Compulsory purchase – Compensation – Section 261(1)(a) of Highways Act 1980 – Part of claimant’s service station acquired for road scheme – One access route to service station closed – Subsequent order stopping-up redundant highway land to provide new access for claimant – Whether increase in value of claimant’s land attributable to prospect of such provision to be set off against compensation claim in respect of value of land acquired – Whether provision of access part of “purpose” of acquisition within section 261(1)(a) – Appropriate valuation date – Preliminary issues determined
The respondent acquiring authority acquired land that formed part of the claimant’s petrol filling and service station under a compulsory purchase order (CPO) that had been made for purposes including “the construction and improvement of highways and the provision of new means of access to premises…”. The scheme resulted in the claimant losing one of its two accesses to the service station, with the result that heavy goods vehicles could not gain access to the station. Proposals for an order to provide the claimant with a new access across other land that was included in the CPO did not come to fruition. In May 2002, a new order was made, stopping up part of the old redundant highway abutting the claimant’s remaining land and thereby enabling the claimant to construct a new access across that land.
The claimant referred a claim for compensation to the Lands Tribunal. The respondent raised the point that, in assessing compensation for the value of the land taken, the sum payable should be reduced to take account of betterment resulting from the new access provided for the claimant under the 2002 order; it relied upon section 261(1)(a) of the Highways Act 1980, which required the tribunal, when assessing compensation, to have regard to the extent to which the claimant’s remaining lands “may be benefited by the purpose for which the land is authorised to be acquired”. The claimant submitted that the “purpose” of the compulsory acquisition of its land was to construct the new road, of which the provision of a new access was merely a consequence and not part of the relevant purpose within the meaning of section 261(1)(a).
The parties also differed as to the appropriate valuation date: the claimant maintained that the respondent had entered and taken possession of its land in July 2001, but the respondent contended that it was March 2001. The respondent also contended that since the claimant’s new access had not been thought of at the latter date, any uplift in the value of the land acquired that was attributable to it fell to be disregarded in assessing compensation. Preliminary issues were determined as to the application of section 261(1)(a) and the appropriate valuation date.
Decision: The preliminary issues were determined in favour of the respondent.
(1) Although the “land… authorised to be acquired” in section 261(1)(a) meant specifically the land of the party that claimed compensation, the “purpose” of its acquisition included the entire scheme or project. The stated purposes of the CPO included the “provision of new means of access”, and that purpose was not excluded from the “purpose” under section 261(1)(a) merely because such access was to be provided on land other than the subject land. Further, the CPO had incorporated reference to the other orders in pursuance of which the works of construction and improvement were to be carried out; those orders together provided for the scheme that was to be carried out: Moto Hospitality Ltd v Secretary of State for Transport [2007] EWCA Civ 764; [2007] RVR 247 applied. It was the benefit derived by the retained land from that scheme or project that was to be brought into the reckoning, under section 261(1)(a), in assessing compensation. The purpose of the section was to bring into account the increase in value of the claimant’s retained land arising from the scheme so that it could be off set against the value of the land acquired. Such increase fell to be determined as at the valuation date in the light of the factors that bore upon it at that time. Accordingly, any prospect, as it existed at the valuation date and as it would have been perceived by the market at the time, of the secretary of state making the stopping-up order that he in fact made in the 2002 order to provide the claimant with a new access fell to be taken into account for the purpose of applying section 261(1)(a). The existence of such a prospect at that time was a matter for evidence at the substantive hearing.
(2) Entry onto the claimant’s land in February or March 2001, in order to remove hedges and other vegetation as a preliminary to the works, amounted to entering onto and taking possession of the entire subject land in the exercise of the respondent’s statutory powers. The works were not minimal and had been carried out for the purpose of enabling the construction operations to proceed; it was immaterial that the claimant was able to continue operating the service station. March 2001 should be taken as the date of entry and accordingly as the appropriate valuation date.
Michael Barnes QC and Eian Caws (instructed by Bircham Dyson Bell) appeared for the claimant; David Forsdick (instructed by th Treasury Solicitor) appeared for the respondent.
Sally Dobson, barrister
