Land – Depreciation in value – Compensation – Highway – Respondents failing to adopt new highway within three-year time limit – Whether appellants eligible for compensation – Whether highway maintainable at public expense – Whether highway constructed on behalf of highway authority – Appeal allowed
The appellants were owned and occupied a dwellinghouse. They claimed that the value of their interest in that property had been depreciated by the noise caused by the use of the Calne northern distributor road (NDR). The respondents were the local highway authority for the NDR. In November 1997, pursuant to section 106 of the Town and Country Planning Act 1990, a consortium of developers had entered into an agreement with the respondents to construct the NDR in connection with a substantial development scheme. The affected landowners were also parties to the agreement. The agreement provided for the adoption of the NDR as a highway maintainable at public expense. In 1999, the developers, but not the landowners, made a further agreement with the respondents for the accelerated construction of the NDR (the acceleration agreement).
The NDR was opened to traffic on 20 January 2000 and, on 21 January 2001, the appellants claimed compensation under Part I of the Land Compensation Act 1973. The respondents rejected those claims on the basis that the NDR had not been a highway maintainable at public expense under section 36(2)(a) of the Highways Act 1980 at the date upon which it was opened to traffic and had not become so maintainable.
The Lands Tribunal accepted the respondents’ contention that section 19(3) of the 1973 Act applied, so that no claim for compensation under Part I could be made since the highway had been first opened to public traffic when it was not maintainable at public expense and did not become so within three years of that date. The tribunal decided, as a preliminary issue, that section 19(3) barred any claim to compensation that the claimants might otherwise have had. The tribunal rejected the appellants’ submission that section 19(3) could be “read down” under section 3(1) of the Human Rights Act 1998 to avoid potential incompatibility with their rights under the European Convention on Human Rights: see [2006] 2 EGLR 81; [2006] 18 EG 152. The appellants appealed.
Held: The appeal was allowed.
The NDR fell within section 36(2)(a) of the 1980 Act so that section 19(3) of the 1973 Act did not bar the appellants’ claim to compensation. Accordingly, in this case, the proper application of section 19(3) did not give rise to any potential incompatibility with the appellants’ human rights.
The tribunal had been wrong to think that some dichotomy arose between section 24(2) of the 1980 Act, which conferred on a local highway authority the power to construct a new highway, and section 278 of that Act, which concerned the funding of the works that the authority were or might be authorised to execute. Section 278(1)(a) enabled the authority to enter into an agreement with another party, under which the authority agreed to construct a highway under section 24(2) on the condition that the other party to the agreement would pay the entirety or part of the cost of those works. In the present case, section 278(1)(a) enabled the respondents to enter into the acceleration agreement, but section 24(2) authorised them to perform the obligation to construct the NDR that it had assumed under that agreement.
The proper approach was to ask whether the circumstances in which the highway was constructed by the highway authority should lead to the conclusion that it was constructed on behalf of a party that was not a highway authority. In the instant case, the answer to that question was “no”. The purpose of the acceleration agreement was that the NDR should not be constructed by the consortium and an agreement under which an act was to be done by A as agent for B was not to be treated as having the effect that B was doing the act on behalf of A.
Robert Jay QC and Robert Weir (instructed by Hugh James Solicitors, of Merthyr Tydfil) appeared for the appellants; Timothy Straker QC and Paul Stinchcombe (instructed by the legal department of Wiltshire County Council) appeared for the respondents.
Eileen O’Grady, barrister