Compulsory purchase – Notice to treat – Time limit – Section 5(2A) of Compulsory Purchase Act 1965 – Acquiring authority serving notice to treat in respect of compulsory acquisition of claimant’s land – Notice to treat expiring after three years – Acquiring authority serving notice of reference to Lands Tribunal – Negotiations regarding compensation continuing – Whether claimant waiving right to rely upon expiry of notice to treat – Whether unconscionable to permit such reliance – Preliminary issue determined in favour of claimant
Under a compulsory purchase order made in 1997, the acquiring authority was authorised to acquire certain land in order to extend the tramway system in Manchester. The land was then owned by the claimant’s predecessor. The acquiring authority served a notice to treat on 8 May 2002. Negotiations to assess the compensation payable to the landowner failed. On 16 May 2005, the acquiring authority served a notice of reference to the Lands Tribunal (LT) for the determination of the compensation while continuing discussions with the then landowner and, subsequently, with the claimant, which acquired the land in January 2006.
In January 2007, the claimant asserted for the first time that the LT proceedings were invalid. It contended that the acquiring authority could no longer rely upon the 2002 notice to treat, which had ceased to have effect by operation of section 5(2A) of the Compulsory Purchase Act 1965 because more than three years had passed since service and the acquiring authority had not made a reference to the LT nor carried out any of the other steps set out in section 5(2A). The acquiring authority did not dispute that the notice of reference had been given outside the three-year time limit. However, it contended that the time limit had been waived, or the claimant was estopped from relying upon it, by virtue of its and the previous landowner’s conduct in proceeding with negotiations after they should have been fully aware of their right to raise that issue. The acquiring authority submitted that it would be unconscionable to permit the claimant to rely upon the failure to make the reference within the three-year period.
Held: The preliminary issue was determined in favour of the claimant.
Neither the claimant nor its predecessor in title could be said to have made an election between alternative, inconsistent rights so as to give rise to a waiver of one of them. Whether to advance a particular defence in the instant proceedings did not involve an election of that kind: Kammins Ballrooms Co Ltd v Zenith Investments (Torquay) Ltd (No 1) [1971] AC 850 considered.
Nor was there any waiver in the nature of an estoppel. Unconscionability was an essential element in estoppel and that was absent in the instant case: Cobbe v Yeoman’s Row Management Ltd [2008] UKHL 55; [2008] 35 EG 142; [2008] 36 EG 142 applied. The issue had to be considered in the context of the 1965 Act, which made specific provision for both limiting and extending the period of validity of the notice to treat and imposed particular requirements upon the acquiring authority. It was the duty of that authority, once the three-year period had elapsed on 8 May 2005, to give immediate notice to the landowner that the notice to treat had ceased to have effect. It failed to do so; nor had it sought the claimant’s agreement to extend the period using the procedure permitted under the Act. Instead, it had merely served the landowner with an invalid notice of reference. There was no evidence that the previous landowner had been aware that the notice of reference was, as a matter of law, out of time, or that the claimant had had such knowledge before January 2007. The claimant had done nothing after that date to suggest that it was treating the notice of reference as having been validly made. In those circumstances, it was not possible to imply an extra-statutory agreement on the part of either the claimant or its predecessor in title to an extension of the three-year period. Moreover, section 5(2B)(b) provided that such an extension would be for a finite period. The acquiring authority was a victim of its own failure to observe the requirements of the 1965 Act.
Mark Halliwell (instructed by Shammah Nicholls, of Manchester) appeared for the claimant; Ruth Stockley (instructed by the legal department of the Greater Manchester Passenger Transport Executive) appeared for the acquiring authority.
Sally Dobson, barrister
