Land compulsorily purchased — Held for a new town — Land passed to the commission for disposal — Negotiations with previous owner — Guidelines on disposal of land — Whether statutory duty to obtain best consideration reasonably obtainable overrides guidelines — Whether decision to put sale of land out to tender can be reviewed
In November 1974 an area of land owned by the appellants, and adjoining further land owned by them, was compulsorily purchased in connection with the development of a new town nearby. The subject land remained as agricultural land, part of it being farmed by one of the appellants as a licensee. In August 1984 the development corporation wrote to the appellants that as the land was surplus to their requirements, they were prepared to enter into negotiations for the sale of the land. This was in accordance with guidelines issued in 1983 by the Department of the Environment, and consistent with “Crichel Down” considerations, that former owners should generally be given an opportunity to repurchase land previously in their ownership. In April 1985 the assets and land of the development corporation, including the subject land, passed to the Commission for the New Towns under sections 35-36 of the New Towns Act 1981. Planning permission for some of the land became a possibility and in late 1987 this was granted in outline; negotiations were suspended with the appellants.
Sections 36-37 of the New Towns Act 1981 were amended by the New Towns and Urban Development Corporations Act 1985; the substituted section 37(3) stating that the commission “shall not … (e) dispose of any property … for a consideration which is less than the best reasonably obtainable, except under the general or special authority of the Secretary of State”. The respondent commission believed it had a duty to obtain the best price for the land and that this could only be achieved by putting the land up for sale by tender. That view was formed mainly on the professional advice given to the commission. The appellants’ application for judicial review of the decision to sell by tender was dismissed by Kennedy J ([1988] EGCS 14).
Held 1. The 1983 guidelines, which advised that surplus land be offered back to the former owners, cannot be taken as a general authority of the Secretary of State for the Environment under section 37(3) of the 1981 Act to sell without going to open tender.
2. Parliament, in enacting section 37(3) of the 1981 Act as it is today, had not thrown the 1983 guidelines and all “Crichel Down” considerations out of the window. The change of attitude by the commission, and its decision to sell by open tender, was related to the particular circumstances of the sale in issue and was the result of advice received by the commission’s surveyors; there was a difficulty in valuing development land in a buoyant market.
3. The statutory duty to obtain the best reasonably obtainable consideration followed similar wording in the Settled Land Act 1925. The expression means the highest price in money that can be got, and on the evidence of the state of the market the commission were entitled to proceed as they did.
4. With land for which there is a reasonably stable market, such as agricultural land, there should be no difficulty in putting a value on the land and offering it back to former owners in accordance with the guidelines.
Buttle v Saunders
[1950] 2 All ER 193 referred to.
Derek Wood QC and David Holgate (instructed by Nabarro Nathanson) appeared for the appellants; and Jeremy Sullivan QC and John Furber (instructed by D J Freeman & Co) appeared for the respondent commission.
