19 Jul 23 by Greg Oldrieve
What does a Compulsory Purchase Order mean?
Compulsory purchase is often quite a daunting and emotive issue. Public authorities have the power under various statutes to acquire landed interests (including buildings, and thus houses too) that are needed in order to fulfil their statutory duties. Examples include the Highway Authorities’ right to acquire land to construct roads and Local Authorities for urban regeneration projects. Vickery Holman have, and are currently, advising both property owners and acquiring authorities in this regard.
So what does a Compulsory Purchase Order actually mean for you – and what about Compensation?
Compulsory Purchase and Compensation
Each project (scheme) has to have a specific Compulsory Purchase Order (CPO) granted by the government. To achieve a CPO the authority has to prove the project is in the public interest and that it has exhausted all other means of acquisition i.e. negotiations. Affected parties can contest the provision of a CPO and the Secretary of State has the power to call for a public enquiry where it is felt necessary.
The price paid for land acquired under a CPO is the damage suffered by the owner / occupier (compensation). This includes the value of their landed interest taken plus any diminution in the value of their retained interests e.g. where part of a house’s garden is required to widen a road and the retained house is adversely affected by the increase in traffic noise from the road. Where the scheme brings benefit (betterment) to the owner / occupier’s retained interest these would be offset against any losses. In valuing land taken it ignores “the scheme” for better or for worse.
Other damages could include loss of profits where a business operates from the property. Related fees such as surveyors and lawyers acting for the owner/occupier, and time incurred in dealing with the sale.
Any claim is inflated by Statutory Loss Payments, which are intended to sweeten the tribulations of the owner / occupier in being subject to a CPO.
Public authorities are reluctant to use CPO and endeavour to agree purchases by negotiation but use the CPO framework as the measure of the price to be paid.
To talk to Vickery Holman about Compulsory Purcahse Orders and what they eman for you, please contact us.