Compulsory purchase – Compensation – Limitation – Claimant’s premises acquired by general vesting declarations pursuant to compulsory purchase order – Time passing while claimant pursuing appeals regarding terms of certificate of appropriate alternative development – Reference for determination of compensation in respect of acquired interests made more than six years after two of those interests vesting in acquiring authority – Section 10(3) of Compulsory Purchase (Vesting Declarations) Act 1981 – Whether reference time-barred – Whether time running from vesting date of last of interests acquired – Preliminary issue determined in favour of acquiring authority
The claimant owned premises in Stratford, London E15, which the acquiring authority’s predecessor acquired pursuant to a 2005 compulsory purchase order (CPO) for the purposes of the development of the Olympic Park. The schedule of interests referred to in the CPO identified three plots in which the claimant was thought to have an interest. The first two plots comprised the freehold of a building, of which the lower floor was used as a meat processing unit and the upper floor as a nightclub, plus a long lease of an adjoining yard. The third comprised a stretch of the public road and footways, together with a bridge carrying the road over the adjoining railway line; the claimant was identified as one of eight owners or reputed owners of that plot. The building and yard vested in the acquiring authority’s predecessor in July 2007. Additional land, including the road and footways, vested in September 2008.
The claimant sought a certificate of appropriate alternative development from the local planning authority in respect of the building and yard for the purposes of its compensation claim. A certificate was granted but not in the requested terms. The claimant pursued appeals first to a planning inspector and then to the High Court. Those proceedings ended in June 2012, when the acquiring authority gave an undertaking designed to ensure that compensation was assessed on the basis of a planning permission for uses in Classes A1, A3 or as a crèche.
In July 2013, the claimant submitted a notice of reference seeking a determination of the compensation payable to it under section 1 of the Lands Compensation Act 1961. The acquiring authority applied to have the reference struck out in relation to the building and yard on the ground that it had been made more than six years after the land had vested and was therefore time-barred under section 10 of the Compulsory Purchase (Vesting Declarations) Act 1981. The limitation point was tried as a preliminary issue. The claimant contended that the reference was not time-barred since time ran from the date when the last of its interests had vested, namely the 2008 vesting date of the road and footways.
Held: The preliminary issue was determined in favour of the acquiring authority.
The reference had been made after the expiry of the relevant limitation period. The only significant date for the purpose of setting time running was the date on which the person claiming compensation first knew or could reasonably be expected to have known of the vesting of the interest in respect of which compensation was sought. The period of six years in which a claim was required to be brought had therefore to be calculated from July 2007, as the date when the freehold and leasehold interests in the building and yard had vested in the acquiring authority’s predecessor. There was no justification in the 1981 Act for treating the claim for compensation as having accrued on the vesting date of the last of the claimant’s interests to be the subject of a general vesting declaration. When different interests vested at different times, a separate cause of action existed in relation to each of them from the date of vesting relevant to that interest.
The Upper Tribunal had no power to extend the statutory limitation period. The claimant did not suggest that anything done by the acquiring authority or its predecessor amounted to a waiver of the six-year limitation period, or that any estoppel applied to prevent the respondent from relying on the expiry of that period. In those circumstances, it was immaterial whether the claimant had pursued its application for a certificate of appropriate alternative development with diligence, or that it would not be properly compensated to the full extent of its loss if the reference was not admitted after the expiry of the limitation period.
The problem in the instant case had arisen because the claimant had originally been under the misconception that it was entitled to refer the claim for compensation to the tribunal for up to six years after the date on which the acquiring authority took possession of the property. That was not the law in a case where possession had been taken by virtue of a general vesting declaration. By contrast with cases where a notice to treat had been served, in the case of a general vesting declaration time ran from the date stipulated in section 10(3) of the 1981 Act, namely the date on which the person claiming compensation, or a person under whom he derived title, first knew, or could reasonably be expected to have known, of the vesting of the interest. The date on which the acquiring authority took physical possession of the land was irrelevant for that purpose.
The preliminary issue was determined on the written representations of the parties.
Sally Dobson, barrister