplated.
In the present
case, Mr Dale admits that compensation can be payable only as from the date of
refusal but related, so he contends, to the pre-existing conditions as at the
date of scheduling which was the original cause of the ban on afforestation. In
the tribunal’s opinion, however, this cannot be so, for in this case the
claimants might have obtained some relaxation from the Scottish Development
Department on the ban on tree planting within the scheduled area. Indeed, the
department appear to have been much more flexible than the Nature Conservancy
Council are apparently allowed to be under the 1981 Act. The department even
caused a public local inquiry to be held in this case which, however, in the
event recommended against any relaxation whatsoever. But this only goes to
confirm that compensation cannot, as a practical matter, be intended to relate
to the date of original scheduling.
This is also
confirmed by the compensation provisions contained in section 7(1) and (2)
relating to expenditure incurred, or other loss or damage sustained, in
consequence of the refusal of scheduled monument consent. For such compensation
under section 7(2)(a) is only in respect of works which are reasonably
necessary for carrying out any development for which planning permission had
been granted before the time when the monument in question became a scheduled
monument and was still effective at the date of the application for scheduled
monument consent.
It is
therefore clear that Parliament intended that compensation should be payable
for loss or damage incurred only as a result of the refusal of scheduled
monument consent, such loss being assessed as at the date of refusal — in this
case July 19 1989. The claimant has to show that depreciation in value of his
interest in land has occurred as a consequence of the refusal of scheduled
monument consent at that date. It is the misfortune of the present claimants
that, as at that date, the open market value of forestry land had fallen
considerably owing to the removal in the 1988 March Budget of the pre-existing
tax concessions. There was also the factor, detrimental to the claimants’
claim, that the Forestry Commission, which are a United Kingdom Government
Agency, do not in practice give grants under their woodland grant (formerly
forestry grant) scheme for the planting up of ancient monuments in
archaeological areas. The woodland grant scheme was introduced in April 1988 as
successor to the similar forestry grant scheme and carries on an identical
policy.
The evidence
in this case suggests that the policy is increasingly applied in favour of the
protection of archaeological remains and ancient monuments. It is the Forestry
Commission’s policy that planting should not damage any sites which are of
archaeological importance. To this end the commission send a copy of every
application containing proposals for new planting to the appropriate
archaeological authority (usually the regional archaeologist) asking to be
informed of any features of archaeological importance on the area in question
which should be taken into account. In this case the Strathclyde Structure Plan
identifies South-West Arran, within which Torr Righ Mor lies, as being of
outstanding archaeological importance.
This case
involves alleged loss and damage through the refusal of scheduled monument consent
for the ploughing and planting up with trees of a major archaeological area. In
the light of the circumstances as at July 1989 the tribunal have to ask
themselves: would this proposal for afforestation at Torr Righ Mor for which
scheduled monument consent was then refused have been likely to have been
proceeded with if scheduled monument consent had been granted? In our opinion and in the light of the
evidence, the answer must be ‘no’. According to the claimants’ own expert
witness, forestry would have been unviable at an earlier date even on the
suggested compromise areas. Forestry grant would probably not have been
available for these areas and there is no evidence that, once the tax
concessions were withdrawn in March 1988, afforestation was still a viable
proposition without the benefit of grants. There is therefore no difference
between the value of the land in its unrestricted and restricted state.
The tribunal
therefore find that, in terms of section 7(1), no compensation is due in
respect of the refusal of scheduled monument consent.
Mr Fitzpatrick
submitted that expenses should follow success and that they should be based on
the Court of Session scale owing to the importance and novelty of the case.
This motion was not opposed. He also moved for the certification of counsel.
There were no other motions for certification.
The tribunal
find the Secretary of State entitled to his expenses to be taxed failing
agreement by the auditor of the Court of Session on the Court of Session scale.
The employment of counsel is also certified.
