Housing Act 1957–Clearance area–Appeal against compulsory purchase order–Allegation that council intended to rehabilitate properties, but wished to acquire them cheaply–Challenge to validity of order not justified–Council acted properly and order was properly confirmed by Secretary of State–Deputy judge’s decision dismissing appeal upheld by Court of Appeal
This was an
appeal by Randhir Singh Wahiwala, Avter Singh Bhaker and Jeet Singh, owners of
four houses in Clarence Road, Peterborough, against the dismissal by Sir
Douglas Frank QC, sitting as a deputy judge of the Queen’s Bench Division, of
their application to quash the City of Peterborough (Gladstone District Study
Area) (No 3) Compulsory Purchase Order 1973 for the acquisition of their houses
as houses in a clearance area unfit for human habitation and intended for
demolition.
Barry Payton
(instructed by Allan Jay & Co, agents for J Hunt & Co, of Peterborough)
represented Mr Wahiwala, and, with Miss Clare Renton, Singh Bhaker and Jeet
Singh; Harry Woolf (instructed by the Treasury Solicitor) appeared for the
Secretary of State; and Patrick Ground (instructed by Michael Edward Pearson,
Town Hall, Peterborough) represented the city council.
Giving
judgment, LORD DENNING MR said that Peterborough had a real problem in the
Gladstone district, which had a large immigrant community and a number of
houses in a deplorable condition. About 126 of 2,400 dwellings were unfit for
human habitation and incapable of being made fit at a reasonable cost. They
included the applicants’ houses, which were back-to-back and over 100 years
old. A ministry inspector’s report said that the most satisfactory method of
dealing with them was demolition. So it was a proper case for the council, in
June 1973, to resolve that the area should be a clearance area under section 42
of the Housing Act 1957 and that all the buildings should be demolished.
In the
ordinary course there would have been a compulsory purchase order–as there
was–which would have to be confirmed by the minister–as it was, and then
demolition of the houses. The owners would be found other places and would be
paid compensation at cleared site value, since the houses were worth nothing.
Dates were significant. On June 29 1973 there was the resolution making it a
clearance area. On September 27 the compulsory purchase order was made,
followed by a statutory notice leading to an inquiry before an inspection in
September 1974, and in July 1975 confirmation of the order by the minister. So,
on the face of it, everything was done according to law. But the procedure had
been attacked on behalf of the owners. It was said that the council did not really
intend to demolish the houses; that they had another plan–not to pull down the
houses but to rehabilitate them; and that that plan was such that they should
have gone by the procedure for rehabilitation, paying considerably more
compensation. What really mattered was the compensation.
Mr Payton had
referred to matters which went on while the statutory procedure was in
progress. It started with a letter to the householders from Mrs Swift, chairman
of the council’s social services committee in November 1973, saying that the
council was contemplating rehabilitation by a housing association as a possible
proposition. One paragraph read: "You will appreciate that all this will
cost a great deal of money, and we could not possibly do it unless we were successful
in our compulsory purchase order. We also have a problem in that at this
present time we have not sufficient manpower . . . to carry through such a
scheme ourselves." The suggestion
was that that was a device (it was not called lack of bona fides) by which the
council would get the houses cheaply and if they paid so little they would have
the money to rehabilitate. The attack was supported by council and committee
minutes between November 1973 and July 1974, when a district plan had been
published for discussion in which the particular area was shown coloured for
rehabilitation and not for demolition. But from the text it was clear that it
was only a suggestion about what might be feasible if all the properties were
in a single ownership.
It was plain to
him (his Lordship) that that was not a positive scheme for rehabilitation but a
suggestion thrown out before the inspector held his inquiry. The inspector
overruled the submission that the council did not intend to demolish but to
rehabilitate, so that they could not lawfully go on with the compulsory
purchase order; and the minister and the deputy judge also overruled it.
Clearly on the material before the inspector the original resolution of the
council still applied and the rehabilitation suggestion was only an alternative
which might have materialised if section 114 of the Housing Act 1974 had been
in force before the compulsory purchase order was made. But the suggestion was
dropped by the time of the inquiry. When therefore the original order was confirmed
by the minister, the law had to take its course and it thereupon became the
duty of the council to demolish under section 47 of the 1957 Act, although they
could postpone demolition under section 48.
The court had
been referred to a number of cases including Ashbridge Investments Ltd v
Minister of Housing and Local Government [1965] 1 WLR 1320 on which Mr
Woolf relied for the statement of the principles on which the court could
interfere with a minister’s decision on compulsory acquisition.
Mr Payton had
relied on London and Westcliff Properties Ltd v Minister of Housing
and Local Government [1961] 1 WLR 519 where a compulsory purchase order had
been quashed after it had been confirmed by the minister because there had been
an agreement between the council and the freeholders before confirmation. But
that case had been decided before Ashbridge. The real ground for the
decision
the court upsetting the order. But in the ordinary way if an invalid agreement
was made or another intention was formed the minister could take that into
account but still confirm the order, saying that the agreement was not to be
operated or the intention implemented at all.
So even if
there was anything wrong before the minister confirmed the order–and he (his
Lordship) did not think there had been–that would not render the compulsory
purchase order invalid in any way. The attack on it failed and the appeal
should be dismissed.
Agreeing,
GEOFFREY LANE LJ said that the covert attack on the council was not justified.
Despite the Westcliff decision, he doubted whether an agreement by which
a council had bound itself to embark on a course contrary to the law obliged in
itself the Secretary of State to instruct the council to disregard the
agreement and act in accordance with the 1957 Act. But those circumstances, in
his view, did not arise in the present case.
Even if at the
inquiry the local authority said that it might be better to rehabilitate than
demolish, the Secretary of State would certainly take that into account.
Indeed, in those circumstances, it would be unlikely that he would confirm the
order, but he might and if he did then it was incumbent on the authority to act
in accordance with the statute. He (his Lordship) was by no means satisfied
that the council was trying to get the best of both worlds–to buy at site value
and then rehabilitate. On the legislative stocks at that time was the Housing
Bill of 1974, and the possibility of rehabilitation under section 114 of the
1974 Act, when it became law, might well have been in the council’s mind when
the suggestion about rehabilitation was made, but there was nothing
reprehensible in that. It was clear that the possibility of rehabilitation was
by way of a contingency plan only to be operated if the particular
circumstances arose, which in fact they never did. What the local authority did
from start to finish was frank and open. It acted legally, diplomatically and
thoughtfully. It invited discussion, and the open way in which the whole matter
was dealt with by way of letters to the claimants destroyed the wounding
suggestion that it had been at fault.
CUMMING-BRUCE
LJ also agreed that the appeal be dismissed.
The appeal
was dismissed with costs.