Compensation for electricity lines — Statutory basis of compensation — Whether Land Compensation Acts 1961–1973 apply — Certificate of lawful use — Term of wayleave
The reference
land, a 14ha site, was used between 1946 and 1984 as an agricultural research
centre. The claimant acquired it in 1992. In February 1957 the Minister of
Power granted consent for the placing of two towers and 423m of double-circuit
overhead electricity transmission line across the land. The line was erected in
1959 following the grant of two voluntary wayleaves. In September 1995 the
local planning authority issued certificates of lawful use under section 191 of
the Town and Country Planning Act 1990 in respect of certain agricultural
research and other uses. In November 1995 the claimant gave notice terminating
the wayleave agreements. Following a hearing, the Secretary of State for Trade
and Industry granted a necessary wayleave, dated August 27 1996, authorising
the respondent authority to keep an electric line installed on the reference
land subject to a condition that the wayleave shall remain in force until
determined by either party after the expiration of 15 years. The pylons were
nearly 42m in height, enclosing areas of approximately 66 and 104m2
respectively. The claimant sought compensation of £10,735,920 under para 7 of
Schedule 4 to the Electricity Act 1989; the compensating authority offered
£3,431.41.
use relate to the use of the land and do not permit the carrying out of
operations on the land. In any event there was no demand for the reference land
for the use permitted under the certificates, which did not add to the value of
the land. There was no extant planning permission at the valuation date in
August 1996. A certificate of appropriate alternative development could not be
sought as no land was being compulsorily acquired. Compensation is to be
assessed under para 7 of Schedule 4 to the 1989 Act, and not also by specific
reference to the legislation relating to compensation for compulsory purchase.
The Land Compensation Act 1961 (except for sections 2 and 4), the Compulsory
Purchase Act 1965 and the Land Compensation Act 1973 do not apply to the grant
of a necessary wayleave. However, para 7 of Schedule 7 provides for ‘compensation
in respect of the grant’. The fundamental principle of compensation is
equivalence: Horn v Sunderland Corporation [1941] 2 KB 26. The
claimant was entitled to compensation for all the loss (that is not too remote)
that flows from the grant of the necessary wayleave. This includes direct loss
due to the siting of the pylons and line on the land and the indirect loss due
to depreciation in value of the reference land that is not under the pylons and
line. Compensation for the necessary wayleave is to be assessed on the
assumption that it will be terminated by notice at the end of the 15th year.
The following
cases are referred to in this report:
Abbey
Homesteads Group Ltd v Secretary of State for
Transport [1982] 2 EGLR 198; [1982] EGD 795; (1982) 263 EG 983, 1095,
(1982) 264 EG 59, 151, LT
Broxbourne
Borough Council v Secretary of State for the
Environment [1980] QB 1; [1979] 2 WLR 846; [1979] 2 All ER 13; (1978) 77
LGR 381; 38 P&CR 381; [1979] 1 EGLR 149; 249 EG 959; [1979] JPL 308
Camrose
(Viscount) v Basingstoke Corporation [1966]
1 WLR 1100; [1966] 3 All ER 161; (1966) 64 LGR 337, CA
Clouds
Estate Trustees v Southern Electricity Board
[1983] 2 EGLR 186; (1983) 268 EG 367, 451; 23 RVR 184, LT
Colac v Summerfield [1893] AC 187; [1891–1894] All ER Rep Ext
1655, PC
Cynon
Valley Borough Council v Secretary of State for
Wales (1986) 85 LGR 36; 53 P&CR 68; [1986] 2 EGLR 191; 280 EG 195;
[1986] JPL 760, CA
Durham
County Council v Secretary of State for the
Environment (1989) 60 P&CR 507; [1990] 1 PLR 103; [1990] JPL 280, CA
Horn v Sunderland Corporation [1941] 2 KB 26; [1941] 1 All ER
480; 39 LGR 367, CA
Naylor v Southern Electricity Board [1996] 1 EGLR 195; [1996] 26 EG
138
Padfield v Eastern Electricity Board (1971) 24 P&CR 423, LT
R v Brown (1867) LR 2 QB 630
Turris
Investments Ltd v Central Electricity Generating
Board [1981] 1 EGLR 186; [1981] EGD 549; (1981) 258 EG 1303, LT
West
Midlands Joint Electricity Authority v Pitt
[1932] 2 KB 1
West
Midlands Probation Committee v Secretary of
State for the Environment (1997) Sol J August 8 1997
Williamson
and Stevens (Executors of Walter Williamson (Dec’d)) v Cambridgeshire County Council (1977) 34 P&CR 117;
[1977] 1 EGLR 165; 242 EG 369; [1977] JPL 529, LT
Wipperman v Barking London Borough Council (1965) 64 LGR 97; 17
P&CR 225; [1965] EGD 350; 196 EG 695, DC
Young v Secretary of State for the Environment [1983] 2 AC 662;
[1983] 3 WLR 382; [1983] 2 All ER 1105; (1983) 81 LGR 779; 47 P&CR 165;
[1984] 1 EGLR 166; [1984] EGD 1030; 269 EG 219, HL
The claimant
appeared in person; George Bartlett QC (instructed by Hammond Suddards, of
Leeds) represented the compensating authority.
Giving his
decision, MR PH CLARKE said: This is a reference to determine the
compensation payable for the grant of a necessary wayleave to keep an electric
line installed over land at Stoke Mandeville, Buckinghamshire.
The claimant,
Mr Alastair HR Macleod, appeared in person except for closing submissions where
he was represented by Mr David Cooper, solicitor. Mr Macleod called Mr Michael
GA Hope BSc FRICS ASVA, Mr Donald
D McLeod BSc ARICS and Mr John CP Lyall Dip TP
MRTPI MIMgt. Mr George Bartlett QC appeared for the compensating
authority, National Grid Co plc, and called Mr Malcolm C Judd BSc FRICS ACIArb, Mr John D Moody FRICS and Mr
Barry C Carey BSc FRICS ACIArb.
Facts
The parties
have prepared a statement of agreed facts and from this statement and the
evidence I find the following facts:
1. The
reference land is situated at North Lee, approximately 1 mile south of Stoke
Mandeville, Buckinghamshire. The north-eastern part of the site is within the
area of Aylesbury Vale District Council and the remainder is within that of
Wycombe District Council.
2. The
reference land is an irregular shaped plot of about 14ha (34.5 acres) bounded
on the east and north-east by Risborough Road (A4010 Aylesbury to High Wycombe)
and on the southern side by North Lee Lane. To the north, north-west and west
the site is bounded by a goat farm, agricultural land and housing fronting the
two roads. The land is generally flat with a slight slope in the south-western
corner to North Lee Lane. The character of the surrounding locality is of
attractive countryside with mixed farming interspersed with woodland and
hedgerows, isolated buildings and small groups of houses, and some ribbon
development between Stoke Mandeville and Wendover.
3. The
reference land was formerly occupied by British Oil & Cake Mills Ltd (BOCM)
as an agricultural research centre. It contains concrete roads and paths,
concrete bases and hardstandings (likely to have been the sites of, or
ancillary to, former buildings now demolished) and buildings with an agreed
total floor area of 6,591.76m2. These buildings are single storey
and generally have an agricultural appearance, reflecting the former use of the
land. They have been largely vacant since 1984 and are generally in poor
condition. The remainder of the site is open grassland. There are a number of
mature trees on the site, principally around the central group of buildings.
The overall appearance is of open grassland with low agricultural-type
buildings, now in a dilapidated condition, mainly in a group around the main
access road on the site from Risborough Road.
4. Between
1946 and 1984 the reference land was owned by BOCM and used as an agricultural
research centre and farm demonstration site, mainly for trials, assessments and
recording of animal feedstuffs, with some breeding of pigs, poultry and rabbits
and the pathological investigation of animals. Most of the buildings were erected
during this period.
5. In 1984
BOCM sold the land to Frostbuild Ltd, who tried unsuccessfully to obtain
planning permission for various forms of development: see para 15(i)–(iii)
below.
6. The
claimant in this reference acquired the reference land in July 1992. In 1993 he
held the Chiltern Show Festival on the site, but it has not otherwise been
materially occupied or used. He put the property on the market through Henry
Butcher in October 1993.
7. On February
14 1957 the Minister of Power granted consent for the placing of two steel
lattice towers on the reference land, plus 432m of double-circuit overhead
electricity transmission line across the land. The line was erected in 1959
following the grant to Central Electricity Authority of two voluntary wayleaves
dated March 5 and 13 1957 by BOCM and Beatrice Nicol respectively. Consent to
uprate the line from 275 to 400kV was granted by the Minister of Power on
February 9 1966.
8. Between
1958 and 1963 various agreements were signed with Eastern Electricity Board for
a 33kV line that crosses the reference land from east to west, partly overhead
and partly underground.
9. On
September 15 1995 the claimant wrote to National Grid (the authority) stating
that, as there had been no reduction in the noise from the 400kV line referred
to in para 7 above (about which he had made an earlier complaint), he
terminated both wayleave agreements and requested the authority to remove the
line. Meetings, telephone conversations and correspondence then took place
between Mr Macleod and the authority, but did not result in agreement. The
claimant gave notice of termination of the wayleave agreements through his
solicitors on November 9 1995.
10. On
December 11 1995 the authority made an application to the Department of Trade
and Industry under para 6 of Schedule 4 to the Electricity Act 1989 (the 1989
Act) for the grant of a necessary wayleave to keep the line across the
reference land. Following a hearing the Secretary of State for Trade and
Industry granted a necessary wayleave dated August 27 1996 authorising the
authority to keep an electric line installed over the reference land subject to
the condition that ‘the wayleave shall remain in force until determined by
either party giving to the other at any time after the expiration of 15 years
from the date of this necessary wayleave six months previous notice in writing
… subject to the rights of The National Grid Company plc under Schedule 4 to
the 1989 Act’.
11. The
electric line authorised by the above necessary wayleave enters the reference
land in the south-eastern corner and runs first in a westerly direction to a
pylon or tower (ZL 400) sited a short distance from the eastern boundary of the
reference land. The line then changes direction and runs in a west-north-west direction
to a second pylon (ZL 399) situated close to the north-western boundary of the
reference land and then runs off the land in the same direction. In general
terms the line bisects the reference land from east to west so that about
two-thirds of the site is to the north of the line and one-third to the south.
12. Both
pylons are of lattice steel construction. Pylon ZL 399 is a suspension tower
with a height of 41.605m. The maximum dimensions at the base are 8.1m by 8.1m
enclosing a site area of 65.61m2. The maximum width of the power
line (conductor) at this pylon is 13.9m and the height to the bottom cross-arm
is 23.689m. Pylon ZL 400 is a deviation or angle tower and has a height of
41.834m. The maximum dimensions at the base are 10.2m by 10.2m enclosing a site
area of 104.04m2. The maximum width of the power line at this pylon
is 10.2m and the height to the bottom cross-arm is 19.888m.
13. The
conductors or power line supported by the pylons is a 400kV line comprising 12
overhead electrical conductors and one earth wire with insulators and fittings.
The minimum height of the conductors at mid-span is 8.6m between the pylons.
The maximum width of the conductors at maximum swing at mid-point between the
pylons is 42m. The length of the line on the reference land is 432m.
14. The
following areas of land are agreed:
(i) under the
pylons, 169.65m2;
(ii) within
the swing of the conductors, 2.7 acres;
(iii) under
the conductors and pylons without the swing, 1.2 acres;
(iv) within
0.5 microteslas, 10.4 acres;
(v) between 0
2 and 0.5 microteslas, 2.7 acres;
(vi) residue
of reference land, 21.4 acres.
15. Planning
permission has been refused for the following development on the reference
land:
(i) New
village comprising highway improvements, housing, restaurant, shopping,
commercial, office and industrial units (refused on appeal February 16 1990).
(ii)
Demolition of existing building and erection of two-storey office (refused by
Aylesbury Vale District Council June 7 1990).
(iii) Golf
driving range, shop and car park (refused by Aylesbury Vale District Council
November 27 1990).
(iv) Open
storage of bottled liquefied petroleum gas (Calor gas cylinders) (refused on
appeal February 20 1996).
16. On
September 12 1995 Aylesbury Vale District Council issued a certificate of
lawful use under section 191 of the Town and Country Planning Act 1990 (the
1990 Act) in respect of the reference land within their area. This certified
that the following use was carried out on the land prior to the date 10 years
before the application:
Use of the
Land for the following composite purpose which constitutes a sui generis
use of the Land and which does not fall within the Town and Country Planning
Use Classes Order 1987: —
–intensive
keeping and breeding of poultry, pigs and rabbits;
–Trials,
assessment and recording of animal feedstuffs, bedding and animal housing;
–Trials of
husbandry and veterinary techniques and practices, including progeny testing
and artificial insemination;
–Pathological
investigation of dead animals;
–The Annual
European Poultry Fair;
–Display of
animal housing, techniques and results of trials to visitors from within and
outside the farming industry.
17. On
September 15 1995 Wycombe District Council issued a certificate of lawful
existing use in identical terms for the remainder of the reference land.
18. On
September 11 1996 the claimant referred the determination of compensation for
the grant of the necessary wayleave to the Lands Tribunal.
19. The
claimant applied to Aylesbury Vale and Wycombe District Councils for
certificates of appropriate alternative development for the reference land
under section 17 of the Land Compensation Act 1961 (the 1961 Act). Both
authorities refused to issue these certificates. Appeals were lodged with the
Department of the Environment, which declined to accept them. Application was
made to this tribunal for leave under section 17(2) of the 1961 Act to apply
for these certificates. The tribunal declined to determine this application on
the grounds that it had no jurisdiction to do so.
20. On January
18 1996 Wycombe District Council made a tree preservation order covering 24
individual trees and nine groups of trees on the reference land. On March 1
1996 Aylesbury Vale District Council made a tree preservation order covering 38
individual trees and three groups of trees on the reference land.
21. The
statutory development plans covering the reference land are:
(i)
Buckinghamshire County Structure Plan 1991–2011, adopted March 1996;
(ii) Aylesbury
Vale (Rural Areas) Local Plan, adopted July 1995;
(iii) Wycombe
District Local Plan, adopted July 1995.
22. The agreed
date of valuation for the assessment of compensation is August 27 1996, the
date of the grant of the necessary wayleave.
Issues
The main issue
in this reference is the amount of compensation payable under para 7 of
Schedule 4 to the 1989 Act for the grant of the necessary wayleave. Mr Macleod
is seeking £10,735,920; the authority offer £3,43l.41. The question for my
determination is: what compensation should be paid, as at August 27 1996, for
the retention of the pylons and the electric line on the reference land under
the necessary wayleave and for any consequent diminution in the value of that
land? Within this general question are several subsidiary questions:
(i) What is
the scope of the certificates of lawful use?
(ii) Were
there planning permissions still in existence in August 1996 authorising the
rebuilding of buildings subsequently demolished or the construction of new
buildings, which were, or would have been, part of the former BOCM agricultural
research centre?
(iii) What
planning permission would have been granted in August 1996 for the development
of the reference land with and without the 400kV power line on the site?
(iv) Is the
compensation for the necessary wayleave to be assessed by reference to para 7
of Schedule 4 to the 1989 Act or also by reference to the legislation relating
to compensation for compulsory purchase?
(v) Did the
certificates of lawful use add to the value of the reference land in August
1996?
(vi) Is
compensation for the necessary wayleave to be assessed on the assumption that
it will continue in perpetuity or that it will be terminated by notice after 15
years?
In addition to
the main issue of compensation the parties disagree as to the method of
calculating interest on that compensation, it being agreed in principle that
interest is payable on the compensation awarded.
Advance
compensation
Before dealing
with these issues, however, I must refer briefly to a matter raised by Mr
Macleod on the first day of the hearing. He said that the authority had made an
interim payment of compensation. He did not tell me the amount. He asked me to
make an order requiring the authority to make a further payment of
compensation. He referred to section 52 of the Land Compensation Act 1973 (the
1973 Act) and to the power of the Lands Tribunal under r 32 of the Lands
Tribunal Rules 1996 and section 14 of the Arbitration Act 1950 to make an
interim award. After considering the matter I gave my decision on the fourth
day of the hearing. I declined to make the order requested for the following
reasons.
First, for the
reasons given later in this decision, section 52 of the 1973 Act does not apply
to the assessment of compensation for the grant of a necessary wayleave under
para 7 of Schedule 4 to the 1989 Act. Second, even if section 52 of the 1973
Act applies to this reference, this section contains its own procedure
involving the claimant and the acquiring authority, but not the Lands Tribunal.
It would appear that the tribunal has no jurisdiction to order an advance
payment of compensation. I would add, however, that I heard no submissions on
this point. Third, although the effect of r 32 of the Lands Tribunal Rules 1996
and section 14 of the Arbitration Act 1950 is to give the tribunal power to
make an interim award, this is a discretionary power. A member of the tribunal
may make such an award ‘if he thinks fit’. In the circumstances of this
reference I decline to make an interim award fixing a further sum of
compensation payable to the claimant in advance of my final award of
compensation, which is contained in this decision.
Evidence
Claimant
Michael George
Anthony Hope BSc FRICS ASVA is
the partner in charge of the Manchester office of James Andrew Badger. He gave
evidence on values and compensation.
Mr Hope
assessed the compensation for the necessary wayleave in the sum of £10,735,920,
being the difference between the value of the reference land without the
electric line of £15,525,000 and the value with the line of £4,789,080, both
valuations on an existing use basis. Mr Hope’s valuations are set out in annex
A to this decision.
Mr Hope
referred to the planning position and said that, having considered alternative
uses for the reference land and having been unable to obtain a certificate of
appropriate alternative development, he believed that it is not possible to
provide a reliable alternative use valuation for the land, with or without the
electric line.
Mr Hope said
that the reference land was offered for sale in 1993, but inquiries were
thwarted by the local authorities who said that the site was agricultural. A
research company, Microviral, were interested and, following the grant of the
certificates of lawful use, entered into discussions to buy 20 acres for £9m.
Mr Hope was not directly involved in these negotiations. Microviral expressed
concern regarding the electric line, which they said could affect their
research. Efforts were made to resolve this matter but without success.
Microviral would not disclose their proposed use of the land, but said that it
could be carried on under the certificates of lawful use. Microviral were
willing to take the reference land with those certificates and to use the
existing buildings. In July 1996 a representative of Microviral attended a
meeting between the claimant and the authority. Microviral offered to fund half
the cost of diverting the electric line, but this, and a later increased offer,
were refused by the authority. Microviral have now broken off all
communications with the claimant due to the robust approaches made to them by
the authority. Mr Hope said in cross-examination that he did not rely on the
Microviral offer as evidence of value, but it was a background consideration.
Mr Hope said
that his site value of £450,000 per acre is based on the sales of three
research establishments: Warren Spring, Stevenage (Glaxo); Surrey Research
Park, Guildford; and Oxford Science Park. Mr McLeod gave evidence of Warren
Spring and Oxford Science Park. The Surrey Research Park is not referred to
further in either Mr Hope’s or Mr McLeod’s evidence. Mr Hope said that he did
not rely on Mr McLeod’s other comparables. He also said that Mr McLeod was instructed
independently of his value evidence. A value of £450,000 per acre reflected the
use of the reference land under the certificates of lawful use. Mr Hope
explained that he looked at the comparables and made appropriate deductions to
relate them to the bare site value of the reference land, £500,000 per acre,
which he checked against the Microviral offer of £450,000 per acre.
Mr Hope said
that he found the decisions of this tribunal in Turris Investments Ltd v
Central Electricity Generating Board (1981) 258 EG 1303* and Naylor
v Southern Electricity Board [1996] 26 EG 138† to be of assistance. He
relied on the tribunal’s view that the perception of the disadvantages of
proximity to an electric line may be real even though unwarranted and to the
percentages used to assess injurious affection. Mr Hope said that he has used
the same percentages as the basis of his valuation although there is now a much
greater perception of injurious affection than in 1980.
*Editor’s
note: Also reported at [1981] 1 EGLR 186
†Editor’s
note: Also reported at [1996] 1 EGLR 195
Mr Hope
referred to part of the inspector’s report of the necessary wayleave hearing
and to the evidence given at that hearing by Dr Jeffers, and said that there is
a total loss of land value under the electric line. This should be treated as
compensation for the grant of the necessary wayleave and not as injurious
affection.
Mr Hope said
that the electric line could throw doubt on research results. This will affect
the interest in the site. All the percentage calculations in his valuations
relate to perceived or real concerns about tissue damage, health risks and the
potential for equipment malfunction created by the electric line.
Mr Hope then
considered the value of the reference land as an animal research centre without
the line. He referred to their scarcity and said that he has valued the
reference land on the basis of the comparables, negotiations, the certificates
of lawful use and the existing buildings and extant planning permissions of
some 19,500m2, and applied a value of £450,000 per acre. Value for
alternative use or development would not exceed this amount. Mr Hope said that
he could not be specific regarding the buildings covered by extant planning
permissions: it would be a matter for discussion with the local authorities.
The possibility of rebuilding demolished buildings was a factor in the
background to his valuations. Mr Hope reduced his value relative to the
comparables to reflect the condition of the buildings on the reference land
that need rebuilding or refurbishment to provide a modern animal research
facility. A substantial fortified fence will also be needed.
Mr Hope then
considered the value of the reference land for animal research with the
electric line in position. He said that research into the effects of electric
lines suggests the possibility of health risks and cellular tissue damage as a
result of living or working close to power lines. This reduces the value of
properties affected by such lines. The inability of National Grid or anyone
else to provide definitive confirmation that there are no dangers associated
with electric lines has obliterated the considerable value of the reference
land for its lawful use. He referred to the evidence given by Dr Dennis, on
behalf of the claimant, at the necessary wayleave hearing. It would be
imprudent to use the whole of the reference land for animal research.
Mr Hope said
that the general background level of magnetic field forces is 0.2 microteslas
and this suggests that an area of between 60 and 100m on either side of the
pylons should be avoided. Between 0.2 and 0.5 microteslas the risk of danger is
statistically low, although it could be relevant and is best avoided. Mr Hope said
that he has allowed a smaller reduction in value for these parts of the land
than for the parts affected by more than 0.5 microteslas. Mr Hope said that
about 3,718m2 (38,770 sq ft) of buildings on the reference land, or
which enjoy extant planning permissions, are within the 0.2 microtesla line.
Planning difficulties make it difficult to obtain planning permission to
reconstruct these buildings on those parts of the site outside the zone in
which the effect of the electric line is above 0.2 microteslas. However, it is
only in the area outside 0.2 microteslas that the buildings could be considered
not to suffer adverse health effects from the line.
Having regard
to the existing planning position, Mr Hope said that any redevelopment of the
reference land would be restricted to about 7,100m2 (75,000 sq ft),
of which some 1,900m2 (20,000 sq ft) are located on the eastern edge
of the site, separated by the electric line. Planning restrictions and the line
therefore reduce to half the buildings and existing consents that could be
considered as having potential for redevelopment. Mr Hope said that with
careful planning it may be possible for some animal research to be carried out
on the fringes of the reference land, but there would be difficulties.
Mr Hope said that
National Grid accepted at the necessary wayleave hearing that there is a
reduction in the value of land affected by electric lines and this is further
supported by the amendment to the RICS Appraisal and Valuation Manual
issued in June 1996. Mr Hope referred to the reductions in value set out in
part 2 of his valuation (annex A to this decision).
Mr Hope’s
conclusion was that there are fears or perceptions of health risk related to
electric lines that affect the value of property. In relation to the reference
land the factors depreciating value are: the area of land taken for the pylons
and the line; the effect on adjoining lands due to perception of health risk
and tissue damage; the visual intrusion by the line; noise of Corona discharge;
fears of equipment malfunction and radio and television interference; fears of
cable breakage; and interruption due to National Grid access rights.
Donald David
McLeod bsc arics is a partner in the Glasgow
office of Douglas Inglis & Partners, chartered surveyors. In January 1997
he was instructed by the claimant to investigate the market for research centre
uses, with specific reference to animal research.
Mr McLeod was
essentially a witness of fact. At the hearing the claimant withdrew some of Mr
McLeod’s written evidence, and it was restricted to the following five
properties:
(i) Brockham
Park, Surrey — Formerly the headquarters of the Pharmaceutical Research
Division of the Beecham Group. Site area of 33 acres (13.5 ha) with 166,420 sq
ft (15,461 m2) of laboratories, offices, ancillary accommodation,
stores and restaurants. The majority of the buildings have a lawful use within
class B1 of the Town and Country Planning (Use Classes) Order 1987.
Redevelopment for B1 use may be permitted or for a mixed scheme involving the
conversion of Brockham House to residential use or for a residential scheme.
Sold in mid-1997 for a figure ‘well in excess’ of £6.5m or for which a sale
price of £7.5m is anticipated. Mr McLeod said that he included this property in
his evidence to show how planning permission would be obtained for the
reference land.
(ii) Oxford
Science Park — Market information suggests that, at the height of the
market in 1990, land deals on this property achieved £1m per acre.
(iii) Warren
Spring, Stevenage — Former environmental laboratory owned by the Department
of Trade and Industry and sold in about March 1992 to Glaxo, for a reported
price of £25m, for development as a new research campus. The land use
designation/use class is research and development, laboratories, studios, high
tech/class B1, 18-acre site.
(iv) Former
Grassland Research Institute, Hurley, Berkshire — Formerly occupied by the
Institute of Grassland & Environment Research. 20 acres with 80,000 sq ft
of buildings. Outline planning permission granted in January 1996 for
demolition of existing buildings and erection of 8,346m2 of B1
buildings with access car parking and landscaping. Sold to Scottish Amicable in
July 1995 for £8.705m. Mr McLeod said that this property is similar to the
reference land and indicates how planning permission may be obtained for
comprehensive redevelopment. This is also a good comparable for the value of
land with planning permission for B1 development. Mr McLeod said that the value
of this land is in the site, not the buildings. The sale price represents
£435,000 per acre.
(v) Cambridge
Science Park — 22.46-acre site adjacent to Cambridge Science Park, marketed
in July 1997 at a sale price of about £500,000 per acre. Planning permission
for B1 development.
John Campbell
Paterson Lyall dip tp mrtpi mimgt was formerly a principal
planning officer and then deputy director of planning and development of
Monklands District Council in Scotland. He was instructed by the claimant in
May 1997 to give evidence of planning. In cross-examination Mr Lyall said that
he had spent the whole of his professional life in Scotland. He prepared his
evidence after reading Mr Hope’s proof of evidence. Mr Lyall’s evidence is on
the
no-pylon world).
Mr Lyall said
that some of the planning issues have been eased by the grant of the
certificates of lawful use. The local authorities have agreed in correspondence
that the existing buildings on the reference land could be used for the
purposes stated in the certificate. In addition, buildings totalling 14,126m2
have been demolished and the claimant has been advised that planning
permissions relating to these buildings are still extant. These buildings could
be rebuilt without the necessity for further permissions. Mr Lyall said that he
has identified the plinths of previous buildings totalling 5,537m2
and National Grid have identified 3,962m2. An estimated 24,000m2
of roads, hardstandings and other infrastructure are on the reference land. The
claimant has identified 11,000m2 on the ground and National Grid
have identified 3,962m2.
Mr Lyall
referred to the relevant planning policies in the development plans. He
emphasised that the local plans were adopted prior to the issue of the
certificates of lawful use. Policy OC3 in the structure plan sets out the
conditions for the reuse or redevelopment of major existing developed sites in
the open countryside. Mr Lyall conceded in cross-examination that this policy
does not apply to the reference land, due to the lack of identification of the
land as within the policy in the local plans. Mr Lyall referred to the tree
preservation orders on the reference land and emphasised that they were made
after the issue of the certificates of lawful use.
Mr Lyall said
that the existing buildings on the reference land could be brought back into
use in accordance with the certificates of lawful use. Planning permission
would not be required to repair these buildings. New regulations may, however,
require works to be carried out that affect the external appearance and
planning permission may then be required. Various policies in the local plans
set out conditions for the use of redundant buildings in the countryside, but
these are generally directed to isolated buildings and not to groups of
buildings, as on the reference land. Furthermore, these policies mainly concern
reuse for a different purpose, which is not the position here. Thus, the extent
of the existing buildings constitutes a material fact that must be taken into
account when considering an application for planning permission for the
redevelopment of the reference land. There would be no intention to alter the
use of the buildings and the only real issue to be considered therefore would
be the design of the modernised buildings, which could be made acceptable in a
countryside setting. In Mr Lyall’s view, planning permission would be granted
for the modernisation of the existing buildings on the reference land.
Mr Lyall said
that about 14,126m2 of buildings have been erected on the reference
land with planning permission and subsequently demolished; 8,589m2
cannot be identified. Legal advice suggests that these permissions are still
extant. These buildings could be rebuilt under the extant permissions.
Modernisation would be needed. Planning permission would be required, but it
would lead to an improvement in the countryside in line with development
policy. Planning permission would be forthcoming. Thus, subject to agreement
with the local authorities, and in the no-pylon world, it would be possible to
either rebuild and modernise 20,717m2 of buildings or modernise
6,591m2 of existing buildings on the reference land.
Mr Lyall then
referred to the claimant’s unsuccessful efforts to obtain certificates of
appropriate alternative development for B1 and/or residential use on the
reference land. In their absence it is necessary to consider what certificates
might have been issued, that is to say what alternative development might have
been permitted on the reference land in the absence of the electric line.
First, Mr
Lyall considered the possibility of nil certificates. He said that it must be
questioned whether the electric line must cross the reference land. Two
alternative routes were considered at the necessary wayleave hearing and,
because such other routes are available, nil certificates of appropriate
alternative development would not be appropriate. From discussions with the
local planning authorities it would appear that they would refuse planning
permission for B1 and residential development. There are, however, other
material considerations to be taken into account. Furthermore, a local planning
authority may not give a negative certificate solely on the grounds of policy.
Mr Lyall referred
to the existing buildings (6,591m2) and buildings permitted under
extant planning permissions (14,126m2) and said that 20,717m2
of buildings on the reference land are a material consideration when
considering alternative development. He considered policy OC3 in the
Buckinghamshire Structure Plan and the inspector’s report in the Calor gas
inquiry (para 15(iv) of the facts). The local plans covering the reference land
were adopted before the certificates of lawful use were issued. He concluded
that B1 development on the reference land (which includes research and
development) must be considered relative to the use permitted under the
certificates of lawful use. It would not be more detrimental than the lawful
use, and he therefore accepted B1 as an appropriate alternative use of the land
up to 6,591m2. In addition, residential development would be
permitted, having regard to existing nearby housing and the need for additional
private housing in the area. Up to 30 houses would be acceptable. They would have
a total floor area substantially less than the 14,126m2 of
floorspace allowed under the extant planning permissions. The remainder of the
site would be returned to agriculture, forestry or some other appropriate use.
Mr Lyall produced a development plan of the reference land showing the siting
of the proposed B1 and residential development referred to above.
Mr Lyall
referred to Mr McLeod’s evidence regarding Brockham Park and Hurley. At Hurley
the planning policies relating to development were less favourable than at the
reference land. At Brockham Park B1 or other alternative uses may be permitted.
National
Grid
Malcolm
Charles Judd BSc FRICS ACIArb is
a founding partner of Malcolm Judd & Partners, chartered surveyors, town
planners and development consultants, with offices at Blackheath and elsewhere.
Mr Judd gave evidence regarding planning.
Mr Judd
referred to the relevant policies in the development plans and his
correspondence with the local planning authorities and said that the starting
point when considering the potential development of the reference land is the
certificates of lawful use. These apply to the existing buildings. New
buildings would require planning permission. Maintenance and repair of the
existing buildings would require planning permission if the works materially
alter the external appearance.
Mr Judd
referred to the letters to Mr Hope from Wycombe District Council, dated
February 15 1995 and February 6 1996, regarding the development of the
reference land. In the first letter the council state that existing policies
‘would militate against any redevelopment proposals … that were not required in
the interests of agriculture or forestry or some other use appropriate to its
location in open countryside’. In the second letter the council state that
acceptable uses for the land are: the use in the certificates of lawful use;
agriculture or forestry; and a use within policy C6 of the local plan, ie
certain limited forms of development in the open countryside. Mr Judd then
referred to his correspondence with the local planning authorities as to
permitted development and said that their response was consistent with the
previous letters to Mr Hope. Mr Judd drew attention to part of the letter of
February 15 1995 to Mr Hope, which states that an applicant seeking to reuse
the existing buildings must demonstrate that they are capable of reuse. This
requirement arises out of para 3.26 of policy C8 in Wycombe Local Plan, which
requires that buildings shall have a long life with normal maintenance. He also
drew attention to PPG 7. Aylesbury Vale (Rural Areas) Local Plan, policy RC20
includes the criteria for the conversion of a non-traditional building in the
countryside to an alternative use, that the building shall not require
recladding or reconstruction. Mr Judd said that many of the buildings on the
reference land would fail to meet these planning requirements. Reuse of these
buildings would be difficult to achieve. Mr Judd referred to the need to limit
development to that which is in accordance
(see sections 54A and 70(2) of the 1990 Act and PPG 1). With regard to the
alleged extant planning permissions, Mr Judd said that the local planning
authorities know of no such permissions.
Mr Judd
analysed the planning position in order to consider what planning permission
might be granted for redevelopment. He referred to the decision letter dated
February 16 1990 in the new village appeal and the inspector’s report dated
February 20 1996 in the Calor gas appeal (para 15(i) and (iv) of the facts) and
said that the reference land is not a major existing developed site in the open
countryside which satisfies the requirements of policy OC3 in the structure
plan. In particular, the land has not been identified as such a site in the
local plan. In a letter to Mr Judd dated February 5 1997, Aylesbury Vale
District Council confirm that it is not a major development site within policy
RC6 of the local plan and would not be considered under policy OC3 of the
structure plan.
Although the
reference land does not fall within policy OC3, Mr Judd said that he requested
the advice of the local authorities as to whether they would permit
redevelopment for an animal research centre. In their letter of February 5 1997
Aylesbury Vale District Council state that ‘it is most unlikely that planning
permission would be forthcoming’ for this development.
Mr Judd said
that, in the absence of such redevelopment, consideration should be given to
the way in which the reference land could be returned to mainly open
countryside. He has prepared a pragmatic development scheme using costings by
Mr Moody and valuations by Mr Carey. The scheme is based on an approach which
would make the minimum impact on visual and residential amenity, return the
majority of the land to agriculture, retain the trees, improve access from the
A4010, retain the employment aspects of the site, make a minimum impact on
services and constitute sustainable development. This pragmatic scheme provides
for:
(i) removal of
all buildings, hardstandings and roads and closure of all entrances to the land
(other than the main entrance and public footpaths);
(ii)
protection of trees;
(iii)
regrading and filtering of soil where buildings and hardstandings etc have been
removed to return these sites to good agricultural quality;
(iv)
construction of two houses on North Lee Lane, south-east of Cedar House;
(v)
construction of up to 1,000m2 of residential character B1 offices
with parking, to be sited north-west of the existing main entrance road;
(vi)
improvement of the main entrance from Risborough Road;
(vii) transfer
of land at the southern end of the reference land to Cedar House and
Thurlstone; and
(viii)
provision of agricultural access.
Mr Judd said
that he has considered the specific limitations of the reference land and its
characteristics. For the residential development there is only frontage
development along North Lee Lane, and the generous plots allocated to the
proposed two houses would allow them to be readily integrated into the
immediately surrounding development. There are numerous protected trees. The
site is necessarily low density and the building of only two houses avoids
overdevelopment and is in accordance with the planning restrictions on
unnecessary development in the countryside. B1 development is restricted to an
amount that would be needed to persuade a developer to undertake regeneration
of the remainder of the reference land. Mr Judd said that planning permission would
not be granted for the re-establishment of an animal research centre with the
substantial rebuilding that would be needed, but, having regard to the
certificates of lawful use, there is a reasonable chance of obtaining planning
permission for the pragmatic scheme described above.
Mr Judd said
that the pylons and line do not influence his conclusions regarding the
planning permission likely to be granted on the reference land. They lie within
the parts of the land that would be farmed under the proposed redevelopment
scheme.
John David
Moody FRICS is a senior building surveyor with JTrevor & Webster, chartered
surveyors, London. He gave detailed evidence regarding the construction and
condition of the buildings on the reference land. He said that generally they
are agricultural buildings with poor foundations and no services. They have not
been maintained for the last 14 years and are in poor repair. He estimated that
the cost of demolishing the existing buildings and returning the land to
agricultural use would be £260,000 exclusive of fees and VAT. Mr Moody said
that the buildings could only be used as an agricultural research centre. Any
other use would be a material change of use under the building regulations. The
buildings would then be required to comply with these regulations. Any other
use would require rebuilding.
Barry
Christopher Carey BSc FRICS ACIArb
is a founding partner of Malcolm Judd & Partners and gave evidence on
valuation and compensation.
He assessed
the compensation payable to the claimant for the necessary wayleave to be
£3,431.41. His valuation is set out in annex B to this decision. Mr Carey drew
attention to the 15-year term of the necessary wayleave. He said that if the
wayleave is terminated on or after the 15th year, then a fresh claim for
compensation may be made. It is therefore incorrect to assess compensation on
the basis of a perpetual wayleave. Mr Carey said that he has had regard to para
7 of Schedule 4 to the 1989 Act, section 5(2) of the 1961 Act and section 10 of
the Compulsory Purchase Act 1965, but not to the planning assumptions under
sections 14 to 16 of the 1961 Act for land injuriously affected. He followed
the basic approach in Turris v Central Electricity Generating Board
and has assessed compensation for the land taken, the necessary wayleave and
injurious affection.
With regard to
the value of the land taken (ie the area enclosed by the footings of the
pylons), Mr Carey said that he first considered the capital value on the basis
of an agricultural value of £3,000 per acre. This produced a total value of
£126 which he apportioned between the 15-year wayleave term (£65) and the
reversion (£61).
Mr Carey
considered next a payment for the grant of the necessary wayleave. In Turris
the tribunal adopted a nominal figure of £100 for a permanent easement for one
pylon. Mr Carey considered that a similar amount is appropriate for the
wayleave at the reference land. However, the sum of the amounts for land taken
(£65) and the wayleave (£100) is less than the compensation payable under the
electricity supply industry agreement referred to below. He therefore rejected
these two amounts in favour of the larger sums calculated in accordance with
this agreement.
Mr Carey said
that for some years an annual agreement has been negotiated between the
electricity supply industry and the farming industry relating to wayleave
compensation. This is known as the ESI agreement. This agreement is not binding
on landowners, but most accept it. Since the formation of National Grid in
1990, only three necessary wayleave hearings have been held and this current
reference is the only case of disputed compensation to be referred to the Lands
Tribunal.
The ESI
agreement contains a table of landowners’ payments by reference to the site
area occupied by the base of a pylon (tower). Mr Carey said that these payments
are sometimes referred to as rent and are intended to compensate the owner for
allowing the electricity company to put and keep equipment on the land. They
cover the towers and line between them. Under the table in force from December
1 1995 the payment for each of the towers on the reference land would have been
£28.57 pa. These amounts are also used as a basis for calculating payments for
permanent easements. These capital payments vary between electricity companies
and are not part of the ESI agreement. The years’ purchase used to capitalise
these annual payments is between 13 and 20, and National Grid use 20 YP,
representing a 5% yield. In this reference the term of the wayleave is 15 years
and Mr Carey therefore capitalised the annual owner’s payments at 10.38 YP (YP
15 years at 5%) to produce a capitalised rent of £593.11. This is higher than
the total figure of £165, representing agricultural value plus a nominal
wayleave payment
Electricity Board (1971) 24 P&CR 423 where the Lands Tribunal applied
the ESI agreement rates: see also Clouds Estate Trustees v Southern
Electricity Board (1983) 23 RVR 184*.
*Editor’s
note: Also reported at [1983] 2 EGLR 186; (1983) 268 EG 367, 451
Mr Carey said
that compensation for injurious affection is based on the depreciation in the
market value of the land affected by the pylons and conductors for a 15-year
period. He considered two alternative bases of valuation: under the
certificates of lawful use, and for redevelopment in accordance with Mr Judd’s
pragmatic development scheme. A prospective purchaser would seek to establish
the planning position and offers for the reference land would depend on the
purchaser’s conclusions as to the likelihood of obtaining planning permission.
Mr Carey said that he has considered the factors that may cause a diminution of
value as set out in Turris. He considered the possible effect of
electromagnetic fields, but said that he found no market, settlement or award
evidence that supports a depreciation in value on this ground. He has not
included in his compensation any element specifically for this factor.
With regard to
the compensation basis under the certificates of lawful use, Mr Carey said that
the reference land and the existing buildings could be used only for
agriculture or agriculturally-based research uses of a low-tech nature. It was
accepted by Professor Dennis, who appeared for the claimant at the necessary
wayleave hearing, that the buildings would not be suitable for modern research.
New buildings would be necessary. Mr Carey said that he could find no evidence
of demand for buildings of this nature for basic research work. Mr Carey
concluded that the uses set out in the certificates of lawful use would not be
restricted to any material extent, if at all, by the pylons and line. The
certificates of lawful use do not enhance the value of the reference land. He
referred to the former use of the land by BOCM. They did not terminate the
wayleaves; they occupied the site for agricultural research with the pylons and
line in place; they constructed a building directly underneath the line. The
pylons and line did not adversely affect their operations nor the value of
their agricultural research establishment on the land.
With regard to
redevelopment under Mr Judd’s pragmatic scheme, two houses, 1,000m2
of B1 development and the restoration of the remainder of the land to
agriculture, Mr Carey said that the agricultural land and the B1 land would not
be affected by the pylons and line. The B1 buildings would be more than 150m
from the line and would be screened from the pylons and line by the buildings
and trees at Longacre and the trees subject to a tree preservation order. The
site of the two houses may be injuriously affected. Having regard to sale
prices of building plots at Wendover, Hillsden, Padbury and Weston Turvill
(£82,000 to £110,000), Mr Carey valued each of the plots on the reference land
at £110,000. Having regard to compensation settlements and awards on four sites
in various locations, which showed injurious affection under the line to be
between 12.5% and 14.14% and on the remainder to be between 1.5% and 14.14%, Mr
Carey said that the maximum depreciation in value of the residential plots
would be 5%, to reflect all the factors which may result from the presence of
the pylons and line. A prospective purchaser of the reference land for the pragmatic
scheme would, however, consider the limited prospects of obtaining planning
permission for this development and would reduce his bid to 30% of residential
site value to reflect the uncertainty surrounding the grant of planning
permission. Thus, injurious affection for the two building plots should be
based on 5% of 30% of the full residential value of £110,000 per plot. This
injurious affection must, however, be related to a 15-year wayleave and the
value of the land at the end of this term must therefore be deducted (£1,587)
to leave a net figure of compensation for injurious affection over the next 15
years of £1,713. In cross-examination Mr Carey said that the line would
restrict building underneath it, but that this would not affect the value of the
land even with a planning permission for comprehensive redevelopment as
proposed by Mr Lyall. Car parks, roads, open space, etc could be sited under or
close to the line.
The third
element of compensation is an occupier’s payment under the ESI agreement. This
is an annual payment, based on the size of the base of the pylons, to
compensate for interference with agricultural operations on the land under the
pragmatic development scheme. The payment for pylon ZL 399 under the agreement
would be £48.23 pa and for pylon ZL 400, £60.18 pa (based on arable rates,
which are higher than grassland). Mr Carey capitalised these payments at 5% for
15 years to produce a capital sum for this element of compensation of
£1,125.30.
In
cross-examination Mr Carey said that he valued the reference land with the
benefit of planning permission for Mr Judd’s pragmatic scheme and subject to
the pylons and line at £513,000. Exclusive of the costs of clearance and
buildings etc of £260,000, the net site value was £253,000. In Mr Carey’s
opinion, this exceeded the value with the benefit of the certificates of lawful
use.
Mr Carey
criticised Mr Hope’s figure of £450,000 per acre for the reference land. He
said that he could not understand his basis. It appears to be based on the
Microviral offer, but this was withdrawn and no weight should be given to it.
It was not a transaction. Mr Carey said that he had been unable to find out
whether Microviral purchased a property or even if they showed an interest in
other possible sites. The Oxford Science Park and Warren Spring comparables are
unreliable. The former is not a transaction, but general market information.
The latter was a special purchase and the site had 624,000 sq ft of floorspace
on it. Mr Hope’s adjustment of this price by two-thirds to relate it to the
reference land shows that this property is not comparable.
Submissions
National
Grid
Mr Bartlett
said that the subject-matter of this reference is a necessary wayleave
terminable after 15 years. Compensation is recoverable under para 7 of Schedule
4 to the 1989 Act. There is no dispute that a lump sum may be awarded. This
must reflect the ability of either party to terminate the wayleave after 15
years. Mr Hope’s valuation does not reflect the terminable nature of the
wayleave; Mr Carey’s valuation is on the correct basis.
Mr Bartlett
said that the Land Compensation Act 1961 does not apply to the assessment of
compensation for a necessary wayleave, except sections 2 and 4: see para 7(4)
of Schedule 4 to the 1989 Act. A wayleave can be granted for a short term and
in return for an annual consideration: see para 7(3) of Schedule 4 to the 1989
Act. Compensation for compulsory purchase envisages the transfer of the whole
of an interest for a lump sum and is inappropriate for the grant of a wayleave.
Furthermore, Schedule 3 to the 1989 Act deals with compulsory acquisition and
is distinct from Schedule 4, which contains the provisions relating to the
acquisition of a wayleave. A wayleave is, however, a right over land and within
the definition of ‘land’ in section 39(1) of the 1961 Act: see West Midlands
Joint Electricity Authority v Pitt [1932] 2 KB 1, at p22, and Padfield
v Eastern Electricity Board (1971) 24 P&CR 423 at p425. The claimant
is entitled to compensation and this imports the principle of equivalence.
Compensation for a wayleave should therefore be assessed on the same principles
as compensation for compulsory purchase. Thus, the claimant should receive
market value for the interest acquired and compensation for injurious affection
to the retained land. The assumptions under sections 14 to 17 of the 1961 Act
are not, however, applied by the 1989 Act and do not apply to the present
reference. The claimant’s attempts to obtain a certificate of appropriate
alternative development under section 17 were misconceived.
Mr Bartlett
then referred to Mr Hope’s valuation, which he said has three fundamental
bases: a value of £450,000 per acre in the no-pylon world and having regard to
the certificates of lawful use; the sterilisation and complete loss of value of
the land beneath the pylons and the maximum swing of the line; and the complete
loss of value of land where the magnetic field strengths exceed background
levels and
submitted that the evidence does not support these contentions. Mr Hope valued
the reference land in its existing state for animal research, but was unable to
say what activities were comprised within this use; what was the condition of
the existing buildings and their fitness for use; and what, if any, planning
permissions would be granted. These omissions undermine his evidence.
Mr Bartlett
said that the certificates of lawful use are conclusive as to the matters
stated in them: see Town and Country Planning Act 1990, section 191(6) and Broxbourne
Borough Council v Secretary of State for the Environment (1978) 38
P&CR 381*, at pp389–390. It follows that, where a certificate is not
restrictive as to area or intensity of use, no such restriction can be implied
by reference to the earlier planning history: see Broxbourne. The
certificates relating to the reference land impose no restraints as to area or
intensity, although the permitted composite sui generis use would in
practice be restrictive. It would be a matter for the local planning authority
(or Secretary of State on appeal) to judge whether a particular use had the
necessary quality of compositeness or amounted to a use that was materially
different from that in the certificate: Wipperman v Barking London
Borough Council (1965) 17 P&CR 225, at p230. Mr Bartlett submitted that
the claimant has failed to establish what activities comprise an ‘animal
research’ use and thus has failed to show that it falls within the scope of the
certificates.
*Editor’s
note: Also reported at [1979] 1 EGLR 149; (1978) 249 EG 959
As to demand
for the reference land for the authorised use, Mr Bartlett said that there is
no evidence that anyone would wish to take the land for this purpose. It has
not been used since 1984. The only indication of demand is the interest shown
by Microviral. This evidence is of no probative value. Mr Bartlett particularly
referred to Mr Macleod’s remarks in opening that he did not know who Microviral
are, what they do, or where they come from. National Grid have been unable to
establish the existence of Microviral. Mr Hope was not directly involved with
the Microviral negotiations.
Mr Bartlett
referred to the evidence of Mr Moody as to the condition of the buildings on
the reference land. They are basic livestock buildings, derelict and vacant for
13 or 14 years. Rebuilding, structural alterations and other works undertaken
by a builder would constitute development and require planning permission
unless those works did not materially affect the exterior of the building: see
section 55(1A) and (2)(a) of the 1990 Act. Livestock buildings converted to
laboratories and offices would constitute a material change of use under the
building regulations and would also need planning permission. Mr Hope accepted
in his evidence that the buildings would need rebuilding or substantial
refurbishment to provide a modern animal research facility.
Mr Bartlett said
that, for rebuilding, no reliance can be placed on the planning permission for
the erection of the building. A permission is spent when the permitted
development has been carried out: Cynon Valley Borough Council v Secretary
of State for Wales (1986) 53 P&CR 68*, at pp73–77, and Durham County
Council v Secretary of State for the Environment (1989) 60 P&CR
507, at p513. A planning permission also becomes incapable of implementation if
the permitted development is not started within five years: see section 9(1) of
the 1990 Act. Only Mr Judd dealt with the question whether planning permission
would be granted and concluded that permission was most unlikely to be
forthcoming for rebuilding and use for animal research. Mr Hope conceded that
it was almost impossible to obtain planning permission for animal research use.
Considered with his evidence that planning permission would be needed, this
effectively destroyed his valuation.
*Editor’s
note: Also reported at [1986] 2 EGLR 191; (1986) 280 EG 195
Mr Bartlett
referred to the Grassland Research Institute property at Hurley and said that
it is not comparable to the reference land. He then turned to the two
comparables used by Mr Hope to justify his value of £450,000 per acre for the
reference land (Warren Spring and Oxford Science Park) and said that these
comparables, given in evidence by Mr McLeod, were not available to Mr Hope when
he prepared his valuation. Plainly, therefore, he did not base his valuation on
them. Furthermore, they are not reliable comparables. The Warren Spring sale
was to a special purchaser and the reference to Oxford Science Park was not to
a transaction and the information given related to a time six years before the
valuation date for the reference land. It is clear, said Mr Bartlett, that it
was really the Microviral offer which formed the basis of Mr Hope’s valuation.
This is, however, worthless as evidence of value: it was not a transaction and
there is no evidence of the planning assumptions on which it was based.
With regard to
the value of the land taken, Mr Hope took this to be the sites of the pylons
and the land under the maximum swing of the line. Mr Bartlett said that this is
clearly wrong. The land taken is a wayleave. It may be appropriate to treat the
land under the pylons as land taken (see Turris), but this is not the
position with the line, which simply occupies a small volume of airspace well
above the ground. Compensation for the line should be nominal: Turris.
With regard to
injurious affection, Mr Bartlett said that there is no evidence to support Mr
Hope’s contentions regarding the effect of electromagnetic fields on the value
of the reference land. Mr Hope based his injurious affection figures on three
matters. First, the withdrawal of Microviral from negotiations for the land.
This evidence is of no probative value for the reasons given earlier. Second,
evidence given at the necessary wayleave hearing on the possible effects of
electromagnetic fields on research operations. Mr Bartlett refuted this
argument by reference to the inspector’s conclusion that all the magnetic field
strength predictions were well within the guidelines of the National
Radiological Protection Board (para 6.4.2 of the inspector’s report) and by
reference to the inspector’s rejection of the claimant’s contentions at the
hearing as to the effect on animal research operations: paras 6.4.4 to 6.4.6.
This suggests that the market would not be concerned regarding this matter.
Third, comments in the inspector’s report about the public perception of
electromagnetic fields and the effect on value: para 6.4.7. Mr Bartlett said
that these comments are of no significance in these proceedings. The inspector
was not a valuer and was not deciding a valuation matter. Whether public
perception regarding electromagnetic fields has an adverse effect on value can
only be determined on the evidence. There is no such evidence in this
reference.
Mr Bartlett
invited me to reject Mr Hope’s valuation. It is not supported by the evidence
and has been incorrectly made on the basis that the wayleave was granted in
perpetuity. The submission by Mr Cooper that this is supported by the decision
in Clouds Estate Trustees v Southern Electricity Board is
incorrect. Mr Bartlett submitted that I should accept Mr Carey’s valuation
which is based on the planning evidence of Mr Judd.
Finally, Mr
Bartlett considered the evidence of Mr Lyall, which was prepared after he had
received Mr Judd’s report. Mr Bartlett submitted that this evidence leads
nowhere. No valuation is based on it and there is no equivalent evidence
directed to show whether a lesser form of development would be permitted in the
absence of the electric line. Mr Bartlett said that there is no indication that
the local planning authorities or the Secretary of State would refuse planning
permission, or grant planning permission for less development, in the absence
of the electric line. Mr Lyall’s estimate of B1 development is based on the
same area of buildings which have the benefit of the certificates of lawful
use. There is no justification for this approach. Furthermore, his estimate of
housing development (30 houses) is based on assumed planning permissions for
130,000 sq ft. Again, this assumption is not supported by the evidence.
Claimant
The claimant’s
closing submissions were made by Mr Cooper, solicitor of Gouldens.
He said that
the claimant is entitled to compensation for the damage he has suffered by the
grant of the necessary wayleave. He cannot use the land beneath the pylons and
line and cannot use the remainder of
of the permitted use under the certificates of lawful use. Compensation is to
be assessed under para 7 of Schedule 4 to the 1989 Act and under the Land
Compensation Act 1961 and the Compulsory Purchase Act 1965. The grant of a
necessary wayleave is the compulsory acquisition of a right over land and
therefore the compulsory purchase legislation applies to the assessment of
compensation. If it is not to apply it would have been expressly excluded by
the 1989 Act. Any doubt on this point must be resolved against National Grid.
It is particularly important to note that sections 14 to 17 of the 1961 Act
apply to the assessment of compensation in this reference.
Mr Cooper said
that, although it is accepted that the development plans are against the
development of the reference land for any purpose, it must be borne in mind
that the certificates of lawful use are a material consideration when
considering the grant of planning permission. It is necessary to balance the
development plan policies against the certificates. The local planning
authorities would have granted planning permission, in the absence of the
pylons and line, for the comprehensive development suggested by Mr Lyall, in
order to remove the permitted non-conforming use under the certificates of
lawful use. These certificates are not limited by space and intensity and the
local plan policies predate the issue of these certificates.
Mr Cooper
referred to policy OC3 in the structure plan (which applies to major existing
developed sites in the countryside) and said that it is reasonable to assume a
similar policy for smaller sites in the local plans. The reference land has a
non-conforming use and this must be addressed. Tree preservation orders were
made within two months of the issue of the certificates of lawful use and were
clearly made to obstruct the possible development of the land. A memorandum
from Aylesbury Vale District Council dated November 28 1995 states that the
threat to the trees is from ‘possible development proposals’.
Mr Cooper said
that the certificates of lawful use can be implemented without further
consents. Therefore, where planning permission is required to refurbish the
existing buildings or to rebuild the previous buildings on the land, the only
consideration is any material alteration to the existing facades. Design
requirements can be met without materially affecting the external elevations, and
therefore planning permission would not be required for the repair,
refurbishment or rebuilding of many of the buildings. Mr Cooper referred to
section 55 of the 1990 Act. Even if planning permission becomes necessary it
would be granted by the local planning authority or on appeal. The current
position is that 200,000 sq ft of existing and previous buildings on the
reference land can be reused or re-erected without planning permission. A
building erected under a planning permission can be demolished and rebuilt
within five years without the need for a further permission. Mr Cooper referred
to the Cynon decision. The certificates of lawful use allow the
rebuilding or repair of the existing buildings on the reference land without
further planning permissions, provided there is no material change in the
external appearance of the buildings.
An alternative
approach is to consider what development would be granted in the real world,
with or without the application of sections 14 and 15 of the 1961 Act. The
claimant asserts that section 15(3) applies and therefore it is to be assumed
that planning permission has been granted for buildings broadly equivalent to
those previously existing on the reference land. But even if this is not the
position, it is legitimate to ask the local planning authorities what planning
permission would be granted to remove the certificates of lawful use. This was
the approach of Mr Judd, but he carried it out incorrectly for two reasons.
First, he carried it out in the real world and not the no-pylon world. Second,
it produced a value below the value of the land with the certificates of lawful
use.
Mr Cooper made
further criticisms of Mr Judd’s planning evidence. Mr Judd referred to two
letters from Wycombe District Council, dated February 15 1995 and February 6
1996 respectively, to support his case that planning policies do not permit any
development of the reference land. Mr Cooper said that both letters were
written before the grant of the certificates of lawful use and the statement made
by the council to the necessary wayleave hearing. The planning history of the
reference land has been overtaken by the certificates, which Mr Judd accepted
were valuable planning documents. Mr Judd agreed that, if the local planning
authorities wished to eliminate the certificates, they would be prepared to do
a deal regarding the grant of planning permission for alternative development
and, said Mr Cooper, this would be more substantial than that proposed by Mr
Judd. Although Mr Judd maintained that Mr Lyall’s alternative development would
fail in terms of scale, he accepted that the certificates of lawful use were
unrestricted in terms of scale and intensity. Conditions could not be attached
to redevelopment. Mr Judd referred to the making of tree preservation orders by
the local planning authorities, but had to admit that the grant of planning
permission was a possibility.
Turning to the
valuation evidence, Mr Cooper said that Mr Hope’s valuation is correctly based
on the 1961 Act, the decisions of the Lands Tribunal in Turris and Naylor
and the comparable evidence provided by Warren Spring, Oxford Science Park,
Hurley, and the Microviral offer. His basis of valuation, for an animal
research use, was correct. The Microviral offer was real. Mr Hope was justified
in taking the view that value for the purposes of the certificates of lawful
use was the highest value. Although he considered other possible uses and
values, he did not need to provide a series of unrealistic alternative
valuations.
Commenting on
Mr Hope’s valuation, Mr Cooper emphasised that the land under the pylons and
line has been rendered valueless, that there is a general public perception
affecting value as to the risk of electromagnetic fields and that an
apprehension of damage can be a material consideration for planning purposes:
see West Midlands Probation Committee v Secretary of State for the
Environment (1997) Sol J August 8 1997. He drew attention to the RICS
Appraisal and Valuation Manual para PSA 3.7. Mr Cooper said that the necessary
wayleave severs the reference land and hampers the potential for development.
He also referred to the evidence given at the necessary wayleave hearing by Dr
Jeffers and to the fact that the claimant cannot now terminate the wayleave due
to noise from the electric line. Mr Hope is correct in assessing compensation
for the wayleave as if it had been granted in perpetuity. He cited in support
the decision of the Lands Tribunal in Clouds Estate Trustees v Southern
Electricity Board, at p185.
Mr Cooper made
the following criticisms of Mr Carey’s valuation:
(i) he did not
have regard to sections 14 to 16 of the 1961 Act;
(ii) it is
based on limited knowledge of the science and research property market;
(iii) he did
not put forward an agricultural value nor disclose his development appraisal
until cross-examination;
(iv) the
certificates of lawful use clearly give value to the reference land and Mr
Carey’s valuation of the land taken is therefore based on a flawed assumption;
and
(v) the only
other valuation prepared by Mr Carey was of the damage suffered under Mr Judd’s
pragmatic development scheme, which he admitted would not be carried out.
Mr Cooper
criticised Mr Moody’s evidence, which he said was incorrectly based on the assumption
that the buildings on the reference land would be demolished and the land
returned to agricultural use. He did not consider the possible refurbishment of
these buildings.
In opening his
case, Mr Macleod said that his claim has been calculated in accordance with the
principle in West Midlands Joint Electricity Authority v Pitt,
but this point was not explained further.
Decision
I have
inspected the reference land accompanied by representatives of the parties.
The issues
that I identified earlier in this decision will now be considered under the
general headings of planning and compensation. Throughout this decision I am
looking at the position as at August 27 1996.
Planning
The planning
position is fundamental to the question of compensation. The three questions
under this heading relate to the scope of the certificates of lawful use, the
extant planning permissions and the planning permission likely to have been
granted for the redevelopment of the reference land.
(a)
Certificates of lawful use
The first
question is what is the scope of the certificates of lawful use? These were
issued in September 1995 and are described in paras 16 and 17 of the facts.
Important points to note are that the lawful use is not given a general
description (eg as an animal research centre), but is described as a use for a
composite purpose, which is then detailed by reference to particular
activities, which constitute a sui generis use that does not fall within
the Town and Country Planning (Use Classes) Order 1987. It is clearly not a B1
use.
The law
governing certificates of lawful use is contained in section 191 of the 1990
Act. Subsection (1) paras (a) and (b) provide that a person who wishes to
ascertain whether ‘any existing use of buildings or other land’ or ‘any operations
which have been carried out in, on, over or under land’ are lawful may apply to
the local planning authority. If satisfied, the authority shall issue a
certificate to the effect that the use or operations are lawful and this
lawfulness ‘shall be conclusively presumed’: subsections (4) to (6). Where, as
in both of the certificates on the reference land, the certificate does not
specify a particular level or intensity of activity on the land, then the use
specified is without limit as to space within the site or intensity: Broxbourne
Borough Council v Secretary of State for the Environment, at p390.
However, I accept Mr Bartlett’s submission that the description in the
certificates of the use as a composite sui generis use comprising
specified activities would, in practice, be restrictive. It would be for the
local planning authorities (or the Secretary of State on appeal) to judge as a
matter of fact and degree whether a particular use had the necessary composite
quality or would be materially different from the specified lawful use: Wipperman
v Barking London Borough Council, at p230.
The question
arose during the hearing as to whether the certificates of lawful use permit
the rebuilding or substantial reconstruction of the buildings on the reference
land, although the claimant’s case on this point was not entirely clear. I am
satisfied that the certificates relate to the lawful use of the reference land
and do not permit the carrying out of operations on the land that amount to
development under the 1990 Act. To ascertain what operations can be carried out
without planning permission it is necessary to look at the relevant provisions
of the 1990 Act, not at the certificates of lawful use.
Section 55(1)
of the 1990 Act defines ‘development’ to include the carrying out of building
operations and subsection (1A) defines ‘building operations’ to include
demolition of buildings, rebuilding, structural alterations of, or additions
to, buildings and other operations normally undertaken by a builder. Subsection
(2) sets out a list of operations or uses which do not involve development
including (in para (a)):
the carrying
out for the maintenance, improvement or other alteration of any building of
works which —
(i) affect
only the interior of the building, or
(ii) do not
materially affect the external appearance of the building, …
Thus, planning
permission would be required to demolish and rebuild the existing buildings on
the reference land and to carry out structural alterations or additions, but
not to maintain, improve or otherwise alter them where the works affect only
the interior or do not materially affect the external appearance. Having regard
to the evidence of Mr Moody and my inspection, I am of the opinion that, due to
the poor state of repair and dilapidation of the buildings, little could be
done to make them usable again without the carrying out of works requiring
planning permission. Repair and improvement works that do not materially affect
the external appearance would be limited. Rebuilding and extensive improvement
are required if the buildings are to be occupied again for the composite lawful
use and, as I show later in this decision, planning permission is unlikely to
be granted for these works.
(b) Extant
planning permissions
The second
question is, were there planning permissions still in existence in August 1996
authorising the rebuilding of buildings subsequently demolished, or the
construction of new buildings, which were, or would have been, part of the
former BOCM agricultural research centre? During the hearing these permissions
were referred to as ‘extant planning permissions’ and I adopt this term.
The claimant’s
evidence on this point was brief, contradictory and unsatisfactory. Mr Hope
referred to 19,500m2 of buildings covered by extant planning
permissions, but he was not more specific regarding these buildings. Mr Lyall
said that the claimant is advised that there are extant planning permissions
covering 14,126m2 of buildings, but gave no supporting evidence. The
claimant confirmed that he would not be adducing any further evidence on this
matter. In his closing submissions, Mr Cooper referred to 200,000 sq ft
(18,580m2) of buildings which can be reused or rebuilt without
further consent. (The parties have agreed that the area of the existing
buildings is 6,591 m2 and presumably this leaves 11,989 m2
covered by extant planning permissions on Mr Cooper’s figures.) I was given as
part of the court bundle a ringbinder containing copies of numerous planning
permissions granted between July 1949 and June 1980, but no further evidence or
submissions were given to me as to which permissions it is alleged are still
capable of implementation.
Against this
unsatisfactory background of fact, I look at the law regarding the duration of
planning permissions. Planning permissions granted before April 1 1969, where
development had not begun before 1968 and where the permission does not contain
an express condition as to the start or completion of development, are deemed
to be subject to a condition that the development must be begun before April 1
1974: Schedule 24 to the Town and Country Planning Act 1971 and Planning
(Consequential Provisions) Act 1990, Schedule 3, para 1. Planning permissions
granted after April 1 1969, without an express condition regarding the start of
development, are subject to an implied condition requiring development to be
begun not later than five years from the grant of the permission: section 91 of
the 1990 Act. Outline planning permissions are, in the absence of an express condition
as to duration, subject to an implied condition requiring an application for
approval of reserved matters to be made within three years and for development
to be started within five years from the grant of the permission or within two
years from the final approval of reserved matters: section 92 of the 1990 Act.
Applying the
law to the limited evidence in this reference, it seems to me that there could
be two situations: where planning permission has been granted and the building
erected and subsequently demolished; and where planning permission has been
granted, but not implemented.
Where a
building has been constructed and subsequently demolished, is the authorising
planning permission still extant, thus permitting the rebuilding of the
demolished building without further permission? The claimant says that the
original permission is still valid. In my view, this is incorrect for two
reasons. First, the original permission is spent when implemented by the
construction of the permitted building: it cannot be reactivated at a later
date to authorise the rebuilding of the demolished building. In Cynon Valley
Borough Council v Secretary of State for Wales planning permission
was granted in 1958 for the use of premises as a fish and chip shop. The
permission was implemented. In 1978 the premises were let temporarily as an
antique shop and in 1983 the owner wished to use the property as a Chinese
takeaway. It was held by the Court of Appeal that the 1958 planning permission
did not authorise a change of use from antique shop to Chinese takeaway: it was
‘spent’ when the original change of use was implemented. Balcombe LJ said, at
p76:
where the
development for which planning permission is required is a material change of
use, the permission is to change from use A to use B, and is not
merely a permission to use the property for use B for the indefinite future.
Later,
referring to the speech of Lord Fraser of Tullybelton in the House of Lords in Young
v Secretary of State for the Environment [1983] 2 AC 662*, he said, at
pp76–77:
*Editor’s
note: Also reported at [1984] 1 EGLR 166; (1983) 269 EG 219
There is
implicit in this reasoning a conclusion that the planning permission granted in
1969 for use as a light industrial building was spent once the change was
complete and did not cover the further change to light industrial use in 1977.
This decision was
approved by the Court of Appeal in Durham County Council v Secretary
of State for the Environment, but a distinction was drawn between a change
of use and operational development, where the permission is not spent when the
development begins. Clearly, as a matter of commonsense, this must be correct
or there would be no permission to complete the development. But, in my view,
the principle underlying these decisions is that when a planning permission has
been fully implemented by a change of use or the completion of operations (eg
the completion of a building), then it is ‘spent’ and cannot be reactivated to
permit a further change of use or development. I should add here that any
further change of use or rebuilding would have to take place before April 1
1974, where the permission was granted before April 1 1969, or within five
years where the permission was granted after that date, or the permission would
have automatically lapsed under the time-limits referred to above.
Where a
planning permission has been granted but not implemented at all, the issue of
‘spent’ permissions does not arise, but the five-year period for implementation
does and, at the date of valuation in August 1996, would render invalid any
permissions granted before August 27 1991. As I understand the claimant’s case,
he is relying on (unspecified) planning permissions granted during the BOCM
occupation of the reference land. This ceased in 1984. It must follow,
therefore, that, even if these permissions were not spent by implementation,
they had lapsed before the date of valuation. The latest planning permission in
the court bundle was granted in June 1980, which would have lapsed in June
1985.
I find that
there are no extant planning permissions relating to the reference land. This
view was shared by Mr JH Byrne, development control manager of Wycombe District
Council, who wrote to Mr Judd on January 3 1997:
I am not aware
of any applications having been granted permission on this site in the last
five years. Any unimplemented permissions older than this would presumably by
now have lapsed and would not be implementable. I am at a loss to understand
how it could be suggested that such a large amount of floor space could be
built without the need for further planning permission.
(c)
Planning permission for development
The third
question is what planning permission would have been granted in August 1996 for
the development of the reference land with and without the existing pylons and
electric line on the site? This question relates to redevelopment for an animal
research centre and for the alternative development schemes put forward by Mr
Lyall and Mr Judd respectively.
During the
hearing I said to Mr Macleod that this issue could have been resolved, or at
least clarified, by the making of applications for planning permission. Mr
Macleod, however, unsuccessfully sought to persuade the local authorities and
the Secretary of State for the Environment to issue certificates of appropriate
alternative development under section 17 of the 1961 Act. Not surprisingly,
and, in my view, correctly, they refused to do so mainly on the ground that the
grant of a necessary wayleave is not a compulsory purchase, a matter to which I
shall return later in this decision. The present unsatisfactory position is,
therefore, that I am required to make an informed guess as to the decisions
that would have been made by the local planning authorities on planning
applications for the development schemes put forward by Mr Lyall and Mr Judd.
This tribunal is not a planning authority, a point made by the then president
in Williamson and Stevens (Executors of Walter Williamson Dec’d) v Cambridgeshire
County Council (1977) 34 P&CR 117 (not cited).
Mr Lyall
prepared his planning evidence in the no-pylon world. He said that planning
permission would have been granted for up to 6,591m2 of B1
development and up to 30 houses, the remainder of the land reverting to
agriculture, forestry or some other appropriate use. Also, planning permission
would have been granted for the modernisation of the existing buildings. Mr
Judd said that the pylons and line did not affect his conclusion as to the
planning permission likely to have been granted. He put forward a pragmatic
scheme likely to obtain planning permission comprising two houses, up to 1,000m2
of B1 development and the reversion of the remainder of the land to
agriculture. Planning permission would not have been granted for redevelopment
as an animal research establishment as proposed by Microviral.
In considering
the planning permission likely to have been granted on the reference land in
August 1996, I have had regard to past appeal decisions, the relevant policies
in the structure and the local plans, the certificates of lawful use and the
views of the local planning authorities revealed in correspondence. I give no
weight to the claimant’s ‘planning comparables’, Brockham Park and Hurley. The
location and description of these properties, the planning position and the
relevant planning policies, all differ from the reference land.
I look first
at past decisions (see para 15 of the facts), particularly the refusal on
appeal for the new village and for the storage of Calor gas. On February 16
1990 planning permission was refused for a new village. I draw attention to two
paragraphs in the decision letter:
5. The
Secretary of State agrees with the Inspector that, although the appeal site is
not a virgin site, it cannot be regarded as a built-up or substantially
developed site and that it should be considered as a predominately open area
located in open countryside. He accepts the Inspector’s view that the appeal
proposal would result in a large area of built development in the countryside
and would introduce a more urban feature along a considerable stretch of the
A4010 road between Stoke Mandeville and Terrick.
9. The
Secretary of State concludes that, for the reasons given above, the appeal
proposals would be contrary to established national and county policies and
that no justifiable reasons have been demonstrated which would warrant making
an exception to those policies in this case. He accepts the Inspector’s
conclusions and recommendations and hereby dismisses your clients’ appeal.
On February 20
1996 planning permission was refused for the open storage of Calor gas
cylinders on part of the reference land. I draw attention to part of para 6 of
the inspector’s decision:
Although
related to agricultural activity, the certified use is plainly not agriculture
and it is clear from the background information that the centre was, at one
time, a significant employer. Any development proposal should, in my view,
therefore be assessed against the policies relating to such sites rather than
policies applying to new non-agricultural development in the countryside.
However, since the proposal does not involve the re-use of an existing
building, it does not, to my mind, fall to be considered against strategic
policy 36 or local Policy RC22.
I look now at
the relevant policies in the development plans: para 21 of the facts.
In the
Buckinghamshire Structure Plan the reference land is located in open
countryside about 600m beyond the boundary of the green belt and Chilterns Area
of Outstanding Natural Beauty. Policy OC1 provides that development in the open
countryside outside the green belt and built-up areas will be limited.
Permitted development includes: development reasonably required for agriculture
or forestry; the reuse or redevelopment of major existing developed sites
identified in local plans, in accordance with policy OC3; and the reuse of
substantial existing buildings capable of conversion. Policy OC3 allows the
reuse or redevelopment of major existing developed sites in the open
countryside provided that certain criteria can be met,
no greater and preferably less than the existing use, and there being no
unacceptable loadings on the existing highways. The reference land is not
identified in either local plan under this policy. Policy E4 also refers to
major existing developed sites, to be developed under policy OC3, and refers to
residential and employment-generating development. Policy LS1 sets out location
and design criteria for development in the open countryside, in order to
minimise impact. Policy IN1 refers to development infrastructure and services.
The
south-western part of the reference land is within Wycombe District Local Plan
and is shown as open countryside on the proposal maps. Policy C6 relates to
development in the open countryside. It contains a restricted list of
development which may be permitted (eg agriculture, forestry, outdoor sport,
infilling) and provides for the general exclusion of development which would
detract from rural character or visual amenities. Policy C8 relates to the
reuse and adaptation of buildings in the countryside. These will normally only
be permitted where six criteria can be met. These include the requirements that
the new activity would not detract from the rural amenities and that the
buildings would be of a form, bulk and design in keeping with the rural
surroundings. Para (iii) of this policy is particularly relevant to the
reference land. It provides that, with normal maintenance and repair, the
buildings are to be expected to last for many years, and that ‘buildings which
are derelict or which require complete or substantial reconstruction before
they can be reused will not be considered appropriate for reuse’. In my view,
this is the position at the reference land, indicating that planning permission
would not be granted for the reuse and adaptation of the buildings on the land
as an animal or agricultural research centre or for any other use. Policy E2
provides that planning permission will not normally be given for
employment-generating development on sites outside employment areas (which is
the case with the reference land).
The
north-eastern part of the reference land is within Aylesbury Vale (Rural Areas)
Local Plan. It is shown on the proposals map as open countryside without
notation. Policy RC1 sets out the general policy for development in the
countryside. This development will normally only be permitted where it is
essential for agriculture or forestry or countryside recreation or is otherwise
provided for in the plan. Policy RC6 relates to the future use of major
redundant sites in the countryside. This is a general policy: specific
redundant sites (not including the reference land) are given individual
consideration. The general policy is that planning permission will not normally
be granted for clearance and rebuilding unless neither the reuse of the
existing buildings nor redevelopment by conversion are realistic. Where
clearance and rebuilding are permitted the impact should be no greater and,
where possible, less than the existing development. The amenity value of the
site should be enhanced and the development should not result in additional
infrastructure or public expenditure. Policy RC20 is a restrictive policy relating
to the conversion to alternative uses of non-traditional buildings in the
countryside. In particular, extensions will not be allowed and the conversion
should not require recladding or a complete or substantial reconstruction.
Policies RE6 and 7 are generally restrictive of new employment uses in the
countryside, except under policies RC6 and 20 referred to above.
The reference
land is situated in open countryside and the policies summarised above indicate
that planning permission is unlikely to have been granted in August 1996 for
substantial redevelopment, whether for the sui generis use in the
certificates of lawful use or for an agricultural or animal research centre or
for any development not related to agriculture, forestry, tourism, recreation or
similar countryside use.
The
certificates of lawful use are relevant when considering whether planning
permission would have been granted for the redevelopment of the reference land.
They are a material consideration and could be used in negotiations with the
local planning authorities or on appeal. But I do not think that they would
have had the weight suggested by the claimant for two reasons. First, due to
the dilapidated condition of the existing buildings, the land could not be used
for the lawful use without substantial works of repair, alteration or
rebuilding, all requiring planning permission, which is unlikely to be granted.
Second, the certificates would only add weight to the claimant’s case if there
was demand for the permitted lawful use, thus persuading the local planning
authorities to grant permission for an alternative use as a quid pro quo
for the removal of the existing lawful use. As shown below, there was no demand
for the lawful use within the restrictive scope of the certificates. The land
could have been used for the lawful use at any time since 1984, but it has
remained vacant. This position would have been known to the local planning
authorities and would not, in my view, have strengthened the applicant’s hand
in seeking to negotiate, or obtain on appeal, planning permission for the
substantial redevelopment of the reference land.
Finally, I
refer to the correspondence between the local planning authorities and Mr Hope
and Mr Judd regarding the development of the reference land. On January 23 1997
Mr Judd wrote to both local planning authorities inquiring whether they would
consider favourably the development of the reference land for an animal
research establishment comprising 110,000 sq ft of buildings (including an
incinerator with a maximum stack height of 60 ft), a 20 ft high security fence
(with lighting) and a car park with 120 spaces. (Mr Judd’s evidence was that
this was the development proposed by Microviral, but no other evidence was
adduced to support this statement.) Wycombe District Council replied that there
would be a fundamental objection to this proposal unless exceptional
circumstances existed that outweighed the normal policies in the development
plans (letter dated February 3 1997). A similar reply was sent by Aylesbury
Vale District Council (letter dated February 5 1997).
On February 15
1995 the district solicitor to Wycombe District Council wrote comprehensively
to Mr Hope regarding the planning position on the reference land. With regard
to redevelopment, he stated that the development plan policies:
would
militate against any redevelopment proposals … that were not required in the
interests of agriculture or forestry or some other use appropriate to its
location in open countryside. In addition the Highway Authority has indicated
its concern about any development that would increase highway danger and
adversely affect the function of the road as an inter-urban highway.
On February 6
1996 the district solicitor sent to Mr Hope a letter to assist the Lands
Tribunal in determining compensation. This stated that the uses that would
normally be regarded as acceptable on the reference land are: the sui
generis use as detailed in the certificate of lawful use; agriculture or
forestry; and a use which falls within policy C6 of Wycombe Local Plan, subject
to other relevant policies in the plan.
On July 2 1997
the development control manager of Wycombe District Council wrote to Mr Judd
regarding his pragmatic development scheme. He referred to the policies in the
development plans and said that it is ‘safe to say that the erection of
dwellings on North Lee Lane and the construction of one building to a maximum
of about 1,000 square metres would not sit squarely with those policies’. He
could not indicate further whether his council would be likely to find that the
benefits of the scheme outweigh the policy objections or otherwise.
Having regard
to this planning evidence I find that at the valuation date:
(i) Planning
permission would have been refused for the redevelopment scheme put forward by
Mr Lyall (up to 6,591 m2 of B1 development, up to 30 houses and the
reversion of the remainder of the land to agriculture). Refusal of planning
permission would have occurred in both the real world and the no-pylon world.
The presence of the pylons and line would have had no effect on this decision.
(ii) Planning
permission would have been refused for the redevelopment of the reference land
as an animal or agricultural research centre, that is to say the Microviral
scheme put forward by Mr Judd or a smaller scheme involving more than minor
repairs to the existing buildings. This refusal of planning permission would
also
power line would have had no effect on this decision.
(iii) Planning
permission might have been granted for the pragmatic development scheme
proposed by Mr Judd (two houses, up to 1,000 m2 of B1 development
and the reversion of the remainder of the land to agriculture). Mr Carey, in his
valuation evidence, said that a prospective purchaser would have reduced his
bid to 30% of full value to reflect this uncertainty. I agree. On the evidence
there was only about a 30% chance of planning permission for the pragmatic
scheme. As above, the position would have been the same in the real world and
in the no-pylon world.
My conclusion
is, therefore, that the only planning permission likely to have been granted
for the redevelopment of the reference land is that for Mr Judd’s pragmatic
scheme. The likelihood of the grant of this permission was about 30%. The
pylons and line had no effect on the grant or refusal of planning permission
for the development proposals put forward by the parties, which would have been
decided having regard to the restrictive policies in the development plans and
not by reference to the existence of the pylons and line on the land.
Compensation
The four
questions under this heading relate to: the statutory basis of compensation;
the effect of certificates of lawful use on value; the term of the wayleave for
the purpose of assessing compensation; and the amount of compensation for the
necessary wayleave.
(a)
Statutory basis of compensation
The first
question is whether compensation for the grant of the necessary wayleave is to
be assessed by reference to para 7 of Schedule 4 to the 1989 Act or also by
reference to the legislation relating to compensation for compulsory purchase.
Mr Cooper, for
the claimant, contended that the grant of the wayleave was a compulsory
acquisition and therefore the legislation governing compensation for compulsory
purchase applied, particularly the planning assumptions contained in sections
14 to 17 of the 1961 Act. Mr Bartlett submitted that the statutory provisions
governing compensation for the grant of a wayleave are contained in para 7 of
the 1989 Act, but that the principles underlying compensation for compulsory
purchase, particularly the fundamental principle of equivalence, also apply.
Thus, the claimant is entitled to compensation for the wayleave (similar to
compensation for land taken) and for injurious affection to the remainder of
the land. The planning assumptions contained in sections 14 to 17 of the 1961
Act do not apply to compensation for a wayleave under the 1989 Act.
I look first
at Schedule 4 to the 1989 Act. Para 6 gives the Secretary of State power to
grant a ‘necessary wayleave’, that is to say ‘consent for the license holder’
(National Grid) ‘to install and keep installed the electric line on, under or
over the land and to have access to the land for the purpose of inspecting,
maintaining, adjusting, repairing, altering, replacing or removing the electric
line’. Para 7 of Schedule 4 gives a right to compensation in the following
terms:
7. — (1) Where a wayleave is granted to a licence holder under paragraph
6 above —
(a) the
occupier of the land; and
(b) where the
occupier is not also the owner of the land, the owner,
may recover
from the licence holder compensation in respect of the grant.
(2) Where in
the exercise of any right conferred by such a wayleave any damage is caused to
land or to moveables, any person interested in the land or moveables may
recover from the licence holder compensation in respect of that damage; and
where in consequence of the exercise of such a right a person is disturbed in
his enjoyment of any land or moveables he may recover from the licence holder
compensation in respect of that disturbance.
(3)
Compensation under this paragraph may be recovered as a lump sum or by
periodical payments or partly in one way and partly in the other.
(4) Any
question of disputed compensation under this paragraph shall be determined by
the Tribunal; and sections 2 and 4 of the Land Compensation Act 1961 … shall
apply to any such determination.
In my view,
compensation for the grant of a necessary wayleave is to be assessed under para
7 of Schedule 4 to the 1989 Act and not also by specific reference to the
legislation relating to compensation for compulsory purchase. I give three
reasons for this conclusion.
First, para
7(4) of Schedule 4 to the 1989 Act states that any question of disputed
compensation shall be determined by the Lands Tribunal (see also para 12) and
that sections 2 and 4 of the 1961 Act shall apply to such determination. These
sections relate to Lands Tribunal procedure and costs respectively. If the
whole of the compensation legislation applied to compensation under para 7,
then the express incorporation of sections 2 and 4 of the 1961 Act would not
have been necessary. If it had been the intention of parliament to incorporate
the whole or other parts of the compensation legislation into the determination
of compensation under para 7, then there would have been express provision for
such incorporation.
Second, a
distinction is made in the 1989 Act between the acquisition of a wayleave,
which is dealt with in paras 6 to 8 of Schedule 4, and the compulsory
acquisition of land, which is dealt with in Schedule 3. In my view, this is a
clear indication that compensation for the grant of a wayleave is to be assessed
under para 7 of Schedule 4 to the 1989 Act. I note that the necessary wayleave
in this reference was not acquired under a compulsory purchase order and notice
to treat has not been served. Para 14 of Schedule 3 expressly provides that:
The enactments
in force in England and Wales with respect to compensation for the compulsory
purchase of land shall apply with the necessary modifications as respects
compensation in the case of a licence holder’s compulsory acquisition of a
right by the creation of a new right as they apply to compensation on the
compulsory purchase of land and interests in land.
Thus, where a
licence holder acquires a new right over land by compulsory purchase under
Schedule 3, the legislation relating to compensation on compulsory purchase is
applied to the determination of compensation. But where a licence holder
acquires a necessary wayleave under para 6 of Schedule 4, compensation is
determined in accordance with para 7 of that Schedule. This contains no
provision similar to para 14 of Schedule 3 for the application of the
compensation legislation.
Third, para
7(3) of Schedule 4 provides that compensation for a wayleave may be a lump sum
or periodical payments. This is inconsistent with compensation for compulsory
purchase where it is implicit in the transaction — a sale and a purchase — that
the price is a once for all capital payment ascertained at a particular date:
see eg Colac v Summerfield [1893] AC 187 and R v Brown
(1867) LR 2 QB 630 (not cited). I note that the member of the tribunal (VG
Wellings QC) in Clouds Estate said (at p195) that it does not
necessarily follow that compensation for compulsory purchase must always be a
capital payment. However, without expressly deciding the point, I am of the
opinion that provision for annual payments is, at the least, an indication that
the transaction or grant is not a compulsory purchase. I also note that in both
Padfield and Clouds Estate compensation for the grant of a
wayleave for an electric line was assessed as if it were the compulsory
acquisition of rights over land. Both decisions, however, related to the
legislation which preceded the Electricity Act 1989 and I distinguish them on
this ground.
It follows
from my decision on this issue that the 1961 Act (including sections 14 to 17
relating to assumptions as to planning permission), the Compulsory Purchase Act
1965 and the Land Compensation Act 1973 (including section 52 relating to
advance payments of compensation, referred to earlier in this decision) do not
apply to the assessment of compensation on the grant of a necessary wayleave. I
should add that, even if sections 14 to 17 of the 1961 Act did apply, they
would not greatly assist the claimant in establishing the planning permission
likely to be granted in the no-pylon world. These provisions apply to ‘the
relevant land’, which is defined in section 39(2) of the 1961 Act ‘to mean the
land in which the relevant interest subsists’ and ‘the relevant interest’ is
the land acquired pursuant to a notice to treat. Thus, these planning
assumptions, including those under a certificate of appropriate alternative
development, could only apply to the site of the pylons and line and not to the
remainder of the
Transport (1982) 263 EG 983* (not cited). In any event, Mr Macleod had not
obtained a certificate of appropriate alternative development for the reference
land at the date of valuation or by the time of the hearing.
*Editor’s
note: Also reported at [1982] 2 EGLR 198
Although
compensation for the grant of a necessary wayleave is to be determined by
reference to para 7 of Schedule 4 to the 1989 Act, this provides for the
recovery of ‘compensation in respect of the grant’. The fundamental principle
of compensation is equivalence: see Horn v Sunderland Corporation
[1941] 2 KB 26 (not cited), at p49. It follows, therefore, that Mr Macleod is
entitled to compensation for all the loss (that is not too remote), that flows
from the grant of the necessary wayleave. This includes direct loss due to the
siting of the pylons and line on the land and indirect loss due to the
depreciation in value of the reference land that is not under the pylons and
line. This was the approach adopted by this tribunal in the past (see eg Turris
v Naylor) and which I adopt in this reference. The issue of the
statutory basis of compensation, raised by the claimant, is largely academic,
except in connection with alternative development under sections 14 to 17 of
the 1961 Act (which Mr Macleod has been unable to pursue), because both valuers
have assessed compensation for the pylons and line and for injurious affection
to the remainder of the reference land.
(b)
Certificates of lawful use
I considered
earlier in this decision the scope of the certificates of lawful use and their
role in the grant of planning permission. I have found that they permitted the
composite sui generis use of the land, but did not permit operations
amounting to development such as rebuilding or extensive improvements. I also
found that they would not have strengthened the applicant’s hand in seeking
planning permission for substantial redevelopment. In the light of these
findings I now consider whether they added to the value of the reference land
in August 1996. Mr Hope said that his valuation at £450,000 per acre reflected
the use of the land in accordance with the certificates of lawful use, but that
he did not rely on the Microviral offer as evidence of value. Mr Carey said
that the certificates did not enhance the value of the reference land.
It is common
ground that a certificate of lawful use is similar in effect to a planning
permission. In Viscount Camrose v Basingstoke Corporation [1996]
1 WLR 1100 (not cited) Lord Denning MR said, at p1106F:
It is not
planning permission by itself which increases value. It is planning permission
coupled with demand.
In the light
of my findings regarding the certificates of lawful use, it is my view they
could only have added to the value of the reference land if there was demand
for the land with the certificates — in other words, if the existence of the
certificates created a demand for the land and therefore increased the value.
Although Mr Hope purported to support his valuation by reference to the sales
of other properties used for research purposes, he was unable to show that
there was a demand for the reference land for that purpose other than the
interest shown by Microviral. Did that interest create a value of £450,000 per
acre? Would Microviral have been prepared to buy the land at this price, if the
pylons and line were removed, with the dilapidated buildings but without
planning permission for redevelopment for their proposed use? I look now at the
evidence regarding their interest in the reference land. Mr Hope gave limited
evidence on this matter and I was referred to documents and correspondence. Mr
Hope said that although Microviral would not disclose their proposed use of the
reference land, it could be carried on under the certificates of lawful use.
They would have been willing to take the land with the certificates and use the
existing buildings. He conceded, however, that he had not been directly
concerned with the Microviral negotiations.
The documents
to which I was referred start with the minutes of a meeting held on July 31
1996 between the claimant, representatives of National Grid and Mr J Miller of
ITR Telecom Ltd, representing Microviral. These minutes were prepared by the
claimant and were not agreed. They record that Microviral became interested in
the reference land in 1993. It was the site they wanted, although they were
looking at two others, but they could not operate on the land with the pylons
and line running across it. Microviral offered to pay 50% of the cost of
diversion. Microviral stated that they were quite happy with the current
planning position, although Mr Miller conceded ‘that some work in this regard
had to take place if any further development had to be undertaken over and above
the existing consents’. Microviral were still willing to pay £9m, subject to
discussion of line diversion costs with the claimant. On August 13 1996
National Grid wrote to Mr Miller stating that they were unable to agree to a
diversion of the electric line on the reference land.
On September 3
1996 Burnetts, solicitors in Carlisle acting for Microviral, wrote to Mr
Macleod’s then solicitors stating that Microviral were concerned as to the
possibility of their research being prejudiced by the existence of the power
lines and that negotiations with National Grid for the relocation of the lines
had now broken down. Microviral were unable to proceed with the proposed
purchase. If National Grid reverse their decision before an alternative site is
secured, then Microviral ‘are happy to proceed on the terms previously
discussed including at the purchase price of £9 million’. This letter was
acknowledged by Mr Macleod’s solicitors on September 9 1996 with a request that
Microviral provide a representative to speak at the Lands Tribunal hearing. On
September 11 the claimant wrote to National Grid confirming that a line
diversion was his ‘preferred option’ and that he was prepared to pay 25% of
these costs in addition to Microviral’s offer. This was rejected by National
Grid on September 17.
On December 20
1996 Hammond Suddards, solicitors to National Grid, wrote to Mr Miller seeking
further information regarding Microviral. This letter records the efforts made
to locate Microviral. It was acknowledged that a company by the name of
Microviral AG or Microviral Research existed but, despite inquiries in the
United Kingdom, Luxembourg, Switzerland and Germany, ‘no details have come to
light of the existence of this Company’. This produced letters dated January 10
1997 from Burnetts refusing the request for a representative of Microviral to
appear before the Lands Tribunal and informing Hammond Suddards that Mr Miller
acted ‘on behalf of a syndicate known as, for reasons of confidentiality,
Microviral’. Both letters confirmed that the matter was now at an end.
I think that
it is significant that Mr Macleod, who pursued many lost causes in presenting
his case, did not make more of Microviral’s interest in the land. Mr Hope said
that he did not rely on their offer as evidence of value, it was only a
background consideration. In opening his case Mr Macleod acknowledged that he
had virtually no information regarding Microviral, although Mr Cooper, in
closing, and who had not himself been present throughout the hearing, put their
offer forward as part of his justification for Mr Hope’s valuation. Mr Carey
gave evidence that he had been unable to find out whether Microviral purchased
a property or even if they showed an interest in other possible sites. On the
limited evidence regarding Microviral, I find that, even if they existed at
all, they were a shadowy organisation, which expressed only a preliminary
interest in the reference land. I cannot accept that they would have been
willing to pay £9m for 20 acres of the land if the pylons and line had been
removed, solely on the basis of the certificates of lawful use. It is
inconceivable that they would have paid that price to use the existing
dilapidated buildings. There was evidence that Microviral had not made contact
with the local planning authorities to discuss their use of land. If they had,
they would have received a discouraging response. I believe that their interest
would then have evaporated. They were unlikely to obtain planning permission
for the development of the reference land as an animal or agricultural research
centre on a scale (or possibly at all) to justify a price of £450,000 per acre.
There was no other demand for the reference land.
On the
evidence, I find that there was no demand for the reference land for the composite
use permitted under the certificates of lawful use and that these certificates
did not add to the value of the land.
(c) Term
of the wayleave
The third
compensation question relates to the term of the wayleave for the purpose of
assessing compensation. Is it to be assessed on the assumption that the
necessary wayleave will continue in perpetuity or on the assumption that it
will be terminated by notice after 15 years? The terms of the wayleave are set
out in para 10 of the facts. It remains in force until determined by either
party by notice after the expiration of 15 years. Mr Hope’s valuation is on the
assumption that the wayleave will continue in perpetuity and he made no
allowance for the fact that it could be terminated after 15 years. Mr Carey assumed
that the wayleave will be terminated at the end of the 15th year.
I agree with
Mr Carey’s approach. It is likely that the owner of the land will terminate the
wayleave at or after the 15th year and, if a further necessary wayleave is
granted, make a further claim for compensation having regard to the situation
at that time. If Mr Hope’s approach is correct, double compensation could arise
and breach the fundamental principle of equivalence. If compensation for loss
in perpetuity is paid at the start of the wayleave, the owner could terminate
it at the 15th year or thereafter, make a further claim if, as is likely, a
further necessary wayleave is granted, and thus obtain compensation again for
the loss from the date of termination in perpetuity. Mr Cooper supported Mr
Hope’s approach by reference to the decision of this tribunal in Clouds
Estate Trustees v Southern Electricity Board. It is true that in
this decision the member (VG Wellings QC) made a finding that, although the
wayleave consents were terminable, the board’s structures on the land were
permanent and unlikely to be removed in the foreseeable future. This was a
finding on the facts and does not set a precedent to be applied to this
reference. The member said, at p196:
My decision
is not a precedent to be used in the case of other land where the structures
may be less permanent or where the facts generally may be different.
Furthermore,
the compensation in that case comprised annual payments and therefore no
question of double compensation arose. Clouds may therefore be
distinguished from this reference where both parties have assessed the
compensation as capital sums. I cannot accept Clouds as authority for
the proposition that I must assess the compensation in perpetuity. This is a
question of fact.
I find that
compensation for the necessary wayleave over the reference land is to be
assessed on the assumption that it will be terminated by notice at the end of
the 15th year. Mr Hope put forward no evidence to suggest that an addition
should be made to Mr Carey’s valuation to reflect the possibility that the
wayleave will continue beyond the 15th year. Accordingly, I make no adjustment
to Mr Carey’s valuation on this matter.
(d)
Compensation for the necessary wayleave
I now arrive
at the fundamental question in this reference. What compensation should be
paid, assessed as at August 27 1996, for the retention of the pylons and
electric line on the reference land under the necessary wayleave and for any
consequent diminution in the value of that land? Mr Hope says £10,735,920; Mr
Carey, £3,431.41.
I have found
against the claimant on every issue in this reference and I wholly reject Mr
Hope’s assessment of compensation, which is based on value for an animal
research centre in accordance with the certificates of lawful use. I have found
that these certificates could only produce a value for the land if coupled with
demand and that there was no such demand. Mr Hope’s compensation assumes a loss
in perpetuity; I have found that it should be assessed on the basis that the
wayleave would be terminated at the end of the 15th year. Mr Hope put forward
no reliable evidence to support his figure of £450,000 per acre. The Microviral
offer at this figure was without substance and his other comparables are wholly
dissimilar from the reference land. These transactions required so many
adjustments that they afford no guidance as to the value of the reference land.
Mr Hope’s assessment of compensation was not supported by Mr Lyall’s planning
evidence, which led nowhere because Mr Hope said that value for this
alternative development would be lower than value for the existing animal
research use, but did not give an alternative valuation on this basis. In any
event, I have rejected the whole of Mr Lyall’s evidence. Mr Hope’s valuation
has been made on the wrong basis and is wholly unsupported and excessive. I
reject it entirely.
I am left with
Mr Carey’s assessment of compensation which, in the absence of a valuation on
this basis from the claimant, I accept. It is based on a 15-year wayleave,
which I have found to be a correct assumption and I was given no evidence to
suggest that Mr Carey’s figure should be increased to reflect the possibility
that the wayleave may continue beyond a 15-year term. Mr Carey’s figures are
based on Mr Judd’s pragmatic planning approach, which I have accepted. I agree
that the pylons and electric line did not reduce the value of the reference
land for the agricultural use and B1 development in Mr Judd’s scheme, but that
the two proposed residential plots would have suffered a 5% reduction in value
and that the residential plot value should be reduced to 30% of that value to
reflect the doubts regarding the grant of planning permission. I accept Mr
Carey’s figures for capitalised rent and for the capitalised compensation for
the occupiers’ payment as compensation for the existence of the pylons and
line. I think that Mr Carey’s valuation is correct.
Overall, I
find that the grant of the necessary wayleave has had a minimal effect on the
reference land and that this effect is fully compensated by an award of
£3,431.41. The claim is wholly misconceived, unsupported by reliable evidence
and grossly exaggerated. I reject the whole of the claimant’s case.
I determine
the compensation payable to the claimant by National Grid under para 7 of
Schedule 4 to the 1989 Act for the grant of the necessary wayleave dated August
27 1996 to be the sum of £3,431.41.
Several points
of law arose as subsidiary issues in this reference. Under r 50(4) of the Lands
Tribunal Rules 1996 I am required to ascertain, and state in my decision, any
alternative amount or value that I would have awarded or determined if I had
come to a different decision on the point of law. The points of law arose out
of the claimant’s case and either led nowhere or there was insufficient
supporting evidence to allow me to make an alternative award (eg as to the
scope of the certificates of lawful use and as to the existence of extant
planning permissions) or made no difference to the compensation awarded (eg as
to the statutory basis of compensation). I am unable therefore to make an
alternative award or awards of compensation in this reference.
Interest
The final
issue for my determination relates to interest. The parties have agreed that
interest is payable on the compensation, but disagree on the period and rate.
Mr Cooper sought compound interest with quarterly rests on the whole of the
compensation at rates of 4% above Barclays Bank base rates from September 15
1995, the date of the claimant’s letter terminating the former wayleave
agreements, to the date of payment. Mr Bartlett submitted that interest at the
compulsory rates should run from August 27 1996, the date of commencement of
the necessary wayleave and the agreed valuation date, to the date of payment of
the compensation. He said that, before the grant of the necessary wayleave,
National Grid had offered the old wayleave payments to the claimant, but these
had been rejected. As to my power to award interest, both parties referred me
to r 32(b) of the Lands Tribunal (Amendment) Rules 1997 and section 49 of the
Arbitration Act 1996.
The
Electricity Act 1989 is silent as to the payment of interest on an award of
compensation for the grant of a necessary wayleave. Furthermore, this Act is
not mentioned in Part I of Schedule 18 to the Planning and Compensation Act
1991, which contains a list of provisions where a right to interest on
compensation is given by section 80(1) of that Act. I have found that the
compulsory purchase legislation does not apply to compensation for a necessary
wayleave and therefore interest cannot be awarded under section 11(1) of the
Compulsory Purchase Act 1965. Both parties have referred me to section 49 of
the Arbitration Act 1996 as the source of my power to award interest.
In the Lands
Tribunal (Amendment) Rules 1997, r 9 amends r 32 of the 1996 Rules by
substituting in this rule certain sections of the Arbitration Act 1996,
including section 49 (interest), for similar provisions in the Arbitration Act
1950. R 12 of the 1997 Rules, however, provides that the substituted r 32 shall
only apply to proceedings commenced in the tribunal on or after the coming into
force of the 1997 Rules, that is to say on or after September 1 1997. This
reference commenced on September 11 1996 and is therefore governed by the
similar provisions regarding interest contained in the old r 32 of the 1996
Rules. This incorporates sections 19A and 20 of the Arbitration Act 1950.
Section 19A of
the 1950 Act gives this tribunal the power to award simple interest at such
rate as the member thinks fit on any sum paid before the award (up to the date
of payment) and on any sum which he awards (up to the date of the award).
Section 20 provides that a sum directed to be paid by an award shall, unless
the award otherwise directs, carry interest from the date of the award and at
the same rate as a judgment debt. The award of interest in this reference is
governed by these two provisions.
I agree with
Mr Bartlett that interest should run from August 27 1996, the date of the grant
of the necessary wayleave. On that date Mr Macleod became entitled to the
compensation that I have now quantified and should receive interest to
compensate him for the delay in the payment of that compensation. He did not
have a right to compensation before that date and I cannot accept, therefore,
that interest should run from the date when he terminated the previous wayleave
agreements. I also agree with Mr Bartlett that, although section 11(1) of the
Compulsory Purchase Act 1965 does not directly apply to this reference,
interest should be awarded at the prescribed rates for compensation for
compulsory purchase in preference to the commercial rates suggested by Mr
Cooper. The parties agree that interest on the compensation award should run to
the date of payment. I accept this agreement. Interest will run from August 27
1996 to the date of payment, in whole or in part. (I was told that an advance
payment of compensation has been made, but I was not told the amount.)
Accordingly, I
order that this award shall carry simple interest at the rates prescribed by
the Acquisition of Land (Rate of Interest after Entry) Regulations 1995 from
August 27 1996 to the date of payment in whole or in part, and on any further
compensation still unpaid after part payment up to the date of payment of the
balance of compensation.
This decision
determines the substantive issues between the parties and my award is final.
The question of costs remains outstanding and the parties are invited to make
submissions as to the costs of this reference and a letter accompanies this
decision as to the procedure for submissions in writing. I will, in due course,
incorporate an order as to costs in an addendum to this decision. Rights
of appeal under section 3(4) of the Lands Tribunal Act 1949 and Rules of the
Supreme Court Ord 61 will not accrue until the decision has been thus
completed, ie from the date of the addendum.
Addendum
I have
received written submissions on costs. The authority have been successful in
this reference and I have wholly rejected the claimant’s case. The authority
made a sealed offer at a figure above my award, which was rejected by the
claimant. The claimant has put forward several reasons why he should not pay
all or part of the authority’s costs. I have considered these reasons, but I am
not persuaded that I should depart from the normal rule that costs follow the
event. I order that the claimant shall pay the authority’s costs of this
reference, such costs, if not agreed, to be taxed by the registrar of the Lands
Tribunal on the High Court standard basis. I have no power to order costs in
respect of the necessary wayleave hearing.
Annex A
Valuation of
Michael Hope BSc FRICS ASVA for
the claimant
|
1. Valuation without scheme |
|
|
|
|
|
34.5 acres @ £450,000 |
|
|
£15,525,000 |
|
|
2. Payments due: with scheme — |
||||
|
(i) Minimum payment for |
|
|
|
|
|
2.7 acres pylons and line @ |
£1,215,000 |
|
|
|
|
(ii) Injurious affection based |
|
|
|
|
|
12.5% of 10.4 acres @ £450,000 |
£585,000 |
|
|
|
|
3% of 21.4 acres @ £450,000 per |
£288,900 |
|
|
|
|
Additional fencing costs 864m @ £30 per m |
£25,920 |
|
|
|
|
Subtotal under Turris |
£2,114,820 |
|
|
|
|
plus |
|
|
|
|
|
(iii) Injurious affection from |
|
|
|
|
|
above 0.2 microteslas |
|
|
|
|
|
87.5% of 10.4 acres @ £450,000 |
£4,095,000 |
|
|
|
|
(iv) Restriction in building |
|
|
|
|
|
50% less 3% of 21.4 acres @ |
£4,526,110 |
|
|
|
|
3. Compensation claim existing use |
|
|
£10,735,920 |
|
|
4. Valuation of site with scheme |
|
|
£4,789,080 |
|
|
|
|
|
|
|
|
Annex B |
|
|
|
|
|
Valuation |
|
|
|
|
|
1. Capitalised rent |
|
|
|
|
|
Rents pylon ZL 399 |
£28.57 |
|
|
|
|
ZL 400 |
£28.14 |
|
|
|
|
|
£57.14 |
|
|
|
|
YP 15 years @ 5% |
10.38 |
|
£593.11 |
|
|
2. Capitalised compensation |
|
|
|
|
|
Rents pylon ZL 399 |
£48.23 |
|
|
|
|
pylon ZL 400 |
£60.18 |
|
|
|
|
|
£108.41 |
|
|
|
|
YP 15 years @ 5% |
10.38 |
|
£1,125.30 |
|
|
3. Injurious affection |
|
|
|
|
|
Residential value: |
|
|
|
|
|
2 plots @£110,000 |
£220,000 |
|
|
|
|
Proportion of value 30% |
£66,000 |
|
|
|
|
Injurious affection 5% |
£3,300 |
|
|
|
|
less: value after 15 years |
|
|
|
|
|
£3,300 × PV of £1 in 15 years @ |
£1,587 |
|
£1,713.00 |
|
|
Compensation |
|
|
£3,431.41 |
|
|
|
|
|
|
|
