Land at Normanton, West Yorkshire, acquired for industrial development–Adjoining area of "almost classic obsolescence" developed by local council as industrial estate with initially disappointing results–County council’s later project of industrial development and reclamation for large area, including reference and adjoining land–County council’s proposals, not the CPO, held to be "the scheme" under "Pointe Gourde" principle–Value-effect of scheme–Deductions for improvement of environment, advancement of ripeness and provision of access
William Glover
QC and Michael Fitzgerald (instructed by J Bird, of Stephenson & England,
of Huddersfield) appeared for the claimants; the Rt Hon Sir Derek Walker-Smith
QC MP and Matthew Caswell (instructed by Maurice Smith & Co, of Castleford)
for the acquiring authority.
Giving their
decision, MR WELLINGS and MR WALMSLEY said: This is a reference to determine
the compensation payable to John Bird and George Peter Bird by the Wakefield
Metropolitan District Council (as successors to the urban district council of
Normanton) on the acquisition of the claimants’ freehold interest in 29.8 acres
of land at Beckbridge Lane, Beckbridge Estate, Pontefract Road and Wain Dyke
Beck, Normanton, West Yorkshire.
On July 1 1969
the urban district council ("the council") made a compulsory purchase
order under section 28(1)(d) of the Town and Country Planning Act 1968 known as
the Urban District of Normanton (Industrial Land) Compulsory Purchase Order
1969. The land comprised in the order extended to 33.74 acres, comprising the
claimants’ land plus 3.94 acres of adjoining land. The order was confirmed on
June 19 1970. Notice to treat was served on August 7 1970, and notice of entry
on February 25 1971. Actual entry was made on April 5 1971, this being the date
by reference to which the compensation is to be assessed.
The subject
land lies to the south-west of Pontefract Road and to the south-east of
Castleford Road at Normanton in the West Riding of Yorkshire (now the
Metropolitan County of West Yorkshire), about 11 miles south of Leeds. There
are no buildings or trees on the land, which is triangular in shape, with a
gentle slope. There is no road frontage.
The purpose of
acquiring the order land was stated to be that of "securing its
development as a whole for industry."
This proposed industrial development was to be an extension of similar
development on abutting land to the north-west. This abutting land, between the
reference land and Castleford Road, was already owned by the authority.
The parties
are agreed that the open market value of the reference land at the relevant
date was £81,000. The claimants ask for this figure. The authority take the
view, however, that this amount includes an increase in value of £43,500, which
is entirely due to the scheme underlying the acquisition, and that by applying
the Pointe Gourde principle (to which we refer later) the compensation
properly payable is seen to be no more than £37,500.
The resolution
of this issue necessitates reciting a somewhat lengthy history of events,
condensed from evidence that was presented to us at much greater length during
the course of an eight-day hearing. There was one witness for the claimants, J
I Bartle FRICS, a partner in the firm of Bartle & Son, of Leeds. For the
authority, two witnesses were called, J D Binney BSc FRICS, district valuer,
and Michael J Thompson FRTPI ARICS, now county planning officer for South
Yorkshire County Council, but prior to local government reorganisation with the
West Riding County Council.
History of
Events
In the county
development plan a block of 22 1/2 acres of land, lying immediately to the
north-west of the reference land, was allocated for industrial development, and
in 1966 this allocation was increased to 37 1/2 acres. In or about 1965, the
council embarked on an active policy directed to securing such development. The
allocated land was entitled "the Beckbridge Industrial Estate," and
industrialists were sought to take up plots.
There were
difficulties. One difficulty was that considerable moneys were required for the
purchase of land not already in public ownership; also the drainage needed
improvement, and so did the environment. This last factor was an important one.
In the early 1960s, Normanton, it appears, presented a classic case of
obsolescence resulting from its historical dependence on a limited number of
industries locally in decline, notably coal mining and railways. The locality,
we were told, was a place which at that time was physically unattractive to
industrialists.
The council
set about removing these various difficulties. They already owned some 10 acres
of the proposed industrial estate and, between 1965 and 1967, they purchased a
further four ownerships, totalling some 17 acres. One of these purchases was of
a derelict five-acre chemical works, the clearance of which was a significant
contribution to the improvement of the environment. A tender was accepted for
improving the drainage of the area. Allotment holders were cleared in
anticipation of development. A publicity stand was taken at an exhibition of
the Federation of Industrial Development Association, and 500 copies of an
attractive glossy booklet "Expand at Normanton" were printed and
distributed.
Considerable
time, effort and (an unspecified amount of) money had been put into making a
success of Beckbridge Industrial Estate. But the results were disappointing. By
1966 only 0.26 acre had been disposed of, and by 1968, only a further 1.4
acres.
County
Council’s Project
Then in the
middle of 1968 a new factor emerged. As early as May 1966 officers of the
council had been having talks with officers of the county council in connection
with a policy document "A Growth Policy for the North," published in
February 1966 by the county council as part of the second review of the county
development plan. In June 1968 these informal consultations reached a stage of
formality. On June 24 1968 the county council’s town and country planning
committee resolved that discussions be held with officers of other councils
interested in an "industrial and reclamation project" in the
Whitwood-Hopetown area. On September 23 1968 the same committee met again: the
minutes of that meeting read:
"Whitwood/Hopetown
The planning
officer submitted a report, a copy of which had been circulated to each member
of the sub-committee prior to the meeting, recalling that the County Council in
July 1968 adopted a report and diagram on South Yorkshire which included a
proposal for the establishment of a major growth point of population and
industry in the Castleford, Normanton and Featherstone areas. The area selected
for industrial development lay astride the Lancashire/Yorkshire Motorway in the
Whitwood/Hopetown locality and embraced some of the most despoiled land in the
Yorkshire Coalfield. The principal colliery areas involved were the Whitwood
and West Riding pits, both of which were now closed down.
The total
area of land to be included in the scheme of reclamation and redevelopment, to
be undertaken in co-operation with the Castleford Borough and Normanton Urban
District Councils, amounted to about 770 acres. Of this total 450 acres
comprised abandoned pit yards and spoil heaps, the remaining 320 acres were not
derelict. Of the 450 acres of derelict land only about 50 acres could usefully
be reclaimed for industrial development, the remainder being recontoured and
landscaped to provide a suitable setting for the major industrial areas and
materially to improve this section of the motorway corridor. The scheme would
provide approximately 370 acres of land for industrial development.
Whilst the
preliminary estimates which had been prepared were subject to revision when
more detailed consideration was given to land acquisition costs and engineering
works it was believed that an expenditure in the order of £1,000,000 would be
involved. Some of this sum would be eligible for grant from the Central
Government.
Obviously a
scheme of this magnitude would be undertaken stage by stage and the work of
reclamation would probably be spread over a period of approximately five years
commencing in April 1969.
Recommended–
(1332)
(a) That, subject to a satisfactory grant
from Central Fund where appropriate and loan sanction being forthcoming, the
West Riding Town and Country Planning Committee be authorised to expend a sum
of not exceeding £1,093,300 on the acquisition of land in the Whitwood/Hopetown
area and works of reclamation thereon.
(b) That the West Riding Town and Country
Planning Committee be authorised to expend a sum of not exceeding £550 in
addition to the sum of £1,000 already authorised for aerial surveys of proposed
land reclamation sites, on the provision of a detailed survey of approximately
105 acres of the scheme by the use of aerial photography.
Resolved–
(1333)
(a) That a meeting with representatives
of the Castleford Borough and Normanton Urban District Councils be held to
discuss the extent of their participation in the scheme.
(b) That the budget estimates for 1969-70 include
a sum of £282,000 for the first phase of the scheme."
The above area
of "approximately 370 acres" for industrial development later
crystallised at 386 acres. The two recommendations above were accepted by the
county council on October 16 1968.
Meanwhile, on
October 7 1968, the clerk of the Normanton District Council had presented to
the policy committee of his council a lengthy report on their industrial area.
The opening paragraphs of that report read:
"It will
be remembered that in the Pontefract Road area your Council were originally
allocated on the town map some 22 1/2 acres of land for industrial development.
This was an area of almost classic obsolescence, badly affected by subsidence,
and required considerable moneys to be expended in clearance and treatment,
administration and purchase of land and properties before going on to the basic
planning. The Council, as you are aware, faced up to this matter both
administratively and financially despite their other problems. Four years’ work
has already gone into this area and quite a lot done. Eventually the area was
increased by means of a section 6(2) amendment to the town map, adding a
further 15 acres, some still to be cleared, but almost all which can be
utilised in a short stretch of time. This is the area on which the current
building is taking place. Finally, and this is only very recently, the County
Council were prepared to support the Council in an application for a further
section 6(2) amendment, adding an additional 39 acres approximately. This makes
the Council’s efforts on its own very substantial and to lay out an area of 76
acres after clearance and treatment, would have been in itself a tremendous
achievement and could have been done by the time the motorway would be opened
on the basis of the present impetus and policies of the Council.
Arising out
of proposals by the Yorkshire and Humberside Regional Economic Planning
Council, the West Riding County Council investigated a number of areas for the
establishment of strategic industrial areas of considerable size and with other
assets that were required for these purposes. This area was chosen for
expansion and I would say that the efforts of Normanton Council impressed the
County Council, who considered that the potential existed. If the impetus is
maintained it would appear that there is no reason why this strategic
industrial area should not be the jewel in the West Riding crown that has been
talked of."
The "additional
39 acres approximately" referred to by the clerk, included the reference
land of 29.8 acres. Also in October 1968, the county planning department
prepared a plan (exhibit no 15) which was almost identical to the plan relating
to site 3 in the 1971 brochure, which latter plan and brochure we describe
hereafter.
In August 1969
the county council published a brochure entitled "South Yorkshire
Industrial Sites" listing 15 sites where large-scale industrial and
associated uses would be supported, and in February 1971 a revised edition of
this brochure was published. The format and the make-up of both editions are
closely similar. Prefacing the contents of each is a set of notes which read
(in the 1971 edition):
"1. These proposals follow the ‘County Development
Plan, Second Review, South Yorkshire’ report approved by the West Riding County
Council on January 15 1969, and the County Strategy published in September
1969.
2. Each plan contained in this brochure
indicates a site or general location where, subject to a comprehensive scheme,
the County Council will support large-scale industrial and associated uses
and/or warehousing applications as appropriate.
3. In many cases, applications for planning
permission will be dealt with as major departures from the provisions of the
approved County Development Plan under the Town and Country Planning
(Development Plans) Direction 1965. The latest planning situation for each site
is given on the individual information sheets.
4. When considering applications, in addition
to the need for the comprehensive scheme mentioned in (2) above, the County
Council, as Local Planning Authority, will have regard to all relevant
physical, economic and social factors, among the most important of which are:
(a) The scale of male and female employment to
be provided by the development proposed in the application.
(b) The need to strengthen and diversify the
economic base in South Yorkshire.
(c) The capacity of the existing and proposed
road system to deal with the traffic expected to be generated by the
development.
(d) The availability of all services, such as
water supply and the means of disposal of both surface water and sewage or
trade effluent.
(e) The overall appearance, design, layout and
landscaping of the proposed development.
5. Within the above terms, preference will be
given to those concerns who are prepared to make a positive contribution to the
physical environment and economy of South Yorkshire.
6. Proposals for industrial development will
continue to be encouraged in other areas on sites which are allocated for this
purpose in the approved or draft Town Maps. Reference
industry and the local industrial sites.
7. The information contained in this brochure
should be verified with the appropriate authorities and, where appropriate, by
other private investigation for any site where development is contemplated.
8. General inquiries should be made in the
first instance to either the relevant local authority, the appropriate Area
Planning Office or to the County Planning Department, Wakefield.
9. Negotiations for the acquisition, or
leasing, of land should take place with the owners of the land. Details of land
ownerships may usually be obtained from the local authority with the exception
of site no’s 7 and 8 details of which may be obtained from my office."
Site 3
Described
Inside the
brochure there are 15 plans showing the boundaries of the sites referred to.
The Whitwood-Hopetown site is referenced no 3. The plan of site 3 is preceded
by a page which reads:
"Site
3. Whitwood-Hopetown (Castleford MB and Normanton UD)
Location: Grid Reference SE 400239. On either side of and immediately
adjacent to the proposed intersection of M62 and A655 (Wakefield-Castleford)
junction number 31. Adjacent to A639 (Leeds-Pontefract). Estimated travel time
to nearest motorway (proposed): 1 minute by medium commercial vehicle or car. Major
centres within 10 miles–Castleford (2 miles), Pontefract (4 1/2 miles),
Wakefield (6 miles), Leeds (10 miles).
Area: Approx 386 acres. 156 hectares.
Proposed
Use: Mainly industry.
Services: Electricity: Supply can be made available. Gas: Adequate quantity
available. Water: Reasonable quantity available, storage would be necessary.
Drainage: Improvements being undertaken.
Site
Stability: Site stable and unlikely to be disturbed
in the future.
Reclamation: Major works being carried out by West Riding County Council and
the district councils within and adjacent to the sites.
Public
Transport: Existing bus services past the site give
direct links to Doncaster, Leeds, Wakefield, Normanton and Castleford. On
completion of the M62, express services linking the area with Leeds are likely.
Nearest railheads for Inter-City passenger services and freight services are at
Leeds and Wakefield, and others at Normanton, Altofts and Castleford. The
Freightliner and Containerbase facilities at Stourton are 8 1/4 miles away via
the M1 and the proposed M62. The Wakefield branch of the Aire and Calder Canal,
which passes to the north of the site, is capable of taking vessels up to 250
tons, and gives direct access to the Humber ports and the Trent and South
Yorkshire waterway system.
Population
within 5-mile radius: 286,000 in 1970.
Addresses: Local Authorities: Castleford MBC, Town Hall, Castleford (tel
Castleford 3551). Normanton UDC, Town Hall, Normanton (tel Normanton 3182/6).
Featherstone UDC, Town Hall, Purston Park, Featherstone (tel Pontefract 71271).
Area Planning Office: Central Area. Springfield, Pontefract Road, Castleford
(tel Castleford 4455).
Note: A joint development committee has been formed consisting of the
West Riding County Council and Normanton Urban District Council with the aim of
promoting industrial development on a major part of the site, ie that to the
south of the proposed M62 motorway. Inquiries for land within the Normanton
Urban District should be made initially to the clerk of that authority, R E James.
A wide strip
of land–the site of the M62 motorway–bisected (but was excluded from the area
of) site 3; in 1968 this motorway had reached the drawing board; by April 1971
the M62 was out to tender, and the motorway has been in use since August 1974.
The part of
site 3 to the south of the motorway included, as might be expected, the
Beckbridge Industrial Estate. It also included the reference land together with
a substantial area south-east of the reference land which had previously been
intended as green belt. Also included was land across Pontefract Road,
comprising part of the 50 acres of derelict land which the county council had
decided could usefully be reclaimed for industrial development. But site 3 did
not include any of the further 400 acres of derelict land which the county
council proposed should be recontoured and landscaped.
We will refer
to the proposals for site 3 as "the county council scheme 3" or,
sometimes, as "scheme 3."
Events
Affecting Site 3
Between June
1968 and the date with which we are concerned in April 1971, a number of things
had happened affecting different parts of site 3 lying within the Normanton
Urban District. Thus:
Within the
37.5 acre Beckbridge Industrial Estate, the
council:
(a) had acquired further land, in particular a 6
1/2-acre site belonging to the National Coal Board and referred to as the
briquette works. These works were a notable dereliction, and their clearance
was undertaken as reclamation work necessary both for the improvement of the
environment and to make that site available for redevelopment.
(b) had cleared an estate of prefabs. This site
adjoined the briquette works and also the site of the chemical works cleared
earlier.
(c) had made a road (the "red road,"
as marked on our plans), to serve a particular factory.
(d) had made a road (the "green road,"
as marked on our plans), through the industrial estate as the main access to
the estate from the M62.
(e) had made a road (referred to as "access
D") from the point where the "red road" met the "green road." Access D formed a continuation of the
"red road" down towards the reference land but it stopped a few feet
short of the claimants’ boundary.
Adjoining
the Beckbridge Industrial Estate to the south-east,
the council had made the originating compulsory purchase order in the present
reference, in respect of 33.74 acres.
To the
south-east of the reference land, the council had
made a compulsory purchase order in respect of 51.14 acres of green belt land
for the purpose of securing its development for industry. (It is of interest
that this order was made in July 1970 but was not confirmed until December
1972, and that during this two-and-a-half-year interval a private company had
obtained an option to purchase the greater part of the land comprised in the
order, at a price of £3,000 per acre.)
Across
Pontefract Road, the council had made a compulsory
purchase order in respect of 15.11 acres of disused and semi-derelict land for
the purpose of reclamation. This order was made in July 1969 but, according to
a statement of agreed facts, was not confirmed until August 1971.
In respect
of the whole of the scheme 3 land lying within the urban district, the council had published a new edition of their booklet
"Expand at Normanton." This
new edition contains a plan of what was now entitled the "Normanton
Industrial Area," 150 acres. The 150 acres comprised the 37.5 acres, the
33.74 acres, the 51.14 acres, the 15.11 acres and a further small area: it is
agreed that the council’s policy was to acquire all the land within their
boundaries allocated for industrial development by the Whitwood-Hopetown
proposals. In respect of this area consultant architects had been appointed,
and had produced a draft layout.
From this
summary of the history of events we turn to the substantive issue in these
proceedings.
It is common
ground that the value of the reference land falls to be assessed under rule (2)
of section 5 of the Land Compensation Act 1961, but that any value thus
determined falls to be looked at in the context of the Pointe Gourde
principle, which requires that compensation must exclude any increase in value
which is entirely due to the scheme underlying the acquisition.
What is
"the Scheme"?
The
substantive issue between the parties is as to what is "the scheme
underlying the acquisition"–a phrase for which we will use our
abbreviation "the scheme."
For the
acquiring authority Sir Derek contends that the scheme is the county council
scheme 3. For the claimants, Mr Glover contends that the scheme is simply the compulsory
purchase order which authorises the acquisition of the 29.8 acres.
A number of
cases were cited for our assistance, both as to the basis of compensation and
as to the attributes of a scheme. The following dicta illustrate the
authorities on these two points:
The basis
of compensation
Lord
MacDermott in Pointe Gourde Quarrying & Transport Co Ltd v Sub-Intendent
of Crown Lands [1947] AC 565 ("the Pointe Gourde case"):
"It is
well settled that compensation for the compulsory acquisition of land cannot
include an increase in value which is entirely due to the scheme underlying the
acquisition."
Lord
Buckmaster in Fraser and Others v City of Fraserville [1917] AC
187 ("the Fraser case"):
". . .
the value to be ascertained is the value to the seller of the property in its
actual condition at the time of expropriation with all its existing advantages
and with all its possibilities, excluding any advantage due to the carrying out
of the scheme for which the property is compulsorily acquired, the question of
what is the scheme being a question of fact for the arbitrator in each
case."
Lord Denning
MR in Viscount Camrose and Another v Basingstoke Corporation
[1966] 3 All ER 161 ("the Camrose case"):
"The
explanation of s 6(1) [of the Land Compensation Act 1961] is, I think, this.
The legislature was aware of the general principle that, in assessing
compensation for compulsory acquisition of a defined parcel of land, you do not
take into account an increase in value of that parcel of land if the increase
is entirely due to the scheme involving the acquisition. That was settled by
[the Pointe Gourde case].
The
attributes of a scheme.
Wilson and
Another v Liverpool City Council [1971] 1
All ER 628 ("the Wilson case"):
Lord Denning
MR:
"A
scheme is a progressive thing. It starts vague and known to few. It becomes
more precise and better known as time goes on. Eventually it becomes precise
and definite and known to all. Correspondingly, its impact has a progressive
effect on values. At first it has little effect because it is so vague and
uncertain. As it becomes more precise and better known, so its impact increases
until it has an important effect. It is this increase, whether big or small,
which is to be disregarded as at the time when the value is to be assessed."
Widgery LJ:
"The
scheme will always exist in some shape or form by the time the notice to treat
is served. It must, indeed, be in some shape or form at the confirmation of the
compulsory purchase order itself, and then, as Lord Denning MR says, it may develop
almost from day to day, and the ultimate question for the valuer is to decide
to what extent the dead-ripe value of the land on the day on which the
valuation is to be made has been increased by reason of the existence of the
scheme."
The Lands
Tribunal (Sir Michael Rowe QC and Mr J Watson FRICS) in Kaye and Others
v Basingstoke Corporation (1968) 207 EG 545, 677, 727, 836, 904
("the Kaye case"):
"We
think a ‘scheme’ . . . must be a scheme sufficiently precise to enable an
owner, occupier or prospective purchaser to find out what it is. Vague
proposals to encourage industry to come to Basingstoke, as were made from
before the war down to the first town development agreement in 1959, were not
in our view sufficiently precise to enable any court to identify a scheme or,
to use Lord Romer’s words, ‘a particular scheme’."
Sir Derek
submits that, on the authorities and on the facts in the present case, the
county council scheme 3 complies exactly with the attributes of a scheme as
described by Lord Denning MR and Widgery LJ. It had proceeded on evolutionary
lines indicated by Lord Denning MR in the passage cited supra from Wilson
v Liverpool Corporation and satisfied the criteria there propounded by
him. That scheme had been in existence since the autumn of 1968 and had been
public knowledge since then.
Against this
Mr Glover submits that, notwithstanding the Pointe Gourde principle, a
claimant is entitled to receive the full market value of his land at the date
of valuation regardless of how that value had accrued; the only element to be
excluded from compensation is any enhancement in value shown to be entirely due
to the particular scheme underlying the acquisition. The scheme in the present
case, submits Mr Glover, cannot be the county council scheme 3 because that
scheme was prepared for a different purpose and by a different authority; its
purpose was to give information about a general planning policy to be carried
out by a number of defined schemes. Since the approval in 1963 of the county
development plan there had indeed been a number of schemes. Two of the earlier
schemes related to the Beck-bridge Industrial Estate. Only one scheme, however,
underlay the acquisition: that was the scheme, comprised in the relevant
compulsory purchase order.
With some hesitation
we have come to the conclusion that we should accept the contention for the
acquiring authority, that the county council scheme 3 is to be regarded as the
scheme underlying the present acquisition. We have concluded that the scheme
constituted a single scheme underlying the acquisition and that earlier schemes
referred to by Mr Glover had merged into it, notwithstanding their several and
disparate beginnings.
Valuation
Evidence
We have
mentioned earlier that the claim is for a figure of £81,000, against which the
authority’s figure is £37,500. The actual valuations produced were as follows:
Valuation
by J I Bartle, FRICS for the claimants
29.8 acres @
£2,700 per acre = £81,000
Valuation
by J D Binney BSc FRICS for the authority
29.8 acres @
£1,250 per acre = £37,500
Both these
valuations were in the "no-scheme world," but inasmuch as Mr Bartle
had adopted the assumption that the scheme was simply the compulsory purchase
order giving rise to the acquisition, his figure of £81,000 is to be regarded
as being also a value in the "real world." The term "real world" is being used
to connote the physical and actual state of affairs existing at the revelant
date, April 5 1971, and all incidents then affecting the reference land and
other land, both in respect of physical characteristics and planning
circumstances, including the existence of the scheme. The term "no-scheme
world" connotes the state of affairs that would have appertained, in
respect of the reference land and of other land, at the relevant date in the
absence of the scheme, both in respect of physical characteristics and planning
circumstances.
Mr Binney also
produced what he referred to as his "secondary valuation" which (with
its wording slightly adjusted for convenience of reference) was as follows:
Secondary valuation by J D Binney BSc FRICS for the authority
|
Value of the |
£81,000 |
|
Deduct |
|
|
(a) Environment. The environment of the |
|
|
worth less by £300 per acre |
8,940 |
|
£72,060 |
|
(b) Deferment. The reference land is |
0.751 |
|
£54,117 |
|
|
(c) Provision of access. In the |
17,880 |
|
£36,237 |
The above figure of £36,237 was rounded up by Mr Binney to £37,500,
bringing it into line with his primary valuation.
Tribunal’s
Finding as to Value
We regret that
we find Mr Bartle’s valuation to be of no assistance. This is because there is
no provision within it for the value-effect of the scheme as we have found it.
We are left with Mr Binney’s estimate of value. But we find the district
valuer’s primary valuation to be of no more assistance to us than Mr
Bartle’s valuation. This is because Mr Binney had made a basic assumption
regarding the "no-scheme world" which we consider to be incorrect and
for which it is not possible to make the requisite correction within the
framework of his primary valuation.
The error (as
we see it) to which we refer is Mr Binney’s assumption that, because the area
of the county council scheme 3 includes the Beckbridge Industrial Estate, it is
a corollary that the "no-scheme world" must be envisaged as that
which appertained before the council had embarked on the development of that
estate. Mr Binney’s concept of the "no-scheme world" was accordingly
one in which, for instance, the land abutting the reference land on the
north-west–albeit allocated for industry–was still in fragmented ownerships and
with the chemical works and the briquette works still standing. This concept
would be correct if the purpose of the Pointe Gourde principle were to
exclude any increase in value caused by any public expenditure. But, on
the authorities, the Pointe Gourde principle extends no further than the
exclusion of any enhancement in value shown to be entirely due to the
particular scheme underlying the acquisition. In the present reference, we have
found the scheme to be the county council scheme 3. That scheme came into
existence, and then only in a vague form, no earlier than June or July 1968. As
from mid-1968 whatever happened may be regarded as happening in the context of
the scheme, but it is self-evident that nothing which happened prior to, say,
June 1968 could have been due to the scheme.
In such a
context the method of valuation to be adopted has been formulated by the Court
of Appeal in Myers v Milton Keynes Development Corporation [1974]
2 All ER 1096, a case which concerned land in a new town. Lord Denning MR
giving the judgment of the court said at 1102:
"It
comes to this: in valuing the estate you are to disregard the effect of the
scheme, but you are to assume the availability of planning permission. . . .
. . . And you
are to value that land with that permission in the setting in which it would
have been if there had been no scheme.
. . . It is apparent therefore, that the
valuation has to be done in an imaginary state of affairs in which there is no
scheme. The valuer must cast aside his knowledge of what has in fact happened .
. . due to the scheme. He must ignore the developments which will in all
probability take place in the future . . . owing to the scheme. Instead, 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 to be the old order of things continuing . . ."
Applying the
above dictum to the circumstances of the present case it would seem necessary
for us, as a practical exercise:
(a) to start with the real world of April 1971,
(b) to cast aside our knowledge of what in fact
happened since June 1968, and
(c) to decide the setting in which the reference
land would have been in April 1971 if there had not been, and would not be, the
county council scheme 3.
"Taking
Flight to the Clouds"
As regards
(a), we have already described the circumstances of the real world of April
1971. We have also, as regards (b), described what in fact happened since June
1968. Coming then to (c) it remains for us to decide (letting our
"imagination take flight to the clouds") what would have happened in
the absence of the scheme.
It will be
recollected that by June 1968 the development of the Beckbridge Industrial
Estate was already well in hand under the impetus and policies of the council.
We take the view that, in the absence of the scheme, that impetus would have
been sustained and those policies would have been continued, and that by April
1971:
(a) the ownership within the
industrial estate would have been unified,
(b) the briquette works would
have been cleared,
(c) the estate of prefabs
would have been cleared,
(d) the "red road"
would have been made, and
(e) the "green
road" (or its equivalent) would have been made.
Things that
would, we think, not have happened include:
(a) the making of access D.
(b) the making of the order
for the acquisition of the 33.74 acres.
(c) the making of the order
for the acquisition of the 51.14 acres.
(d) the making of the order
for the acquisition of the 15.11 acres.
This being the
valuation setting envisaged, we turn now to the district valuer’s secondary
valuation, the form of which enables us to test his opinion of value in the
light of our findings as to the "no-scheme world."
What Mr
Binney’s secondary valuation shows, in brief, is:
|
Value in the real world |
|
|
£81,000 |
|
Deduct, as being due to |
|
|
|
|
(a) for improvement of the environment |
£8,940 |
|
|
|
(b) for advancement of ripeness |
£17,943 |
|
|
|
(c) for provision of a suitable access |
£17,880 |
|
|
|
|
|
£44,763 |
|
|
|
|
£36,237 |
|
|
Say |
|
£37,500 |
We will take the elements in the valuation seriatim:
Value in
the real world. We had thought, at one stage of the
hearing, that £81,000 was an agreed common starting point for both valuation
witnesses. But this, it transpired, was not so. Mr Binney’s valuation at that
figure is on the assumption that, in the real world, access D would have been
freely available for use. Mr Bartle, on the other hand, had taken the view that
in a "no scheme world" identical, in all valuation respects, with the
real world, access D would not have been available at all. If, said Mr Bartle,
access D had been regarded as available his valuation figure would have been
£9,000 higher at £90,000.
Having heard
all the evidence, including details of various comparables, we are satisfied
that the reference land in April 1971 would not have commanded a value of
£81,000
Deductions Due
to Scheme
Deduction
for improvement of the environment. In the
valuation setting that is envisaged by us, the briquette works and the chemical
works are assumed to have been cleared, but no proposal exists for reclaiming
the land across Pontefract Road. In cross-examination Mr Binney said that his
deduction for improvement of the environment could be regarded as apportionable
equally between (a) the clearance of the two works’ premises and (b) the
reclamation of the land across Pontefract Road. We accept this apportionment,
and our deduction under this head is accordingly £4,470.
Deduction
for advancement of ripeness. We accept Mr Binney’s
opinion that, by reference to a "no-scheme world" of, say, 1965, one
effect of the county council scheme 3 was to advance the ripeness for
development of the subject land by three years. But, by reference to the
"no-scheme world" of June 1968, this advancement will have been
something less. In view, however, of the comparative lack of success attendant
on the council’s promotional efforts between 1965 and 1968, the greater part of
the advancement in ripeness must be attributable to what happened during the
period 1968 to 1971. Our deduction under this head is based on a deferment
period of two years.
Deduction
for provision of access. The obvious access to the
reference land in April 1971 was by way of access D, if available. That access
road is not of full width, having only a 15-ft carriageway, but, as we have
already indicated, the land would not, in our opinion, have been worth £81,000
at that date unless it be assumed that access D was freely available. In the
"no-scheme world," as we envisage it, access D would not even have
been made, and a purchaser would have had to look elsewhere for access points.
He would have found three other accesses:
Access A at the eastern corner, by a 12-ft-wide track from Pontefract Road.
Access B on the north-west side, through the acquiring authority’s housing
development.
Access C from the western side, by an unmade road about 40 ft wide leading
to Castleford Road.
We heard a
great deal of evidence about the origins and characteristics of accesses A, B
and C. Mr Binney thought that a purchaser would have regarded all three
accesses as wholly unsuitable and would have allowed nearly £18,000 for
negotiating a completely new access north-eastwards to Pontefract Road. Mr
Bartle, as has been seen, took the view that the actual or assumed
non-availability of access D made a difference in value of £9,000. We regard Mr
Bartle’s assessment as being the more realistic and we adopt his figure. Our
deduction under this head is accordingly £9,000 and we think it more logical to
make this deduction before applying the deferment factor.
Tribunal’s
Award
In the outcome
our finding is for a value of £56,000 made up thus:
|
Value in the Real World |
|
|
£81,000 |
|
Deduct as being due to |
|
|
|
|
(a) for improvement of the environment |
£4,470 |
|
|
|
(b) for provision of a suitable access |
£9,000 |
|
|
|
|
|
£13,470 |
|
|
|
|
£67,530 |
|
|
(c) for advancement of ripeness, defer two |
|
|
0.826 |
|
|
|
£55,780 |
|
|
Say |
|
£56,000 |
In our opinion the value of the reference land at the relevant date
had been enhanced from £56,000 to £81,000 by the very project or scheme which
had given rise to the acquisition.
The acquiring
authority will pay the claimants the sum of £56,000 to which will be added a
surveyor’s fee based on scale 5(a) of the scales of professional charges of the
Royal Institution of Chartered Surveyors, plus VAT, also any legal costs
properly incurred from the date of the notice to treat up to the date of the
notice of reference.
ADDENDUM
It may be
helpful to state that the alternative amount we would have awarded if we had
decided that the county council scheme 3 was not, by its nature, capable of
constituting "the scheme underlying the acquisition" would have been
the sum of £81,000.
Having opened
the sealed offer of compensation lodged by the acquiring authority, we find
that the amount thereof is less than the amount of our award; accordingly the
acquiring authority will pay to the claimants their costs of this reference,
such costs unless agreed to be taxed by the registrar of the Lands Tribunal on
the High Court scale.
