Compulsory Purchase Compensation

February 22nd, 2017

In Homes and Communities Agency v J S Bloor (Wilmslow) Ltd (2017) UKSC 12 raised questions concerning the Pointe Gourde or “no-scheme” rule, by which compensation for compulsory acquisition is to be assessed disregarding any increase or decrease in value solely attributable to the underlying scheme of the acquiring authority.  The particular issue concerned the relationship between the general provisions, in the Land Compensation Act 1961, as explained and expanded by judicial interpretation, for the disregard of the scheme, and the more specific provisions relating to planning assumptions.

The Supreme Court reversed the decision of the Court of Appeal and reinstated that of the Upper Tribunal. The Tribunal were entitled to regard the underlying policies, including the allocation in the development plan, as potentially relevant also to the development apart from the scheme.  The assessment of their significance in the no-scheme universe was pre-eminently a matter for the Tribunal.  They did not ignore potential policy considerations. Their reasoning disclosed no error of law.

The right to claim for potential development value is long established. The specific statutory provisions relating to planning assumptions do not preclude account being taken under the general law of the prospect (certain or a hope) of planning permission for valuable development.  Moreover, the application of the Pointe Gourde principle may result in changes to the assumed planning status of the subject land.  The application of the general law may produce a more favourable result for the claimant than the statutory planning assumptions.

The Supreme Court concluded that the Upper Tribunal’s decision in this case was a powerful illustration of the potential complexities generated by the by the 1961 Act in its unamended form. It was to be hoped that the amendments currently before Parliament will be approved.

 

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