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Compensation For Land Taken

The following is a brief outline of the relevant compensation law; it is not a comprehensive guide, for specific information contact Property Taxation Specialists.

  • The Valuation date. Following the P&CPA 2004 the earlier of;
    1. the date when possession is taken,
    2. the date when compensation is agreed,
    3. or the date when compensation is determined by the Lands Tribunal.

For equivalent reinstatement it is the date reinstatement first becomes reasonably practicable.

  • Basic “rules” of compensation, are set out in the LCA 1961 as amended by the PCA 1991. In summary they are;
    1. No allowance is made for the acquisition being compulsory.
    2. The value will be market value except as set out in [3] and [6] below.
    3. The special suitability of land for a statutory purpose or use will not be reflected in the value paid.
    4. No illegal, immoral or unsocial uses of the land, that might affect value, will be taken into account.
    5. Where land is devoted to a purpose for which there is no general market, subject to the Lands Tribunal being satisfied that reinstatement is intended, compensation may be assessed on the basis of equivalent reinstatement.
    6. The provisions of rule 2 shall not affect the assessment of disturbance compensation or any matter not directly based on the value of the land.
  • There are a number of modifications to the basic rules, which are in summary.
    • The effect of the statutory scheme on value is ignored.
    • Betterment of any land retained by the vendor is offset against the compensation.
    • Any depreciation of the land taken by the scheme or intended acquisition is ignored.
    • There are a number of other specific modifications in particular circumstances.
  • There are specific planning assumptions to be made which are complex and contained in sections 14-16 LCA 1961, and subsequent legislation. They are too complicated to be set out here.
  • Where no general planning consent can be identified or assumed the acquiring authority or relevant planning authority can be required to provide a certificate of alternative development per section 17 LCA 1961.
  • For the services offered by Property Taxation Specialists see Compulsory Purchase Services.
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