Town and Country Planning Act 1971 — Tree preservation order — Compensation claimed by landowner for refusal of permission to fell trees on part of woodland subject to a tree preservation order, the owner’s intention being to grub out and clear scrub and coppice with a view to conversion into grazing land — Dispute as to correct basis of compensation — Appeal by local authority from decision of Lands Tribunal (Mr C R Mallett FRICS) — It had been agreed that if the approach of the tribunal were correct the compensation (being a variation of the tribunal’s award) should be £38,851.27 — If, however, the appellant authority succeeded in their claim that compensation was limited to the commercial value of the timber which the landowner could not realise, the actual amount would be nil after appropriate deductions for acquisition and sale
The following cases are referred to in this report.
Amalgamated Investment & Property Co Ltd v John Walker & Sons Ltd [1977] 1 WLR 164; [1976] 3 All ER 509; (1976) 32 P&CR 278; [1976] EGD 166; 239 EG 277, CA
Associated Provincial Picture Houses Ltd v Wednesbury Corporation [1948] 1 KB 223; [1947] 2 All ER 680, (1947) 45 LGR 635, CA
Hoveringham Gravels Ltd v Secretary of State for the Environment [1975] QB 754; [1975] 2 WLR 897; [1975] 2 All ER 931; (1975) 73 LGR 238; 30 P&CR 151; [1975] EGD 496; 235 EG 217 & 295, CA
This was an appeal by the compensating authority, Canterbury City Council, by way of case stated, from a decision of the Lands Tribunal awarding compensation to the claimant, Peter Joseph Bell, the present respondent, on the basis of the diminution in the value of his land following a refusal of permission to fell trees on a woodland subject to a tree preservation order. The woodland was part of the respondent’s farm, Great Palmstead Farm, Upper Hardres, Kent. The decision of the Lands Tribunal was reported at [1986] 2 EGLR 289; (1986) 279 EG 767.
Robert Carnwath QC and Edward Cohen (instructed by Mr M G P Young, solicitors’ department, Canterbury City Council) appeared on behalf of the appellants; Jonathan Milner (instructed by Kingsford Flower & Pain, of Ashford, Kent) represented the respondent.
Giving the first judgment at the invitation of SLADE LJ, RUSSELL LJ said: This case is concerned with the level of compensation to be awarded to a landowner who is refused permission by a local authority to fell trees on his land, when such land is subject to a tree preservation order. The appellants, the Canterbury City Council, contend that compensation is basically limited to the commercial value of the timber which the landowner cannot realise because of the refusal of permission. The respondent, a farmer, contends that if the value of the land itself is diminished as a result of the refusal of permission, such diminution in value of his interest in the land is a proper head of claim. The matter comes before this court on appeal by way of case stated from the Lands Tribunal, the member of the tribunal, C R Mallett Esq FRICS, having found in favour of the respondent’s submissions as to the basis of compensation and having rejected the narrower approach of the local authority. Other supplementary matters were originally in dispute between the parties, but it is now agreed that if the basic approach of the Lands Tribunal was appropriate, the award of compensation should be £38,851.27. If the appeal succeeds, then the value of the timber involved is such that, after making the appropriate deductions for its acquisition and sale, no compensation is due to the claimant.
The facts fall within a comparatively small compass and are, for the most part, contained in the written decision of the tribunal. Mr P J Bell, the claimant, purchased Great Palmstead Farm, Upper Hardres, in 1970. It comprised a stock and arable farm of some 114 acres including a dilapidated farmhouse and derelict farm buildings. Mr Bell sought to improve the holding and grant approval was sought and obtained from the Ministry of Agriculture, Fisheries and Food to a six-year development plan dated July 31 1980, under the Agriculture and Horticulture Development Scheme.
In 1981 Mr Bell purchased some 88 acres of adjoining woodland. After consulting with his professional advisers, he applied to the Ministry for a variation in the development plan involving clearing scrub and coppice from 50 acres of the woodland and converting it to grazing land. He purchased a bulldozer and proceeded to clear two acres of woodland, whereupon the Canterbury City Council served on him the Canterbury City Council (Quilters Wood, Middle Wood, Featherley Wood, part of Mill Bank Wood and part of Atchester Wood, Kingston/Upper Hardres) Tree Preservation Order No 3 1982. Service of the order was effected on May 27 1982 before it was confirmed by the city council, but there is a provision in the Town and Country Planning Act 1971 (as amended) for this to be done in cases of urgency. The order was in the form prescribed by the Town and Country Planning (Tree Preservation Order) Regulations 1969 and, in general terms, it provided that, except with the consent of the authority and in accordance with conditions (if any) imposed on such consent, no person could cut down any tree specified in the first schedule to the order, or comprised in a woodland therein specified. The first schedule included what ultimately became the area involved|page:206| in this appeal, namely Quilters Wood and Featherley Wood. Together they amounted to 39.1 acres of woodland.
In 1982 the claimant was successfully prosecuted for grubbing out 2.9 acres of the land covered by the order without permission.
On March 30 1983 Mr Bell submitted an application to the authority to grub out the 39.1 acres and, in accordance with the requirement of article 3 of the order, he indicated in writing to the authority his reasons for making the application, namely, to provide grazing for ‘a beef/sheep enterprise’. In the application form itself, the proposed operation was described as ‘to grub out the trees so that the land may be used for agriculture’.
On June 15 1983 permission was refused by the local authority on amenity grounds and also because the proposed works were said to be contrary to the Kent Structure Plan. The claimant appealed, but after a local public inquiry in February 1984 the Secretary of State dismissed the appeal.
On May 29 1985 the claimant referred his claim for compensation to the Lands Tribunal. Before the hearing, on November 27 1985, the Canterbury City Council passed a resolution in the following terms:
That, as a matter of urgency because of the time limit involved, it be confirmed that had the Council granted consent to fell or grub out trees on part of the woodland the subject of the above Tree Preservation Order, a direction would have been made to replant the land in accordance with article 6 of the Tree Preservation Order.
It will be necessary to return to this resolution later in this judgment. The decision of the Lands Tribunal is dated June 5 1986, after a hearing which occupied some four days. The fundamental basis of Mr Mallett’s award was that the current capital value of the land in its present state was £450 per acre, whereas its value, if reclamation for grazing land had been permitted, would have been £1,900 per acre.
I turn to the statutory provisions affecting the appeal. Section 60 of the Town and Country Planning Act 1971 provides, so far as it is material:
(1) If it appears to a local planning authority that it is expedient in the interests of amenity to make provision for the preservation of trees or woodlands in their area, they may for that purpose make an order (in this Act referred to as a ‘tree preservation order’) with respect to such trees, groups of trees or woodlands as may be specified in the order; and, in particular, provision may be made by any such order —
(a) for prohibiting (subject to any exemptions for which provision may be made by the order) the cutting down, topping, lopping or wilful destruction of trees except with the consent of the local planning authority, and for enabling that authority to give their consent subject to conditions;
(b) for securing the replanting, in such manner as may be prescribed by or under the order, of any part of a woodland area which is felled in the course of forestry operations permitted by or under the order; . . . .
The tree preservation order with which this case is concerned contained the following material articles to which hitherto I have made no reference. Article 4 is in these terms:
(1) Where an application for consent is made to the authority under this order, the authority may grant such consent either unconditionally, or subject to such conditions (including conditions requiring the replacement of any tree by one or more trees on the site or in the immediate vicinity thereof), as the authority may think fit, or may refuse consent.
Provided that where the application relates to any woodland specified in the First Schedule to this Order the authority shall grant consent so far as accords with the principles of good forestry, except where, in the opinion of the authority, it is necessary in the interests of amenity to maintain the special character of the woodland or the woodland character of the area, and shall not impose conditions on such consent requiring replacement or replanting.
This article, therefore, expressly precluded the appellants from granting any consent conditional upon the replacement or replanting of trees in the woodlands with which this case is concerned. So much was acknowledged by counsel for the local authority.
Reliance, however, was placed upon article 6, which reads as follows:
(1) Where consent is granted under this order to fell any part of a woodland other than consent for silvicultural thinning then unless —
(a) such consent is granted for the purpose of enabling development to be carried out in accordance with a permission to develop land under Part III of the Act, or
(b) the authority with the approval of the Secretary of State dispense with replanting,
the authority shall give to the owner of the land on which that part of the woodland is situated a direction in writing specifying the manner in which and the time within which he shall replant such land and where such a direction is given and the part is felled the owner shall, subject to the provision of this order and section 175 of the Act, replant the said land in accordance with the direction.
There follows an immaterial subparagraph dealing with the requirements of such a direction.
As to (a), it was not submitted to the Lands Tribunal that the operation contemplated by Mr Bell did amount to development under Part III of the Act (see section 22(2)). As to (b), there had, of course, been no dispensation approved by the Secretary of State.
In my judgment article 6 plainly derives its authority from section 60(1)(b) of the Act, and by virtue of its provisions is confined to cases where any part of a woodland area ‘is felled in the course of forestry operations’. I strongly suspect that in the instant case the local authority felt that they were obliged, by virtue of article 6, to give the direction to replant in the event of giving consent. If that was the motivation behind the passing of the resolution of November 27 1985 it was misconceived; if it was not, it is difficult to understand how any local authority could reasonably give consent to the felling of trees for the purposes of reclaiming the land for grazing while, at the same time, requiring replanting of those trees, thereby defeating the whole purpose of the operation and the object of the consent. In my view the position would be quite different in what I understand is meant by the phrase ‘forestry operations’. No statutory definition of the phrase is to be found in the statute or regulations made under it, but I am firmly of the opinion that what was contemplated by the claimant did not involve forestry operations and that consequently article 6 did not require the local authority to serve a direction. That the article was intended to relate exclusively to forestry operations is, in my judgment, clear not only from the provisions of section 60 itself but from the wording of article 6. ‘Silvicultural thinning’ referred to in article 6 is an activity confined to what one would normally regard as forestry operations.
The local authority plainly took the view that by passing the resolution to which I have referred they were effectively preventing the claimant from mounting any claim based upon differences in land values, because no diminution in land value could arise if, when giving consent, there was a contemporaneous direction to replant. I repeat that, in my opinion, the proposals of the claimant did not constitute forestry operations which, I venture to suggest, involve the commercial exploitation of timber.
That is enough to dispose of the submission made on behalf of the appellants that the effect of the resolution was to defeat Mr Bell’s claim for compensation but, even if the giving of a direction to replant had been open to the appellants, its exercise to take effect contemporaneously with the consent would, in my judgment, have been Wednesbury unreasonable — as the Lands Tribunal concluded.
Before leaving this part of the case, it is worth observing that compensation is not payable in every case where the local authority refuses consent. Article 5 provides:
Where the authority refuse consent under this order or grant such consent subject to conditions they may when refusing or granting consent certify in respect of any trees for which they are so refusing or granting consent that they are satisfied —
(a) that the refusal or condition is in the interests of good forestry; or
(b) in the case of trees other than trees comprised in woodlands, that the trees have an outstanding or special amenity value.
The proviso to article 9 reads:
. . . no compensation shall be payable in respect of loss or damage suffered by reason of such refusal or grant of consent in the case of any trees the subject of a certificate in accordance with Article 5 of this order.
I move on to consider other submissions of counsel. Section 174 of the 1971 Act provides:
The matters for which provision may under section 60 of this Act be made by a tree preservation order include the payment of the local planning authority, subject to such exceptions and conditions as may be specified in the order, of compensation in respect of loss or damage caused or incurred in consequence of the refusal of any consent required under the order, or of the grant of any such consent subject to conditions.
This, then, is the enabling provision. It is not the statute itself which sets out the terms upon which compensation is to be payable but the tree preservation order.
Article 9, the proviso to which I have referred, reads:
Subject to the provisions of this order, any person who has suffered loss or damage in consequence of any refusal (including revocation or modification) of consent under this order or of any grant of any such consent subject to conditions, shall, if he makes a claim on the authority within the time and in the manner prescribed by this order, be entitled to recover from the authority compensation in respect of such loss or damage:
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As to the measure of compensation, the operative words are ‘loss or damage in consequence of any refusal of consent’.
Counsel for the appellants drew our attention to various provisions in the 1971 Act dealing with the measure of compensation consequent upon other refusals of consent by local authorities exercising planning functions. It is true that in some cases there is express reference to the depreciation of value of an interest in land as a basis for compensation. The absence of any such provision in section 174, submits counsel, is significant. I disagree. Section 174 does not seek to define the measure of compensation; that is the function of article 9, the interpretation of which should, in my judgment, be read without reference to other provisions in the Act of Parliament.
Counsel for the respondent submits that the words of article 9 should be given their ordinary meaning and that the proved diminution in the value of the claimant’s interest in his land amounts to ‘loss or damage in consequence of a refusal of consent’. Nothing is to be found in the order which could justify limiting compensation in the way suggested by the local authority. Nor was any such limitation to be found in the enabling statute. I agree with these submissions and, for my part, I would reject the argument advanced on behalf of the local authority by their counsel to the effect that the loss suffered by the claimant as a result of his inability to reclaim his land for agricultural grazing was a consequence of the order itself, as opposed to the refusal which, it was contended, simply prevented the cutting down of trees.
In my view the diminution in the value of the land was a natural and probable consequence of the refusal of consent, within the contemplation of the local authority refusing consent. It was not too remote and was, therefore, recoverable. Its proper assessment is to be derived from the words of article 9, not section 174 — hence the exclusion of section 174 from the provisions of section 178, to which our attention was directed.
Counsel for the respondent did seek to argue that the grubbing-out operation was an engineering operation within Class VI of the Town and Country Planning General Development Order 1977 and that consequently it did amount to development under Part III of the Act so as to exclude the operation of article 6 in any event. For my part I have my reservations about this submission, not least because we have insufficient evidence to rule definitively upon it. The point was not taken before the Lands Tribunal, and in the light of the views I have earlier expressed as to article 6 and its applicability, it is unnecessary to prolong this judgment by any further discussion of the true nature of the claimant’s operations in a planning context.
I hope that in this judgment I have answered the relevant questions posed at the end of the case. Because the parties have come to terms on matters of detail, some of the questions are no longer appropriate. I would dismiss the appeal.
Agreeing, TAYLOR LJ said: I would add only two further reasons in support of what Russell LJ has said.
The first concerns the scope of article 6 of the order. I agree that it is included in pursuance of section 60(1)(b) of the Act and is therefore concerned only with forestry operations. That view is supported by the text of the article itself. After referring to the direction to replant, it continues:
. . . and where such a direction is given and the part is felled the owner shall, subject to the provision of this order and section 175 of the Act, replant the said land in accordance with the direction.
Section 175 of the Act provides for compensation where a direction to replant has been given. Subsection (1) reads:
The provisions of this section shall have effect where, in pursuance of provision made by a tree preservation order, a direction is given, by the local planning authority or the Secretary of State, for securing the replanting of all or any part of a woodland area which is felled in the course of forestry operations permitted by or under the order.
Thus, article 6, by invoking section 175, clearly proclaims itself to be related to forestry operations.
My second point concerns Mr Carnwath’s submission that it was the making of the tree preservation order itself and not the refusal of consent which precluded Mr Bell from converting his land for grazing. Thus the claim for compensation fails, it is said, on grounds of causation.
If this argument be right, then it would apply equally to compensation for the commercial value of the timber. The inability of Mr Bell to cut down his trees must result from the same causative factor whether his complaint is that he cannot sell his timber or that he cannot graze his livestock. Yet Mr Carnwath concedes that Mr Bell is entitled to compensation for loss of the sale value of his timber.
In my judgment, that involves a distinction which cannot logically be justified. I consider both heads of loss resulted from the refusal of consent, so that the causation argument fails.
Also agreeing, SLADE LJ said: I will add some observations of my own only out of deference to Mr Carnwath’s argument.
The member of the Lands Tribunal in his decision described the issue before him as being ‘determination of compensation payable under section 174 of the Town and Country Planning Act 1971’. Strictly, section 174 does not itself afford any entitlement to compensation. All it does is to authorise the inclusion of provisions for compensation of a specified nature in a tree preservation order made under section 60 of that Act.
Article 9 of the Tree Preservation Order No 3, 1982 states:
Subject to the provisions of this order, any person who has suffered loss or damage in consequence of any refusal (including revocation or modification) of consent under this order or of any grant of any such consent subject to conditions, shall, if he makes a claim on the authority within the time and in the manner prescribed by this order, be entitled to recover from the authority compensation in respect of such loss or damage:
Article 9 ends with a proviso which does not affect the claimant’s rights to compensation in the present case.
On June 15 1983 the appellant council refused its consent under the order to Mr Bell’s application to grub out about 39.1 acres of woodland so that the land might be used for agriculture. The Lands Tribunal found that the value of the land in its current state is £450 per acre, but the value of the land as reinstated pasture land would be £1,900 per acre.
Prima facie, therefore, the loss or damage suffered by the claimant in consequence of the refusal of consent under the order was the difference between the value of the land in its present state and its value as reinstated pasture land and was recoverable by him under article 9 accordingly. This was in substance the basis upon which the member made his award.
If I correctly followed Mr Carnwath’s argument, there were three principal reasons why he submitted that the member erred in law in reaching this conclusion, though I do not summarise these reasons either in the same order or in the same terminology as he employed.
First, he referred us to a number of sections in the 1971 Act (for example, sections 164, 169, 170 and 171) which explicitly provide for a person to receive compensation for a depreciation in the value of his interest in land in the contingencies there specified. He also referred to section 178 which, with certain stated exceptions of which section 174 is one, renders the provisions of section 5 of the Land Compensation Act 1961 applicable for the purpose of assessing any compensation which, under the preceding provisions of Part VIII of the 1971 Act, is payable in respect of depreciation of the value of an interest in land. He submitted that these sections of the 1971 Act show that where the value of an interest in the relevant land falls to be considered as a potential element in compensation, the 1971 Act specifically refers to this element.
I do not think the submission advances the council’s case. Section 178(2) provides:
This section applies to any compensation which, under the preceding provisions of this Part of this Act other than section 174, 175 or 177 is payable in respect of depreciation of the value of an interest in land.
Section 174(2) thus shows that the legislature contemplated that a tree preservation order made under the authority conferred by sections 60 and 174 might contain provisions rendering compensation payable in respect of depreciation of the value of an interest in land. It is not suggested that article 9 of the tree preservation order in the present case was ultra vires. The only question, therefore, is whether, on its true construction, article 9 does render compensation payable in respect of such depreciation. The language of the article is very broad and, subject to what is said below, I can see no sufficient grounds for restricting its meaning so as to exclude compensation in respect of this particular category of loss.
Second, Mr Carnwath correctly pointed out that no compensation is available for the imposition of the tree preservation order itself. He submitted that the claimant in the present case had purchased the land in question subject to the inherent risk that such an order might be made, just as the plaintiffs in Amalgamated Investment & Property Co Ltd v John Walker & Sons Ltd [1977] 1 WLR 164 had bought their land subject to the inherent risk that the building could|page:208| be listed as of architectural or historic interest. In his submission, it was the making of the tree preservation order itself, not the refusal of the consent to felling, which precluded the claimant from converting his land to agriculture. In these circumstances, it was submitted, the refusal of consent caused no depreciation of the claimant’s interest in the land. By way of analogy, some reliance was placed on the decision of this Court in Hoveringham Gravels Ltd v Secretary of State for the Environment [1975] QB 754.
In my judgment, the short answer to this point is that the tree preservation order carried with it (under article 9) the right for the claimant to receive the compensation properly due to him under the article, if and when an application was thereafter made under the order to fell trees and that application was refused. Only when his subsequent application was refused on June 15 1983 did his loss occur — and his corresponding right to compensation arise.
It is now common ground that the amount of the compensation (if any) falls to be assessed as at the date of the refusal of consent, namely, June 15 1983.
Third, and as his principal point, Mr Carnwath submitted that even if his other submissions were ill-founded, the claimant, as at June 15 1983, had suffered no loss and accordingly would be entitled to no compensation because the council, if it had given consent, would have been entitled and bound to give him a direction for replanting of the relevant land under article 6 of the tree preservation order. The council’s resolution of November 27 1985, in his submission, accurately reflected what would have happened if consent had been given. I agree with Russell LJ and Taylor LJ that article 6, while not expressly so stating, must be confined to cases where consent is granted under the order to the felling of a part of a woodland in the course of forestry operations. Though Mr Carnwath drew our attention to the general words at the beginning of section 60(1) of the 1971 Act, I think it clear that article 6 was made pursuant to the authority given by the particular words of section 60(1)(b), and with those particular words in mind. The exception of ‘silvicultural thinning’ in article 6 lends support to the view that the article is dealing with consent given for the purpose of forestry operations. So does the reference in article 6 to section 175 of the 1971 Act, as Taylor LJ has explained.
I can see no compelling reason why the authority should need a power to impose conditions or directions requiring the replacement of trees comprised in a woodland where it gives its consent to the felling of such trees for the purpose of non-forestry operations, and I do not think that the prescribed form of order gives it any such power.
In cases where consent is given to the felling of trees not comprised in woodlands, the position in regard to replacement is sufficiently covered by article 4, which empowers the authority, in giving consent, to impose conditions requiring the replacement of trees. In general terms, article 5 of the order (quoted in Russell LJ’s judgment), read together with article 9, seems to me to indicate the clear intention of the order that a person who has suffered loss or damage in consequence of any refusal of consent under the order, or of any grant of consent subject to conditions, in respect of trees comprised in woodlands, shall be entitled to compensation unless the refusal or condition is in the interests of good forestry, and the authority has so certified under article 5(a). (The certificate procedure under article 5(b) is not available in respect of trees comprised in woodlands.)
For these reasons I am unable to accept what I have understood to be the three principal submissions advanced by Mr Carnwath. As regards the other points arising on this appeal, I do not wish to add anything to the judgment of Russell LJ.
I would vary the decision of the Lands Tribunal by substituting a figure of £38,851.27 for the sum awarded to the claimant by way of compensation but, subject to this variation, would dismiss this appeal.
The appeal was dismissed with costs. Leave to appeal to the House of Lords was refused.