There are recent and upcoming changes to the compulsory purchase process – here are some key pitfalls of which claimants should beware
When the government introduces legislative changes to an area of law notorious for being draconian and difficult to navigate, it is hoped that such changes will simplify and update the law to fit with modern times. The law of compulsory purchase is one of those areas.
The most recent change (made on 22 September 2017) was the issue of an updated model compensation claim form, together with supporting guidance notes. These comprise an update to the government’s CPO guidance document, Compulsory Purchase Process and the Crichel Down Rules, published in October 2015.
What is the intention behind the model claim form?
As stated on the government’s website, the intention of the model form is “to streamline the process of claiming and assessing the compensation due to those who are affected by compulsory purchase”. This new addition advises acquiring authorities to send claim forms to potential claimants at the earliest opportunity and encourages claimants to complete and return it as early as possible, albeit that the form can be updated or supplemented by negotiations between parties.
The main intention of the claim form appears to be to offer assistance to claimants in complying with the provisions of section 4 of the Land Compensation Act 1961, which require that compensation claims are detailed and properly evidenced.
The claim form guidance emphasises that failure to provide sufficiently detailed information to the acquiring authority to allow it to make a proper compensation offer could result in the risk of an award of costs against a claimant if a reference is made to the Lands Chamber of the Upper Tribunal (the legal forum where disputed compensation claims are assessed).
Does the new form make it easier and fairer for claimants?
Given that it largely replicates the old-style form of claim, the need for the model claim form is debatable. Nonetheless, if use of the new form is adequately enforced and becomes a standard process within compulsory purchase, this could help to speed up negotiations, particularly if they are sent out early.
The claim form is particularly detailed and, without proper professional advice, less experienced landowners may find it difficult to complete the level of information requested. It would appear that the form very much favours the competently advised claimant, which could unfairly disadvantage those claimants lacking access to advisers experienced in CPO.
The main take-home point from the new claim form is the importance of ensuring that claimants use it, seek sound professional advice in completing it and return it to the acquiring authority as early, and in as detailed a manner, as possible. It may assist with streamlined compensation claims, but ill-advised claimants who fail to utilise it properly may find themselves in a difficult situation should a claim reach tribunal.
What other changes to CPO are due?
The Neighbourhood Planning Act 2017, which received royal assent on 27 April 2017, will have a number of wide-ranging implications for the compulsory purchase system. At present, not all the CPO provisions contained within the new act have come into force, with no indication by the government as to when they will be appointed. The following statutory provisions, which are of key importance, will require specific legal instruments to bring them into force.
Most notably, the act introduces the ability for authorities to acquire land on a temporary basis; a power that has been well utilised within the development consent order regime but has remained absent from the compulsory purchase procedure. This power will be welcomed by acquiring authorities when it comes into force, allowing, for example, land required for a construction compound to be acquired on a temporary basis.
Another key area set to alter under the Neighbourhood Planning Act 2017 relates to the repeal of part 4 of the Land Compensation Act 1961.
The new act will remove the ability to make an additional compensation claim where a subsequent grant of planning permission increases the value of acquired land. The result will be that where a planning decision is made granting consent for more valuable development on acquired land within 10 years of completion of a CPO, a claimant will be prohibited from claiming additional compensation.
One lauded change under the new Neighbourhood Planning Act, which took effect from 22 September, is the enshrinement of the “no-scheme” rule, often referred to as the Pointe Gourde Principle, in statutory code. This rule requires value to be assessed on the basis of a state of affairs that would have existed if there had been no scheme; in other words, any change in the land value caused by the scheme, or the prospect of it, must be disregarded.
Debbie Reynolds is a planning associate at TLT, a member of the Compulsory Purchase Association and a legal associate of the Royal Town Planning Institute