LCA/43/2004
LANDS TRIBUNAL ACT 1949
COMPENSATION – dwelling house – compulsory acquisition of 25 sq m land being half the road width in front of claimant's property – claim for "outstanding rent and nuisance" following use of road over previous 20 years – basis of claim rejected – compensation for value of land, injurious affection and disturbance £2,550
IN THE MATTER of a NOTICE OF REFERENCE
BETWEEN HOWARD RONALD GHRIST Claimant
and
BLAENAU GWENT BOROUGH COUNCIL Acquiring
Authority
Re: Land at Meron, 5 Cwm Terrace, Cwm, Blaenau Gwent, NP23 7RR
Determination under written representations procedure
by the President
The following case is referred to in this decision:
Stokes v Cambridge Corporation (1961) P & CR 77
DECISION
- This is a reference, originally listed to be heard under the standard procedure, but subsequently transferred by agreement between the parties to the written representations procedure. The claimant, Howard Ronald Ghrist, is the freehold owner of Meron, 5 Cwm Terrace, Cwm, Blaenau Gwent ("the retained property"), a mid-terrace two-storey private dwelling house fronting the north-east side of the road known as Cwm Terrace. Within the title to that property was the sub-soil to half the width of the highway to which it fronts, extending to some 25 sq m. ("the acquired land"). In connection with proposals to construct the Cwm Relief Road, which would take through traffic away from the town centre of Cwm, and for the purposes of carrying out improvements to the existing highways in the vicinity of the new road, Blaenau Gwent County Borough Council ("the council") resolved to acquire the freehold title to a large number of small parcels of land forming the highway, of which the land acquired from the claimant, plot 2/108, was one.
- To facilitate the purchase, the council made the Blaenau Gwent County Borough Council (Cwm Relief Road, Route A4046 Classified Road) Compulsory Purchase Order 2000 which was confirmed by the Minister for Environment to the National Assembly for Wales on 10 January 2002. Notice to treat was served on the claimant on 12 April 2002, notice of entry was served on 15 April 2002, and the land was entered on 9 January 2003, which is the valuation date for the purposes of this determination.
- The claimant filed particulars of claim in answer to notice to treat in the sum of £224,500 on 3 May 2002. The council has offered £2,550.
Background
- The A4046 is the main highway route between Ebbw Vale to the north and, via the A467, Newport to the south. Where the road passed through the centre of Cwm the flow of traffic was impeded by a one-way system through narrow residential streets. On the opposite (south-western) side of Cwm Terrace to the Cwm Terrace houses were the rear yards of houses comprising Station Terrace. The road Station Terrace ran parallel with Cwm Terrace, and the two roads were joined at their south-eastern ends by a short road known as Mill Terrace. At its north-westerly end Station Terrace bent to the north to join the north-westerly end of Cwm Terrace. The A4046 was one-way south-eastwards along Cwm Terrace, south-westwards along Mill Terrace and north-westwards (and then north) along Station Terrace. Sharp junctions between the streets, a large number of accesses and on-street parking impeded the free flow of traffic, particularly heavy goods vehicles.
- The proposal was to improve Station Road and to extend it north-westwards and south-eastwards alongside the railway. It would remove through traffic from the centre of Cwm and residential areas, relieve congestion in the town, and reduce dangers to pedestrians and local motorists. Cwm Terrace would revert to two-way traffic as a local road.
- In order to convert Cwm Terrace to two-way traffic certain highway improvements were required. The council say that these could have been carried under the Highways Act powers without the need to acquire any land. However, having concluded that the freehold owners owned the land to the middle of the highway, the council thought it appropriate to acquire compulsorily the individual parcels and to pay statutory compensation to the owners.
- The contract for the construction of the relief road, which is about 2.7 km in length, was let on 29 April 2002 to Mowlem Construction and the road opened to the public on 6 February 2005.
- Notice of reference to this Tribunal was made by the claimant on 25 May 2004 citing an approximate value of claim at £220,000, and it enclosed the documentation upon which he intended to rely entitled "Part 1: Claim for Outstanding Rent and Nuisance". Mr Richard S Williams BSc MRICS, a caseworker with District Valuer Services, Wales who has been solely responsible for land acquisition in connection with the Cwm Relief Road project, submitted his expert witness report, on behalf of the council, on 15 February 2005. The reference was due to be heard in Cardiff on 25 May 2005, but the hearing was stayed to enable the claimant to take professional advice.
- Subsequently, following an exchange of correspondence, the parties agreed to the matter being determined by written representations in accordance with Rule 27. I then sought any further documentation upon which the parties intended to rely. Mr Ghrist provided a revised claim, stated to supersede all previous submissions, in the sum of £2,500,000 on 19 August 2005, and Mr Williams provided a supplementary report, to be read in conjunction with his original report, on 8 July 2005.
- It is the documentation described in the above two paragraphs upon which I rely.
Claimant's case
- Mr Ghrist had originally said, in para 7 of his submission of 25 May 2004:
"Part 2 of this dispute will deal with compulsory purchase. This submission is a claim for the payment of outstanding rent/nuisance for the plot from freehold purchase, 28 January 1982, until bypass completion in 2005. This must be settled before any CPO negotiations".
He said that all of the terraced properties in Cwm Terrace and the 14 units in Station Terrace included ownership of the road surface. His parents, from whom he had inherited the house, were, he said, almost certainly unaware that the property included the road, but he had been trying to resolve his claim through the town's mayor, his MP, MEP and a member of the Welsh Assembly – all to no avail.
- It was Mr Ghrist's view that he should be entitled to a payment equating to £10,000 pa for the 22 years of his family's ownership of the property to cover rent for the land and compensation for the nuisance that had been suffered due to noise, dust, fumes and pollution from the considerable traffic using the road. The glare from the artificial lighting in the street was also unbearable, and the problems of the road usage rendered parts of his property uninhabitable. In short, he said, "life in the property for more than two decades has been a living hell….my village is little more than a traffic corridor, my only sanctuary is an upstairs middle bedroom where I now live and work." In terms of his human rights, the claimant said that was not only absurd but also clearly discriminatory and unfair for users of the road to benefit from the use of a private asset at a discounted cost, while the owner was left uncompensated.
- In his most recent submission, Mr Ghrist described his claim as compensation to "extinguish easement of way", and made reference to a research paper undertaken for the DETR and entitled 'The Use of Prices in the British Land Use Planning System', together with Article 6 of the Human Rights Act 1998 (Right to a Fair Trial), Article 8 (Right to Privacy and Family Life) and Article 1, Protocol 1 (Right to Peaceful Enjoyment of Possessions). He also referred to the Countryside and Rights of Way Act 2000: A Regulatory Impact Assessment in respect of the Vehicular Access Across Common and Other Land (England) Regulations 2002, made under section 68 of the above Act. These dealt with an apparent anomaly whereby prescriptive rights, which a person might otherwise have obtained after 20 years by driving across common land to their premises, could not be acquired when the activity being undertaken was a criminal offence under the provisions of section 193 of the Law of Property Act 1925 and the Road Traffic Acts 1930 (currently section 34 of the Road Traffic Act 1988). These made it an offence to drive on common (and similar) land without the permission of the owner (save in limited circumstances set out in the 1988 Act). The new Act enabled the owner of the premises to acquire a statutory easement in return for a one-off payment. If an easement was obtained by negotiation the payment might equate to between 0.5% and 2% of the value of their premises. With compulsory purchase, by contrast, private individuals were coerced into handing over their land on terms which, Mr Ghrist felt, amounted to state theft.
- Mr Ghrist said there was a precedent on the issue of compensation for granting an easement – Stokes v Cambridge Corporation (1961) P & CR 77 – where the Lands Tribunal had assessed compensation payable to a landowner at 30% of the development value of the land to be served by that access. He said that current valuation practice is that the costs of such easements can be between one third and one half of the difference between the value of premises with and without statutory access. That could be as much as 10% of the value of the premises. Recognising the need to consider excessive charging for the acquisition of legal rights, the government's objective, he said, was to strike a fair balance between the landowner and the owner of the premises to which access was required
- He then went on to summarise the paper in some detail, and came to the conclusion that it lent considerable support to his revised claim which was based upon his estimate that 50,000,000 vehicles would have crossed the road in the 22 years that he had owned it. At 0.5p per crossing, this would amount to the £2,500,000 he was now claiming.
Acquiring authority's case
- Mr Williams, who has over 15 years experience of the valuation of real property with the Inland Revenue Valuation Office Agency, and has been dealing exclusively with compensation matters, said that he had first become involved with the case, the subject of this reference, in May 2002. After writing to the claimant on 2 May he inspected both the acquired and the retained land on 28 May 2002 in the company of Mr M Russell, a representative of William Ricketts Partnership, Cardiff, the claimant's then agents. Mr Williams said he noted the condition of the claimant's house, which was in need of modernisation and internal refurbishment and also external repair.
- Mr Williams set out in his report the three constituent parts that made up his overall assessment of compensation in the sum of £2,550. Firstly, the price to be paid for the land. Section 5(2) of the Land Compensation Act 1961, provided that " the value of land shall, subject as hereinafter provided, be taken to be the amount which the land if sold in the open market by a willing seller may be expected to realise…" He had been advised the land could not be used for any other purpose than as a public highway and therefore the owner could not gain access to the subsoil beneath. In his view therefore, it had only a nominal value, but the traditional 'peppercorn', or £1, might not be appropriate compensation in 2003. He therefore assessed its "nominal" value at £50.
- Secondly, since part only of the claimant's land was being acquired, he was entitled to compensation for injurious affection and/or severance under section 7 of the Compulsory Purchase Act 1965. That section provided that regard should be had, in addition to compensation for the value of the land, to "the damage, if any, to be sustained by the owner of the land by reason of the severing of the land purchased from the other land of the owner, or otherwise injuriously affecting that other land by the exercise of the powers…" Mr Williams said that, in his opinion, the open market value of the retained land (the house), reflecting its condition at the date of inspection, and in the knowledge that nothing significant had been done to it by the valuation date, was £20,000. He had arrived at this figure on the basis of a number of open market sales that had been effected in the vicinity between 1998 and 2003, and in addition, from the prices agreed in connection with negotiated acquisitions to do with the relief road scheme, all vendors having been professionally represented.
- Although there is no settlement evidence yet available (in connection with compensation for injurious affection) as the relief road was only opened in February 2005, Mr Williams said he had based his assessment on negotiated percentages on properties affected by three other South Wales schemes. In arriving at a suggested figure of 2.5% of the open market value (£500), he said he had taken account of the positive facts that the new road was some 54 metres from the retained land whereas the main road had previously been within 5 metres. It was also forecast by Capita Gwent Consultancy (now Capita Symonds) that traffic flow in Cwm Terrace would reduce by about 30%, despite it reverting from one-way to two-way traffic post-scheme. However, no data capable of constructive analysis was yet available. There were no changes to the street lighting pre- and post-scheme, and parking facilities had, if anything, improved by the provision of 12 marked bays adjoining nearby St Paul's Hall. On the negative side, there were now two bus stops in Cwm Terrace and it could be argued that the two-way traffic may be detrimental in some respects as compared to a one-way system past the claimant's property. Putting everything in the balance, Mr Williams said, he felt 2.5% of the value of the property was fair compensation under this head.
- Thirdly, the claimant was entitled to receive compensation in respect of disturbance. No itemised claim for disturbance had been forthcoming from Mr Ghrist, and in Mr Williams's view the only matter that could possibly fall under this head of claim would be nuisance caused by and during the construction of the new road. In the light of the fact that the claimant's property was only marginally affected by building works during the early stages of construction, he said he had assessed a figure of £2,000 as being appropriate having regard to a number of agreements that he had personally negotiated in respect of three other major road schemes (a schedule of which he produced). He said that the figure could be devalued as:
10 months inconvenience at £25 per month £ 250
23.5 months inconvenience at £75 per month £1,763
£2,013 – say £2,000
- Alternatively, Mr Williams said that, admittedly without the benefit of evidence, he considered how much the rental value of the property might have been abated during the course of the works. In his opinion, the property would have a rental value of no more than £250 per calendar month in its unmodernised state, and at an arbitrary discount of 25% (£62.50) to reflect inconvenience caused by the works, this produced a figure covering the 33.5 months contract duration, of £2,094. In support of his conclusion that £2,000 was fair compensation for disturbance, Mr Williams set out, in his supplementary report, details of the noise disturbance and effects of dust and pollution that might have affected the residents of Cwm Terrace during the construction process emanating from the piling works for the new road, demolition of some nearby buildings and the effects of temporary traffic lights in the street. He said that the works actually effected within Cwm Terrace were de minimis and principally extended to resurfacing that was not undertaken until after the new road had actually opened. In his view, in assessing this figure, he had given the claimant considerable benefit of the doubt.
- The full extent of the council's offer could therefore be summarised as :
Compensation for land taken £ 50
Compensation for injurious affection £ 500
Compensation for disturbance £2,000
Total £2,550
Conclusions
- Mr Ghrist's claim seeks compensation for the use of Cwm Terrace as a through route and the disturbance that this caused to him over the 20 years before the new road scheme. That, however, is not a claim that arises out of the compulsory acquisition of his land. The Tribunal's jurisdiction is confined to determining, as at the date of entry, the value of the land acquired and any additional loss arising from injurious affection or disturbance in consequence of the acquisition.
- In my view, the statutory bases upon which compensation is payable have been properly addressed in Mr Williams' evidence. I am satisfied that he has taken care in his assessments under the three heads, and I note that no evidence has been produced by the claimant to disprove his figures.
- In the light of the evidence before me, I determine that the compensation payable to the claimant is £2,550 together with statutory interest from the date of entry. This determines the substantive issues in this case and it will take effect as a decision when the question of costs has been determined. A letter about that accompanies this decision.
Dated 27 September 2005
George Bartlett QC, President
