Compensation for the acquisition of land — Surveyor’s fees — Whether implied agreement that surveyor’s fees for professional services in relation to compensation for the acquisition were to be limited to the amount allowed by the acquiring authority — Appeal from decision of county court judge rejecting a claim by the plaintiff surveyor to the balance of fees not covered by the authority’s contribution — The surveyor’s claim had been in respect of two sites owned by the defendants, a 3-acre and a 7-acre site, but there was no appeal against the judge’s award in respect of the 3-acre site; the present appeal concerned the 7-acre site only
claim in respect of the 7-acre site was for £3,827.20, being the balance of
professional fees after allowing for the amount paid by the local authority —
It was common ground that there had been no express agreement or discussion
between the parties as to the fees payable — Defendants said that they had
throughout expected that the whole of the fees would be met by the authority
and they pleaded an implied term to the effect that the plaintiff would not
make any additional charge — As Parker LJ pointed out, this was a remarkable
implied term, as it meant that the plaintiff had bound himself to accept
whatever the authority chose to include as fees in the figure for compensation,
without having any right to complain either to the authority or to the
defendants — In any case there was nothing in the correspondence or dealings
between the parties to justify any such implication — The plaintiff (appellant
in the present proceedings) considered that he would be receiving a
contribution to his fees from the authority and it was submitted on his behalf
that, as a professional man, he should be entitled to a reasonable remuneration,
the onus of displacing this presumption and establishing an implied term to the
contrary being on the respondents
court judge, however, preferred the respondents’ evidence and concluded ‘that
the parties worked on the common basis of what has been called Ryde’s Scale’,
by which he meant that the plaintiff would not be entitled to be paid for his
work any more than the prescribed amount which the district valuer was
authorised to allow as an element of the compensation — The Court of Appeal
held that this conclusion rendered the judgment unsustainable, as the matter
had not been ventilated in cross-examination at the trial and the plaintiff
there had been given no opportunity to deal with it — This led to an
unfortunate result — The judgment could not stand and the Court of Appeal did
not have the material on which to substitute a finding of their own —
Therefore, although ‘with the greatest possible reluctance’, there was no
alternative but to direct a new trial — Appeal allowed and new trial ordered
The following
case is referred to in this report.
Lee v Minister of Transport [1966] 1 QB 111; [1965] 3 WLR 553;
[1965] 3 All ER 986; (1965) 63 LGR 327; 17 P&CR 181; [1965] EGD 176; 194 EG
1087, CA
This was an
appeal by the plaintiff, Donald Miles Radcliffe Francis FRICS FRVA (practising
as Jno Oliver Watkins & Francis), from the decision of Judge Martin
Stephens QC at Cardiff County Court in favour of the defendants, Brian Harris
and Janice Harris, his wife, the present respondents, in the plaintiff’s action
in respect of professional fees in relation to compensation for the compulsory
acquisition of land owned by the respondents.
N Cooke
(instructed by Belmont Craymer, agents for Hugh James Jones & Jenkins, of
Cardiff) appeared on behalf of the appellant; Geraint Jones (instructed by
James Morgan & Co, of Cardiff) represented the respondents.
Giving
judgment, PARKER LJ said: This is an appeal from a judgment of His Honour Judge
Martin Stephens QC sitting in the Cardiff County Court on May 8 of last year in
respect of a claim for the unpaid balance of professional fees against the
defendants. The learned judge awarded the plaintiff the sum of £460.57 in
respect of the unpaid fees and a little over £180 in respect of interest, and
there were also provisions for costs. The plaintiff appeals and seeks
alternative relief: first, that the judgment should be set aside and in place
thereof judgment should be entered for £4,287.77 plus interest and costs.
Alternatively, he asks that the matter should be referred for a new trial or
that it should be remitted to the county court for the assessment of the amount
due and owing by the defendants.
The claim
related to two parcels of land owned by the defendants which the local
authority wished to acquire by compulsory purchase order. I shall refer to the
two parcels of land respectively as ‘the 7-acre site’ and ‘the 3-acre site’.
The plaintiff
was engaged in 1977 in obtaining the best compensation that he could in respect
of both sites. In 1979 he was also asked to obtain planning permission in
respect of the 3-acre site. The learned judge wholly rejected the claim with
regard to the 7-acre site, but held that the remuneration for the 3-acre site
was properly £1,243, of which the plaintiff had been paid £442.50 by the local
authority and £400 by the defendants, leaving a balance due for which he gave
judgment. The figures in the note of judgment do not precisely tie up with the
formal order, but that is a matter of no importance.
So far as the
3-acre award is concerned, the matter is not under appeal and that award
stands. With regard to the 7-acre site the matter has from an early stage been
the subject of some considerable confusion.
It always has
been common ground that in 1977 instructions were given by the defendants to
the plaintiff to proceed with a claim for compensation in respect of that site.
The defendants’ evidence was that throughout they expected that the plaintiff
would be paid wholly by the county council, but there was no evidence that this
was made known to the plaintiff. The plaintiff certainly was aware that he
would get some contribution in respect of his fees included in the
compensation, whatever it was, that he succeeded in negotiating with the local
authority. But again it is clear that at the time in 1977 no mention was made
of the level of fees or the basis of remuneration. Thereafter the plaintiff did
a deal on the work. He secured an increase of the compensation offered from
£58,000 to £126,000, and he proceeded towards this final figure notwithstanding
that solicitors who had been engaged to advance the claim had advised that
£58,000 was a proper figure and that no further action should be taken. But Mr
Jones, rightly in my view, points out that the success or otherwise of the
plaintiff’s effort cannot affect in any way the question of what was agreed
between the parties in the beginning.
The claim as
presented on the writ was a simple claim for the balance of remuneration in
respect of work done at the request of the defendants. The plea in response to
that so far as the 7-acre plot was concerned is contained in the defendants’
defence, para 8, which is in these terms:
As to the
Plaintiff’s claim for £3,827.20, it is admitted that the first Defendant
instructed the Plaintiff to negotiate with the Gwent County Council in relation
to the acquisition of land for the Risca/Rogerstone bypass under the compulsory
purchase orders 1980 and 1983, insofar as same related to the first Defendant’s
land, and the following were express and/or implied terms of the said
agreement:
(a) That as the Gwent County Council had
undertaken to pay the first Defendant’s Surveyors fees, the Plaintiff would
charge only such sum as was to be paid by the said Gwent County Council to the
First Defendant in respect of the first Defendant’s surveyors fees.
(b) That no further sum would be paid or payable
by the first Defendant to the Plaintiff in respect of any such work done in
relation to the said compulsory purchase orders.
The reference
to an express term was subsequently struck out of the pleading by order. The
defendants were asked for particulars of the facts and matters relied upon in
support of the allegation of implied term, and their answer was as follows:
The terms were
implied by reason of the fact that all correspondence and dealings between the
Plaintiff and the First Defendant had indicated that the First Defendant’s
Surveyor’s fees would be paid by the Gwent County Council as is the practice in
such matters and at no time did the Plaintiff ever give any indication that any
additional charge would be made by the Plaintiff for the work carried out on
the First Defendant’s behalf.
The terms as
pleaded by the defendants are in many ways remarkable, because it appears that
they sought to contend that what the plaintiff had done was to bind himself to
accept whatever the Gwent County Council chose to include in the figure for
compensation with no right whatever to take any action in respect of it,
notwithstanding that it might on its face be quite clearly inadequate. The
plaintiff himself would have no direct claim against the county council and, on
the defendants’ view, he could have no claim against the defendants either. It
is therefore on its face a remarkable implied term to suggest.
In support of
it, the reference to the correspondence and dealings between the plaintiff and
the first defendant could not be made out. The documents to which we were
referred contain no hint whatever that that was to be the position as between
the plaintiff and the defendants or, indeed, as between the defendants and the
county council. But it is true that the practice in such matters has for a long
time been that the surveyor’s fees in respect of the negotiation of
compensation, including the preparation and presentation and prosecution of the
claim, should be included as an item in compensation properly to be awarded
under a claim for compensation for compulsory purchase.
The statutory
history behind it is somewhat complicated and need not be set out, for it is
sufficient to refer to a statement of Lord Denning in Lee v Minister
of Transport [1966] 1 QB 111 in which he says this (at p 119):
In an
ordinary case of compulsory acquisition, it has been the practice for many
years for the owner to receive as compensation not only the value of the land,
but also the fees which he has to pay to his surveyor to prepare the claim: and
this practice has been recognised by the courts.
There was,
therefore, an existing practice that the owner’s claim to compensation could
and should properly include a claim in respect of surveyor’s fees. But that is
a claim by way of reimbursement of whatever the fees are which the owner of the
land has to pay to the surveyor.
The matter
proceeded at the trial on a different basis to that which the pleadings might
have suggested. It is pointed out by Mr Jones on behalf of the defendants that
there are matters in the evidence which go to indicate that in 1979, and indeed
perhaps thereafter, the plaintiff appears to have recognised that he would not
be entitled to anything in respect of his work other than what emerged by way
of compensation from the local authority, the principal matters relied on being
that he gave evidence that when the question of planning permission with regard
to the 3-acre site arose the plaintiff specifically said to the defendant that
that would of course involve extra fees. The second matter is that when
solicitors were engaged in regard to the claim for compensation and he was
asked whether the solicitors would have their fees paid by the local authority,
his reply was in the affirmative.
However, so
far as the evidence of what happened at the time is concerned, it is remarkably
sparse. I refer only to one or two passages, and I do so in advance of going to
the judgment for reasons which will hereafter appear. At p 57 the plaintiff
said:
I was working
on basis from the start that Council would be liable for contribution to my
fees.
At p 60 the
first defendant said this:
I rang the
Plaintiff to ask if he’d act for me on this scheme. We didn’t know if 3 acre
parcel would be involved until 3 or 4 years. Originally it was re 7 acre parcel
including farmbuildings. We thought County Council would pay all our legal and
solicitors’ fees and costs. To include surveyor’s costs. Leaflet said whatever
fees you incurred would be paid by local authority.
The leaflet
referred to was never produced, and therefore the evidence that it had said
that whatever fees were incurred would be paid by the local authority can do no
more than to explain what was in the defendant’s mind. That the leaflet should
actually have said that appears to me to be something which it would be
impossible to accept. The local authority would be extremely unlikely to commit
itself to paying whatever fees a claimant chose to incur with his surveyors,
which might be very expensive indeed. But there is no doubt that that is what
the defendants thought at the time.
The plaintiff
appears to have thought that it would be a contribution that he would be
getting, and nobody mentioned anything more. On that basis, and on the basis of
the pleading, it is submitted on behalf of the appellant that since it is
common ground
instructions, and since it is common ground that he was to be remunerated, he
is entitled as against the defendants to reasonable remuneration for the work
done, and, so submits Mr Cooke, it would be for the defendants to displace that
position and establish that there were the implied terms relied upon by the
defendants. That submission clearly has considerable force.
When one goes
to the judgment of the learned judge, one finds this at p 42:
Mr Harris
consulted Mr Francis about the 7-acre site in 1977. He said to me ‘we thought
the county council would pay all the surveyor’s fees. When I spoke to Mr
Francis nothing was said about us paying any part of his fees at all’ It is
right that this matter was never put to Mr Francis in cross-examination.
Then at p 43
the learned judge said this:
This has not
been an easy issue to decide. However, I have to recall where the burden of
proof lies and I am not satisfied that there was any general agreement that
extra fees would be payable in respect of both the 7-acre and the 3-acre site.
I prefer the defendants’ evidence on this point. I am perfectly satisfied that
at the time of the initial discussion both parties were aware of the district
valuer’s obligation to pay the surveyors’ fees and all parties proceeded on
that basis. The plaintiff is not a dishonest man but his recollection is not to
be relied upon. I do not think the parties came to an express agreement
regarding fees for the 7-acre site. I believe that the parties worked on the
common basis of what has been called Ryde’s Scale.
The reference
to ‘Ryde’s Scale’ is a reference to the evidence of the plaintiff which appears
at p 54 of the notes of evidence and relates to an occasion in 1980 or 1981,
long after the initial instructions had been given, when the plaintiff was
asked to deal with compensation in respect of boreholes. The plaintiff’s
evidence with regard to that was this:
I simply
looked at boreholes. Elementary job accepted on basis that Gwent County Council
pay on basis of Ryde’s Scale: scale of fees laid down by Chief Valuation
Officer.
On basis of
scale, Gwent Council Council paid me.
It wasn’t
basis of discussions.
Probably it
was in existence prior to 1980.
Ryde’s Scale
are not mandatory on surveyors.
Then he pointed
out that in para 1.2 of Ryde’s Scale exceptional cases were referred to.
That is the
way in which Ryde’s Scale came into the proceedings. It was not mentioned by
either party in their pleadings, and no doubt it would not have been mentioned
in evidence had Mr Francis not chosen to refer to it.
The learned
judge came to conclusions for which he may well be excused in asmuch as the
case was not presented on the basis of the pleadings by either side. He came to
a conclusion which was vital, that he was satisfied that at the time of the
initial discussion both parties were aware of the district valuer’s obligation
to pay the surveyor’s fee, and all parties proceeded on that basis. He also
came to the conclusion that the parties worked on the common basis of what has
been called ‘Ryde’s Scale’.
In my view, to
have reached that conclusion when the matter had not been ventilated in
cross-examination at all and Mr Francis had not been given a proper opportunity
to deal with it, renders the judgment unsustainable. If, moreover, he was to be
remunerated on the basis of Ryde’s Scale and the remuneration was to come
through the compensation which was to be paid to the defendants, it would, as
it seems to me, be necessary to examine Ryde’s Scale and to compare it with the
work which had in fact been done by the plaintiff. None of this occurred, and
in my view the judgment, therefore, cannot stand. But I am not satisfied that
it would be possible for this court even to go so far as to hold that as
between the plaintiff and the defendants the plaintiff was entitled to be
remunerated on the basis of reasonable remuneration and send it back to the
court to assess what that reasonable remuneration should be. The truth of the
matter is that this trial proceeded on a basis which had arisen at the last
moment out of observations which were made in the evidence. The pleadings
appear to have been largely, if not wholly, ignored, and a finding was made
against the plaintiff in the absence, as it seems to me, of evidence which
could possibly have justified that finding. It would be impossible for this
court, without having seen the witnesses and seen them properly cross-examined
on the matters which were really relevant, to substitute a finding of its own.
Therefore, with the greatest possible reluctance, I reach the conclusion that
we have no alternative but to set the judgment aside in so far as it rejects
the claim for the 7-acre site and to direct a new trial with regard to that
claim. It would clearly be of immense advantage to both parties (the amount in
issue not being very great, since £1,297-odd has already been paid towards the
claim by the county council) if the parties were able to settle their
differences rather than incur the costs of a new trial, which might be very
considerable because it would be necessary to go into matters in much greater
detail than were gone into on the original trial. That, however, is a matter
for the parties.
I would allow
this appeal and make the order which I have indicated.
Agreeing,
NICHOLLS LJ said: I add a few words only because we are differing from the
learned judge. That there should have to be a retrial in this action is most
unfortunate, but I, too, can see no escape from that conclusion. I, too, do not
think that on the evidence before the judge his finding of fact on a crucial
point can stand, namely that the parties worked on the common basis of what has
been called ‘Ryde’s Scale’, if thereby the judge meant — and I think thereby he
did mean — that the plaintiff would not be entitled to be paid for his work
concerning the 7-acre site any more than the scale fees prescribed by Ryde’s
Scale.
It is common
ground that there was no express discussion on this point between the parties.
Whether payment on this scale, as the scale which the acquiring authority would
follow when assessing the amount to be reimbursed to the defendants in respect
of valuation expenses, was implicit was a matter not put at all to the
plaintiff in cross-examination. That being so, I do not think the learned
judge’s conclusion on this point can be allowed to stand.
But that does
not enable or entitle this court to substitute its own views on what were the
parties’ intentions on the question of remuneration. That is a matter which in
this case requires assessment of the credibility of witnesses. That can only be
done by a fact-finding tribunal which has seen the witnesses.
Accordingly,
in my view, there will inevitably have to be a retrial. I also, therefore,
would allow this appeal.
The appeal
was allowed; costs below were reserved to trial judge; costs of appeal to be
costs in cause; retrial to be before another judge of the Cardiff County Court.
