Compulsory purchase – Compensation – Surveyor’s fees – Assessment of compensation for compulsory purchase of flat – Acquiring authority disputing sum claimed for surveyor’s fees and claimant’s personal time – Whether surveyor’s fees disproportionate to size and complexity of claim – Whether evidence supporting claims for personal time and costs – Claim determined accordingly
The claimant was the leaseholder of a two-bedroom flat in a building in London NW10. The acquiring authority transferred their freehold interest in the building to a registered social landlord in 2000 and subsequently granted planning permission for its demolition and replacement with a new block of flats. In September 2008 the authority acquired the claimant’s interest pursuant to a compulsory purchase order (CPO). The authority agreed to pay compensation of £253,096 to the claimant, representing the £200,000 market value of her flat, a home loss payment of 15% and payments in respect of fees and disturbance. However, it disputed certain of the sums claimed in respect of surveyor’s fees and various disturbance items. The disputed claim amounts to £39,025.
In particular, the authority disputed the fees charged by a surveyor whom the claimant had retained to assist her in negotiating her compensation claim and the purchase of a new property. The negotiations had included proposals for the claimant to acquire a flat in the new block on a shared equity basis, although she had eventually purchased a flat elsewhere. The surveyor invoiced £38,500, inclusive of VAT, for work done after the confirmation of the CPO in assisting the claimant to find an alternative property, attending progress meetings and negotiating with the authority’s valuer. The invoice charged an hourly rate of £150, although, at the outset of negotiations, the authority had previously agreed to £140.
The surveyor sought to justify the amount of fees by reference to the difficulties faced by the claimant, who did not speak good English, found it difficult to understand the compulsory purchase process, had disabilities due to an accident and could no longer work; and who, furthermore, had a low value property in a high value area which made it difficult to find an affordable alternative property nearby.
The authority also disputed their liability to pay more than £2,000 claimed in respect of the claimant’s own estimated personal time, at a rate of £35 per hour, and costs incurred on viewing alternative properties, including travel costs of £112.50 and mobile phone bills of £50.
Held: The claim was determined accordingly.
(1) The claimant’s surveyor had been obliged to undertake more work than might otherwise have been the case owing to changes in the authority’s personnel, which had led to the authority reviewing and changing their attitude to the claim and to the value of the claimant’s property. The particular difficulties faced by the claimant were further factors increasing the time reasonably spent on the claim. However, the claim was not a complex one. It involved the valuation of a two-bedroom flat at £200,000 and the assessment of disturbance costs arising. The amount charged by the surveyor, representing nearly 20% of the value of the property, was disproportionate to the nature and scope of his instructions and to the size and complexity of the claim. In particular, a disproportionate amount had been spent on travel to assisting the claimant at a large number of property viewings when a more discriminating filter in terms of size, price and the required facilities would have reduced the necessity for so many inspections. Moreover, there were certain elements of double or triple accounting and, furthermore, the surveyor had not consulted either his client or the authority about the increase in his hourly rate from £140 to £150.
(2) There was no evidence to support the claim in respect of the claimant’s personal time and costs. It was important to obtain supporting evidence for such a claim. The figures given by the claimant were simply estimates and no details were given of which properties were inspected, how far away they or how long it took to get there. No justification was given for the travel cost or the claim for mobile phone calls. The hourly rate claimed for the claimant’s own time was arbitrary, given that the claimant was not working and was receiving disability benefit. In the absence of any explanation or evidence in support of her claims for personal time and costs, other than an assertion that they were reasonable estimates, and given that the claim for the surveyor’s fees already included time spent searching for and inspecting alternative accommodation, no award should be made in respect of those claims: Thomas Newall Ltd v Lancaster City Council [2013] EWCA Civ 802; [2013] JPL 1531 considered. Certain other items which the claimant sought to recover in respect of disturbance loss were similarly unsupported by evidence and should be disallowed.
Overall, the outstanding compensation payable by the acquiring authority was £26,930.50.
Richard Murphy MRICS appeared for the claimant; Emmaline Lambert (instructed by the legal department of Brent London Borough Council) appeared for the acquiring authority.
Sally Dobson, barrister
Click here to read the transcript of DaSilva v Brent London Borough Council
