Compensation for acquisition of land — General vesting declaration — Lands Tribunal — Reference to tribunal after expiration of six-year period of limitation — Whether claim barred by section 10(3) of Compulsory Purchase (Vesting Declarations) Act 1981 — Whether acquiring authority estopped from relying on statutory limitation period
On October 10
1986 land belonging to the claimants vested in the acquiring authority
following the making of a general vesting declaration under the Compulsory
Purchase (Vesting Declarations) Act 1981. Between August 1988 and December 1994
negotiations and correspondence took place between the parties’ respective
valuers in attempts to settle the compensation claim. The reference to the
Lands Tribunal was made in August 1994. The acquiring authority’s application
to the tribunal, to have the reference struck out on the ground that it had
been made more than six years after the vesting date, contrary to section 10(3)
of the 1981 Act, was dismissed by the president. The acquiring authority
appealed.
time-limit, in section 10(3) of the 1981 Act, is procedural, capable of being
waived or the subject-matter of estoppel by and on behalf of the acquiring
authority. There was ample evidence upon which the tribunal could hold that it
would be unconscionable for the acquiring authority to rely upon the six-year
period of limitation having regard to the way in which they conducted the
negotiations and to their reaction to the reference once it had been made. They
sought an extension of time without referring to the fact that the reference
was flawed from the outset.
The following
cases are referred to in this report.
Canada
Southern Railway Co v International Bridge Co
(1883) 8 AC 723
Co-operative
Wholesale Society v Chester-le-Street District
Council [1996] 2 EGLR 143; [1996] 46 EG 158
This was an
appeal by Chester-le-Street District Council by way of case stated from the
decision of the president of the Lands Tribunal ([1996] 2 EGLR 143), who had
dismissed their application to strike out a reference by the respondent,
Co-operative Wholesale Society Ltd, for the determination of a compensation
claim.
Frances
Patterson QC (instructed by Dickinson Dees, of Newcastle upon Tyne) appeared
for the appellants; Nicholas Huskinson (instructed by Watson Burton, of
Newcastle upon Tyne) represented the respondent.
Giving
judgment, SIR PATRICK RUSSELL said: This is an appeal by way of case stated from
an order of the Lands Tribunal under the presidency of Judge Bernard Marder QC,
who, on June 27 1996, upon a preliminary point of law, ruled that the
respondent, Co-operative Wholesale Society (the society), should be at liberty
to pursue its claim for compensation before the tribunal arising out of the
compulsory acquisition of its land by the appellants, Chester-le-Street
District Council. The tribunal ruled that the society was at liberty to pursue
its claim notwithstanding the provisions of section 10(3) of the Compulsory
Purchase (Vesting Declarations) Act 1981.
The provisions
of the statute relevant to this appeal are as follows. Section 10(3):
The time
within which a question of disputed compensation arising out of an acquisition
of an interest in land in respect of which a notice to treat is deemed to have
been served by virtue of Part III of this Act may be referred to the Lands
Tribunal shall be 6 years from the date at 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 by virtue
of Part III of this Act.
Then there
followed these important words:
This
subsection shall be construed as one with Part I of the Limitation Act 1980.
The background
to this appeal can be stated comparatively shortly. The subject-matter of the
compulsory acquisition was a department store in Front Street,
Chester-le-Street, together with adjoining land owned by the society. In May
1983 the acquiring authority made a compulsory purchase order that included the
subject land among a number of other properties, which it was proposed to
involve in the redevelopment of the town. Thereafter there were extensive
negotiations. The compulsory purchase order was confirmed by the Secretary of
State on March 6 1986. No notice to treat was served, but instead, because
there had been a considerable number of acquisitions pursuant to the orders, a
general vesting declaration was made on July 28 1986 and by virtue of that
declaration the land belonging to the society vested in the authority on
October 10 1986. It is common ground that the relevant date for the purposes of
section 10(3) was October 10 1986 and that the relevant period prescribed in
the section expired on October 10 1992.
Negotiations
between the parties did not result in any part being played by the society in
the redevelopment of the town centre and, accordingly, by the beginning of
August 1988, the society and the district valuer, on behalf of the authority,
together assumed the task of trying to agree appropriate compensation to be
paid to the society by the authority. The first offer of the district valuer on
behalf of the authority was made on August 1 1988. It was in the sum of
£10,000. The valuers then instructed by the society rejected that offer in
September 1988. The district valuer made a further offer in September 1989.
That too was rejected. In January 1991, and again in August 1991, the authority
were pressing the society, but to no avail. However, in October 1991 Mr Matthew
Bissett frics, a chartered
surveyor from Newcastle upon Tyne, came on the scene and opened further talks
with the district valuer. They continued through to April 1992 without any
agreement as to compensation being reached.
On July 31
1992 Mr Bissett wrote to the district valuer asking for yet a further meeting
as soon as possible following his return from holiday, in August 1992. The
meeting took place on September 15 1992. According to Mr Bissett — and this was
not challenged by the authority — there was a discussion about the views the
Lands Tribunal might take if the matter went to the tribunal, but no mention
was made by either side of any deadline. The district valuer and Mr Bissett,
according to the latter who gave evidence before the tribunal, considered that
their preference would be to avoid a reference to the tribunal. The
negotiations dragged on and there was a meeting as late as January 1994. A
further offer of settlement was put forward by the district valuer, which Mr
Bissett reported to his principals, the society. The response of the society
was to instruct Mr Bissett to refer the claim to the Lands Tribunal. He
obtained the necessary forms in April 1994. On June 20 1994 the authority wrote
to Mr Bissett stating, inter alia:
The District
Valuer has been instructed over a long period to negotiate compensation over
this particular site.
Please
confirm that you have instructions to negotiate a settlement of compensation
payable, and I shall request the District Valuer to contact you.
Reference to
the Lands Tribunal was made on August 23 1994. On two occasions thereafter Mr
Bissett agreed with the district valuer to an extension of time for the lodging
of expert reports in accordance with the directions of the Lands Tribunal.
Then, out of the blue, and it must have come as a bombshell to the society, by
letter dated January 13 1995 solicitors acting for the authority applied to the
tribunal for dismissal of the reference, on the ground that it had been made
out of time. Whether that ousted the jurisdiction of the Lands Tribunal in the
circumstances of this case was originally at the heart of the first ground of
appeal.
What were
the findings of the president on the preliminary point of law?
In a fairly
lengthy decision the following passage appears [[1996] 2 EGLR 143 at p144L]:
Mr Bissett
eventually met the district valuer again on September 15 1992 when they
discussed the appropriate basis for valuing the compensation claim. Mr Bissett
recalled that at this meeting they discussed the view which the Lands Tribunal
might take of their respective arguments, but there was never any discussion as
to the necessity to refer the matter to the Lands Tribunal by a certain date,
‘simply because both Mr Hodgson and I considered that our preference would be
to settle this matter by agreement and avoid a Lands Tribunal reference. The
six-year deadline was never referred to either by Mr Hodgson or his successor
as district valuer’.
It is inherent
in that finding of fact, together with the history I have endeavoured to
outline briefly, that it was always of the essence of the meetings between the
two valuers and plainly understood between them, that, so far as was possible,
there should not be a reference to the Lands Tribunal, but that the far more
acceptable way forward from the point of view of both sides was that there
should be a negotiated settlement. This is indeed the finding of the tribunal.
This passage appears in its decision [[1996] 2 EGLR 143 at p147M]:
In my
judgment, the evidence establishes that both parties in this transaction
proceeded on the basis of a common assumption that they were negotiating
settlement of a valid claim for compensation without regard to the statutory
limitation period and on the basis that if agreement could not be achieved the
matter would in the last resort be referred to the tribunal for determination.
It is
convenient at this stage to look again at the terms of the statute that impose
a limitation. The last sentence of section 10(3), already cited, reads:
This
subsection shall be construed as one with Part I of the Limitation Act 1980.
If one goes to
Part I of the Limitation Act 1980 one sees that it is concerned with a variety
of causes of action, each of which has its own limitation period. Miss Frances
Patterson QC, for the appellants, readily acknowledged that there is ample
authority for the proposition that in relation to a number of causes of action
set out in Part I of the Limitation Act 1980, they can be overridden by, for
example, contract between the parties, by waiver or by estoppel or
unconscionable conduct on the part of one of the parties to the dispute. Thus,
so the argument goes, and, in my judgment, it is an unanswerable argument,
section 10(3), being construed as one with Part I of the Limitation Act 1980,
has as its limitations precisely the same limitations as authority has
demonstrated to be the case under Part I of the Limitation Act 1980. If any
authority were necessary for that proposition it is to be found, for example,
in the words of Lord Selborne LC, in Canada Southern Railway Co v International
Bridge Co (1883) 8 AC 723 at p727. Lord Selborne, referring to two statutes
that were then in question, said:
It is to be
observed that those two Acts are to be read together by the express provision
of the 7th and concluding section of the amending Act; and therefore we must
construe every part of each of them as if it had been contained in one Act,
unless there is some manifest discrepancy, making it necessary to hold that the
later Act has to some extent modified something found in the earlier Act.
There is
nothing in the later Act, in the instant appeal, to modify the earlier Act.
Accordingly,
although originally in the skeleton arguments it was submitted on behalf of the
appellant that the provisions of section 10(3) were jurisdictional, preventing,
by agreement between the parties, by estoppel or by waiver, any departure from
the period of six years laid down in section 10(3), as the argument developed
Miss Patterson acknowledged that she could not advance the matter further and
that, indeed, in the light of authority and, I would add, in the light of the
plain words of section 10(3), the provision is procedural, capable of being
waived or the subject-matter of estoppel by and on behalf of Chester-le-Street
District Council.
That leads one
to the second ground of appeal, namely that even if, in truth, section 10(3)
was a procedural provision, there was here factually insufficient material to
enable the tribunal to make the finding that it did, namely that the authority
were estopped by their own conduct from asserting that the six-year period of
limitation did not apply.
My answer to
that submission is to be found in the award itself. There are plain findings of
fact. They were supported by the oral testimony of Mr Bissett. It is manifestly
plain, as I earlier commented, that throughout the negotiations in which Mr
Bissett took part, it was common ground between him and the valuer instructed
by the authority that there should not be a reference to the tribunal save as a
possible last resort, and only then when all efforts to reach a negotiated
settlement had failed. There was, in my judgment, as the judgment of Judge
Marder discloses, ample material upon which he could hold that it would be
unconscionable for the authority to rely upon the six-year period of
limitation, having regard to the way in which they conducted the negotiations,
and, indeed, having regard to their reaction to the reference once it had been
made and to the fact that they sought an extension of time without referring to
the fact that the reference was flawed from the outset.
In my judgment,
this appeal, in the light of the findings of fact, and in the light of the
concessions that Miss Patterson now feels constrained to make as to the true
nature of section 10(3), is an unarguable appeal and I would dismiss it.
MUMMERY and EVANS LJJ agreed and did not add
anything.
Appeal
dismissed with costs.
