New clause 17 - Assessment of compensation: valuation date
Planning and Compulsory Purchase (Re-committed) Bill
6:15 pm
Mr Geoffrey Clifton-Brown (Cotswold, Conservative)
I was not looking forward to this part of the Bill, because it deals with a pretty difficult subject. Only those with an everyday involvement in compulsory purchase have a good working knowledge of it. I have not been involved in it for a long time.
I welcome the Minister's explanation and his clarification of the relevant valuation date. The law is at present confused on the subject, but new clause 17 appears to clear up case law. For example, in the 1991 case of Hughes v. Doncaster metropolitan borough council, in All England Law Reports No. 295, it was stated that the value of land includes both its market value and any compensation for disturbance. This is a difficult concept. People often get wind of compulsory purchases and various speculative developers buy up the land with a view to increasing its value merely because it is about to be compulsorily acquired.
A case from 1955—Lambe v. Secretary of State for War, heard in the Queen's bench division and recorded in All England Law Reports No. 386—clearly states that the increase in value due to the scheme is never to be taken into account. It seems that there is some confusion. Indeed, in some notable cases speculators have bought land and made a considerable profit as a result. Although the new clause provides some clarification, I am not sure that it entirely deals with the matter. Nor am I sure how one could do so, because of speculation about compulsory purchase orders long before they are made. I do not know how we can prevent such speculation, but I would welcome further clarification.
I am not entirely clear as to when one would go down the route of notice to treat and when to go down the route of general vesting. I presume that the notice to treat route is an earlier occurrence and therefore less likely to be subject to the speculation that I have described than the vesting route. General vesting occurs when the acquiring authority takes possession; notice to treat occurs when the acquiring authority starts discussion of that land. Again, that gives manipulative speculators the chance to make money at the state's expense, which is not desirable.
I welcome the clarification in new clause 18 on exactly whose interest in land can be taken into account.