MARY-JO JOYCE v ST ALBANS DISTRICT COUNCIL ACQ/51/2004

UPPER TRIBUNAL
LANDS CHAMBER
ACQ/51/2004Case No ACQ/51/2004
Between
MARY-JO JOYCEApplicantST ALBANS DISTRICT COUNCILRespondent
Before
N J Rose FRICSGuy Williams (instructed by Head of Legal and Democratic Services, St Albans City and District Council) for Acquiring AuthorityVenue Procession House, 110 New Bridge Street, London EC4V 6JLHearing 22, 25-26 and 28-29 July 2005Property: 20 Marlborough Road, St Albans, Hertfordshire AL1 3XQCatchwords: COMPENSATION – compulsory purchase – dwelling house in dilapidated condition – value by reference to subsequent sale or by residual valuation – whether compensation based on actual condition should be increased to reflect acquiring authority’s approach to renovation grant application or the indication of forthcoming compulsory acquisition – whether claimant entitled to home loss payment – Compensation awarded £240,000 – Land Compensation Act 1961 s9 and s5, rule (6) – Land Compensation Act 1973 s30.
[1]This is a reference to determine the compensation payable to Miss Mary-Jo Joyce (“the claimant”) by St Albans District Council (“the acquiring authority”) for the freehold interest in a dwelling house known as 20 Marlborough Road, St Albans, Hertfordshire, AL1 3XQ (“the subject property”), compulsorily acquired under the St Albans District Council (20 Marlborough Road) Compulsory Purchase Order 2000 (“the CPO”). The CPO was made on 11 April 2000 and confirmed by the Secretary of State for Transport, Local Government and the Regions on 20 August 2001 after a 12 day public local inquiry, at which the claimant was the only statutory objector. The claimant challenged the validity of the CPO and, after a 2 day hearing before Maurice Kay J. in the Administrative Court, her application was dismissed on 17 October 2002 and the judge refused permission to appeal. A subsequent application to the Court of Appeal for permission to appeal was dismissed by Mummery L.J. after an oral hearing on 17 March 2003.[2]The acquiring authority made a general vesting declaration on 4 September 2003. This vested the subject property in the acquiring authority on 11 October 2003, which is the agreed valuation date. The claimant appeared in person at the public local inquiry, the Administrative Court and the Court of Appeal. She also appeared in person at the hearing of this reference.[3]Both the amount of the total compensation claimed by the claimant and the figure suggested by the acquiring authority changed during the course of the proceedings. By the end of the hearing, however, the amounts were £455,468.75 and £219,468.75 respectively. Both figures included an agreed surveyor’s fee of £1,468.75 including VAT.[4]By arrangement with the parties I made an unaccompanied external inspection of the subject property and the surrounding area on the morning of 16 August 2005. Facts[5]In the light of the evidence I find the following facts. The subject property has a total site area of 397m2 and is situated in a mainly residential street close to the commercial centre of St Albans. It is diagonally opposite New Kent Road, which gives access to a multi-storey car park serving The Maltings shopping centre. The subject property falls within the St Albans Conservation Area, but there has been infill residential development in the immediate neighbourhood, including Milliner’s Court, a development of flats and town houses close to the rear boundary. Marlborough Road is a one-way street, and parking in the road is restricted.[6]At the valuation date the subject property comprised a Victorian mid-terrace house, constructed in brick under a pitched slate roof. The two-storey rear extension was built in similar materials and had a lean-to conservatory attached. The accommodation comprised an entrance hall, two reception rooms, kitchen and conservatory on the ground floor; two bedrooms, bathroom and separate wc on the first floor and one reception room and kitchen in the basement. The house stands back from the pavement on the eastern side of the road behind 3 a front garden. It includes an archway along its southern side giving access to the rear garden. 18 Marlborough Road has the flying freehold over this archway and the owners of 16 and 18 Marlborough Road have pedestrian rights of way through the archway to their rear gardens.[7]No work was carried out to the property after the claimant purchased it in 1981, apart from some temporary roof repairs in 1984 and its condition deteriorated over the years. On 26 November 1992 the claimant was served with an abatement notice under s 80 of the Environmental Protection Act 1990, requiring work to the roof to prevent rain penetration. The claimant applied for a renovation grant in 1994 to enable her to carry out the necessary works and, on 12 March 1998 the acquiring authority agreed to make a grant of £42,520.96. One of the statutory conditions of the grant approval was that the works must be completed within 12 months. In a letter to her solicitors dated 12 February 1999 the claimant was informed that the acquiring authority was “prepared to revise the grant figure based on new estimates”, but that any costs above the grant limit of £50,000 would have to be borne by her.[8]Although the time limit for carrying out the grant-aided works was subsequently extended beyond the statutory 12 months, the acquiring authority eventually concluded that the only way of ensuring that the subject property was made fit for habitation was to acquire it compulsorily. By that time there had been significant water penetration throughout the building as well as an accumulation of pigeon droppings. The timber and plasterwork had decayed badly and all internal services required replacement.[9]After taking possession, the acquiring authority arranged for the subject property to be offered for sale in two lots. The freehold interest in the first lot, that part of the rear garden which lies behind the rear gardens of 16 and 18 Marlborough Road, with an area of approximately 138m2, was sold for £8,000 on 23 June 2004 to the owners of No.18. The remainder was sold on 7 July 2004 for £253,250, plus £2,000 towards the vendor’s costs. The purchasers of this lot obtained a lease for 99 years and undertook to execute specified works to make the property fit for human habitation. On satisfactory completion of those works the lessee would be entitled to acquire the freehold interest for £1. Issues[10]There are three principal issues between the parties. The first is the freehold value of the subject property in its dilapidated condition at the valuation date. The claimant’s expert assesses this value at £270,000 and the acquiring authority’s valuer puts it at £218,000. Secondly, the claimant contends that, in the absence of the CPO, the property would have been in a refurbished condition. She is therefore entitled to the difference between the value in that condition and the value in the property’s actual state. Her expert estimates that difference at £150,000, which is claimed under s9 of the Land Compensation Act 1961 (“the 1961 Act”). In the alternative, the claimant claims compensation under rule 6 of s5 of the 1961 Act in the sum of £50,000, being the amount of the renovation grant which she says she would have received if her property had not been acquired compulsorily. Architects fees are also claimed under this head, although their amount was not specified. Thirdly, the claimant seeks a home loss payment and the acquiring authority denies that she is entitled to any such payment. 4 Value of freehold in disrepair[11]The claimant’s expert witness was Mr Alexander Brett Walker, BA(Hons) FRICS MRTPI, principal of Messrs Brett Walker of Epping, Essex. He considered that the best evidence of the value of the subject property at the valuation date was provided by the subsequent sale of the leasehold interest for a total of £255,250, together with the freehold sale of the remaining garden for £8,000. The Land Registry index of property prices for terrace houses in the AL13 postcode area showed that the average price increased by 2.34% between the fourth quarter of 2003, which includes the valuation date, and the second quarter of 2004, which includes the dates in June when the rear garden land was sold and the successful offer was made for the lease. If the total proceeds of sale are adjusted back to the valuation date in line with the index, a value of approximately £257,250 is arrived at. Mr Walker rounded this figure up to £260,000 to reflect the added flexibility afforded by a freehold interest compared with a lease. He added a further £15,000 for hope value in respect of the garden area, which was sold subject to a covenant to use it only as domestic garden land appurtenant to 18 Marlborough Road and not to erect upon it any buildings other than one garden shed and/or greenhouse. Mr Walker thus arrived at a valuation of £275,000.[12]Mr Walker also prepared a residual valuation. He considered that, when refurbished, the subject property would have been worth £425,000. From this figure he deducted £130,000 for building costs, fees and profit, to arrive at a site value of £295,000. In his written report dated 1 April 2005 Mr Walker expressed the view that the substantial difference between that figure and the eventual proceeds of sale, when indexed back, was explained by the need to adjust the latter for the fact that the property was disposed of on a leasehold basis; that the rear garden area was sold with a restricted use and that the leasehold interest was marketed within a very tight period on the basis of sealed offers. If these adjustments were made to the sale proceeds, one again arrived at a value of £295,000. In the course of his oral evidence in chief, Mr Walker reduced his valuation from £295,000 to £275,000. He explained that, as a result of discussions with the acquiring authority’s expert about the manner in which the subject property had been marketed, he had been persuaded that, by the time the lease was granted in July 2004, the property had been adequately exposed to the market. Towards the end of the hearing, Mr Walker further reduced his valuation to £270,000, to reflect the fact that publicity had been given to a proposed traffic management scheme which could have had an adverse effect on properties in Marlborough Road at the valuation date. In the event, this proposal was not implemented.[13]Mr Guy Williams, counsel for the acquiring authority, called valuation evidence from Mr A M Woodgate BA (Hons) Dip Land Admin MRICS, partner in Rumball Sedgwick of St Albans, who produced three written reports. The first was addressed to the acquiring authority, who in October 2003 had requested a valuation of the subject property excluding the area of garden behind Nos.16 and 18. Mr Woodgate inspected the property on 13 October 2003 and, ten days later, reported that in his opinion the market value of the freehold interest was £185,000. Mr Woodgate’s second report was dated 23 February 2005 and was addressed to the Tribunal. He explained the basis of the instructions he had received from the acquiring authority in 2003, he attached a copy of his first report and he reiterated the view that the value of the subject property at the valuation date was £185,000. He explained that this valuation had been arrived at by the residual method, although he did not produce his calculations or any comparable transactions. 5[14]Mr Woodgate’s third written report was dated 21 June 2005 and was also prepared for the purposes of this reference. On this occasion he referred to a number of sales of houses in the area. He concluded that the market value of the subject property, when refurbished and excluding the rear garden area, would have been £385,000. From this figure he deducted £175,000 for building costs, fees and profit and thus arrived at a revised market value of £210,000. He explained that he had increased his valuation from £185,000 because he had concluded that his original estimate of its refurbished value was too low; his estimate of building costs, fees and profit remained unchanged.[15]As I have said, Mr Walker arrived at his final valuation of £270,000 by making adjustments to the total price which was achieved for the subject property several months after the valuation date. He prepared a residual valuation as a check, but he did not increase his primary valuation above £270,000, even though the residual calculation produced a figure approximately ten per cent higher.[16]Mr Woodgate agreed that valuation by reference to comparable sales was more reliable than valuation by the residual method. He also agreed that it was acceptable valuation practice to use post valuation date evidence. Mr Woodgate’s firm was instructed to dispose of the subject property shortly after the valuation date and it negotiated the sale of the leasehold interest which was eventually completed in July 2004. It is therefore rather surprising that he did not refer to that sale in his initial report to the Tribunal and that, as he confirmed in answer to a question from me at the end of his oral evidence, he took no account of the actual sale proceeds when arriving at his valuation figure.[17]The marketing history is as follows. Mr Woodgate’s firm was instructed on 3 November[2003]They prepared illustrated sales particulars (excluding the garden behind Nos. 16 and 18) and circulated them to applicants on their register, to those parties who had previously registered their interest with the acquiring authority and to those responding to advertising. The property was advertised in the Herts Advertiser and the St Albans Review on 3 and 4 December 2003, 10 December 2003, 18 December 2003 and 7 January 2004. Offers in the region of £200,000 subject to contract were invited by 12 January 2004. 28 offers, ranging from £101,000 to £235,000, were received and a sale was agreed at the latter figure subject to contract. Subsequently, the person whose offer had been accepted indicated that he wanted the new lease to be granted to another person, for whom he suggested he had been acting as agent. This proposal was not acceptable to the acquiring authority. The original purchaser was not prepared to take the lease in his own name and withdrew from the transaction on 26 April[18]In order to avoid further abortive negotiations the property was advertised again on 26 May 2004 and prospective purchasers were invited to submit sealed bids in excess of £220,000 by 1 June 2004. Nine offers were received on that date although only two parties submitted formal tenders. All nine were then invited to sign the agreement for lease and submit a deposit cheque, as a result of which five firm tenders were received and the lease was completed on 7 July 2004 in consideration of a premium of £253,250 plus vendor’s costs.[19]Mr Woodgate disagreed with Mr Walker’s method of indexing that figure back to the valuation date by reference to the Land Registry index. Bearing in mind that a full marketing exercise had produced a maximum offer of £235,000 for the lease in January 2004, he thought 6 Mr Walker’s indexed-back figure of £257,250 including the rear garden area must be too high. He considered that the index, based on a limited number of transactions in a postcode area which comprised a variety of housing types, did not accurately reflect changes in market value.[20]I agree with Mr Woodgate on this point. If Mr Walker’s approach is right, the value of the subject property increased by only 2.34% in the period of approximately 8 months between the valuation date and the date when the successful offer was made for the new lease. That is a very modest rate of increase. In my view it is inconsistent with the marketing history, which suggests that there was a strong demand for the property in the period up to 12 January 2004 and again in May and June 2004 when the property was re-marketed. It is also inconsistent with other Land Registry figures, which show that values of terraced houses in AL13 increased by 5.5% between the third and fourth quarters of 2003. I bear in mind that the latter percentage might itself have overestimated the movement in values in the relevant period. Considering the available evidence overall, however, I find that the value of the subject property rose by 7.5% between the valuation date and June 2004. The total sale proceeds of £263,250 therefore suggest that the value of the subject property at the valuation date was £244,884, say £245,000.[21]This calculation does not reflect the adverse effect on value of the publicity given to the proposed traffic changes which Mr Walker considered, and I accept, depreciated the value at the valuation date by £5,000 compared with the situation in June 2004. I do not obtain any assistance from the respective residual valuations, which tend to be unreliable when prepared for arbitration purposes. I accept Mr Woodgate’s view that there was no hope value attaching to the rear garden and that there was no material difference between the freehold value of the property and its value on the basis of a lease, with the right subsequently to acquire the freehold for £1. I conclude that the value of the subject property in its actual condition at the valuation date was £240,000.[22]I have not lost sight of the fact that this valuation is £5,000 more than the highest offer received some three months after the valuation date. The latter, however, excluded the garden at the rear of Nos.16 and 18. Moreover, it was obtained following a marketing campaign which had sought offers for the proposed lease “in the region of £200,000”. That asking price was no doubt arrived at in the light of Mr Woodgate’s opinion that the market value was £185,000; a figure which, with the benefit of hindsight, both experts now accept was too low. I think Mr Walker was right to suggest that the conservative quoting price might have had a depressing effect on the level of offers obtained. In that connection it is noteworthy that, when remarketing, Mr Woodgate’s firm decided to seek offers “in excess of” instead of “in the region of” £220,000. Claim for additional value[23]The claimant contends that the subject property should be valued, not in its actual dilapidated condition, but on the assumption that by the valuation date it had been put in good order with the benefit of a grant from the acquiring authority. She therefore seeks additional compensation, equal to the difference in value between the property in repair and in disrepair. Alternatively she claims the “lost” renovation grant of £50,000, plus architect’s fees incurred in connection with the grant application. 7[24]In support of her claim for additional value, the claimant gave factual evidence regarding the history of the subject property from 1981, when she purchased the freehold interest, until the property was eventually compulsorily acquired in 2003. This evidence included numerous references to a large bundle of correspondence which had been used in previous proceedings relating to the CPO. Its principal purpose was to demonstrate that, in dealing with matters arising from the deteriorating condition of the property over the years, officers of the acquiring authority had acted in contravention of their statutory duties.[25]The claimant raised the same criticisms at the CPO inquiry. In paragraph 190 of his report dated 18 May 2001 to the Secretary of State, the Inspector said, under the heading “Conclusions”:
“All in all I am satisfied that during the long and complicated history of events relating to this property Council officers failed on occasions to act in accordance with statutory duties, Government guidance and Council policy. For example they did not issue a revised schedule of work in 1991 or take proper action on the s.80 and s.189 notices and subsequent enforcement. They sometimes acted inconsistently; gave inaccurate information and some letters could have been more clearly worded. In some instances their actions may have been coloured by their view that it was Ms Joyce’s choice to live in an unfit house and that she was unwilling to do work to it of her own accord.”
[26]Mr Williams did not call any evidence to contradict that conclusion and I accept it. The Inspector then continued: “191. On the other hand some of Ms Joyce’s actions have hampered efforts to improve the property. In particular she did not pursue the opportunity given by the availability of a 100 per cent grant in 1989 when costs were relatively low, and she agreed to a court order, which she believed was incorrect. It seems to me that her concern to ensure that every detail of every matter was handled correctly hindered progress particularly as the situation became more complex. She put forward inconsistent or contradictory arguments at times, for example as to whether she had sufficient financial resources or whether the work was a single interrelated package or could be divided into self-contained elements such as the roof.[192]On reflection perhaps both sides could have handled many matters better and it seems to me that the present state of the order property is due to the cumulative effect of various actions or failures to take action by both Ms Joyce and the Council in the past. However, there are many unknowns and imponderables to be taken into account when assessing what might have happened if situations had been dealt with differently at various times in the past. I am not convinced from the evidence before me that the outcome would have necessarily been significantly different in terms of the condition of the property.”[27]For a long time the claimant has been of very limited means. She lost her job very shortly after purchasing the subject property and she has been unemployed ever since, living at first on supplementary benefit and then income support. Because of her lack of funds she was never in a position to carry out the major works which were necessary unless the acquiring authority could be persuaded to meet the full cost, or at any rate the vast majority of the cost, 8 by way of grant. As the Inspector found, the acquiring authority’s actions in relation to the requested grant are open to criticism. Nevertheless, it seems to me that, on occasions, the claimant failed to respond positively to approaches from the acquiring authority and, as a result, eventually fostered the impression that the property would never be put into repair unless it was compulsorily acquired.[28]An example of what seems to me to be an unhelpful approach by the claimant is provided by discussions shortly before the CPO was made. The possibility that the property might be compulsorily acquired was first raised at a meeting of the acquiring authority’s policy and resources committee on 24 June 1999. The report to that committee concluded as follows:
“8.1 The maximum grant entitlement in respect of Miss Joyce’s application is £50,000. It is considered that since the VAT inclusive cost of total works was £57,000 at the time of approval and the grant aided works were £43,000 even at maximum the costs of the works will be greater than the grant available. Miss Joyce is on income support and has no resources which would fund the shortfall to bring the house back to a reasonable state of repair. 8.2 No repairs have been carried out to the house certainly since 1981 when the first approach for grant assistance was made. The house has deteriorated over the intervening time such that it is now grossly unfit and a public health nuisance. 8.3 Miss Joyce’s neighbours have been suffering from a statutory nuisance related to the condition at 20 Marlborough Road for at least the past six years. The Council is under a mandatory duty to abate the nuisance. 8.4 There seems no realistic prospect that Miss Joyce will ever undertake the works of her own volition. For these reasons the Committee are recommended to commence proceedings towards a compulsory purchase order to enable the house to be brought back to a habitable condition.”
[29]The claimant criticised this report on the grounds that it omitted any reference to the acquiring authority’s own shortcomings in its approach to the condition of the subject property. That criticism is well-founded. Nor did the report refer to the temporary repairs to the roof which had been undertaken by the claimant with the aid of a grant from the Department of Health and Social Security in 1984. Nevertheless, the fundamental problem which the report correctly identified was the fact that the claimant was not in a position to have the subject property repaired so long as there was a substantial shortfall between the builder’s estimate and the amount of grant available. The claimant accepted that that was the case. Nor is there any convincing evidence to suggest that the Inspector was wrong to conclude that the authority’s grant offer in March 1998 of approximately £43,000 was one it could properly have made within the limits of its discretion.[30]Part II of the minutes of the committee meeting on 24 June 1999 referred to the subject property as follows:
“Further to Minute 179 above, the property in question was 20 Marlborough Road, St Albans, which was owned by Miss Mary-Jo Joyce. It was unfit for human habitation 9 by reason of gross disrepair and was causing a statutory nuisance to neighbouring premises by reason of penetrating dampness and a major pigeon infestation. There had been a long history of attempts to make the house fit for habitation and to abate the nuisance going back to 1981, including application by the owner for a renovation grant which was eventually approved. Grant works were required to be completed within 12 months of approval and a formal extension of time was granted which would finish in September 1999. Although on 22 March 1999 the owner had confirmed that works would commence in 4 to 6 weeks time, no works had commenced … There seemed to be no realistic prospect that the owner would undertake works of her own volition and the Committee were recommended to commence proceedings towards a Compulsory Purchase Order to enable the house to be brought back into a habitable condition. Members and Officers acknowledged the difficult situation with regard to this case and the need to handle the negotiations with sensitivity, tact and diplomacy. The point was made that the decision to proceed with a Compulsory Purchase Order was in principle only and, once Miss Joyce had been notified of the Council’s intended actions, it was possible that a compromise could be reached.”
[31]Both the report to the committee and Part II of the minutes were confidential and were not shown to the claimant at the time. Nevertheless, in a letter to the claimant dated 5 July 1999 Mr Ridley, the acquiring authority’s director of environmental services, said “I am very concerned at the considerable time that it is taking to repair your property. The grant was approved on 18 March 1998 with a condition that the work should be completed within 12 months. I must advise you that the Council have considered this matter further and resolved it may be necessary to compulsorily purchase the property. I would like to invite you to this office to discuss this matter.”[32]At a meeting with officers of the acquiring authority on 20 July 1999, the claimant was told that the CPO was being “retained as a motivating factor” to encourage her to complete the grant works. Following that meeting, on 2 August 1999, Mr Ridley wrote to the claimant again. He indicated that he had spoken to the claimant’s contractor, Mr King “and reassured him about his concerns regarding stage payments whilst works are carried out to your house. I have also received his assurance that his company are still interested in carrying out the works.”[33]Mr Ridley added that Mr Hide, the authority’s principal environmental health officer “has prepared a revised draft specification based on achieving the fitness standard but not exceeding the grant limit. I enclose a copy for your consideration.”[34]The enclosure listed thirteen 10 “items that could possibly be removed from the works schedule to reduce the cost of work.” Mr Hide added “I have not checked out how much difference the above would make to reducing the grant costs. Most of the costs, however, are fairly minor except the basement tanking, front basement window and central heating. Unless Miss Joyce is prepared to accept that work will not be carried out to the basement rooms I cannot see how the costs can be reduced to anywhere near the £50,000.”[35]The claimant told me that she had insisted that the basement had to be included because the entire structural fabric needed to be put in repair. Given that the subject property had been in an unfit state and causing nuisance to neighbouring properties for many years; that the claimant was reliant upon the acquiring authority for most if not all of the cost of the necessary repairs and that there was an imminent threat of compulsory acquisition, I do not consider that her refusal to compromise on the basement was reasonable.[36]The future of the proposed grant was discussed at a further meeting on 8 September 1999 between the claimant, a local councillor and Messrs Ridley and Hide and, in a letter dated 10 September, Mr Hide advised the claimant that the grant approval had been further extended until 14 October 1999. On that date the policy and resources committee decided that the request for a further extension of time be rejected . The claimant was informed of this on 20 October 1999, at which time the grant lapsed. The decision to make the CPO was made by the full council on 10 November 1999.[37]In this reference, the onus is on the claimant to prove her loss. Having seen and heard her giving evidence, and having studied the correspondence to which I was referred, I have not been persuaded that her case – that the subject property would have been in good condition at the valuation date if the acquiring authority had complied with its obligations – has been substantiated.[38]The claimant puts her claim primarily on the basis of s.9 of the 1961 Act, which provides that:
“No account shall be taken of any depreciation of the value of the relevant interest which is attributable to the fact that (whether by way of designation, allocation or other particulars contained in the current development plan, or by any other means) an indication has been given that the relevant land is, or is likely to be acquired by an authority possessing compulsory purchase powers.”
[39]She submits that, but for the contraventions of their statutory duties by officers of the acquiring authority, and/or but for the indication of the forthcoming CPO contained in letters written to her in July 1999, the grant would have been obtained and employed to full effect and the subject property would have been in good condition at the valuation date. I have found that the claimant has failed to establish that the actual condition of the property was due to the actions of the acquiring authority. Nor do I accept that s.9 applies to the circumstances of this case. Firstly, the subject property had the same value, that is its open market value in disrepair, both before and after the CPO was announced and at the valuation date. It was not in a 11 condition to realise a sale price of the amount claimed at any relevant time. The offer of a grant which had been made prior to the date of the indication was personal to the claimant and did not attach to the property. Secondly, there is no evidence that the property was allowed to deteriorate contrary to a planned series of works because of the indication that the CPO was likely. The indication was only that, if the necessary works were not done and the grant process failed to revert the property into a fit condition, compulsory purchase might be required. At all times between the announcement of the CPO and the valuation date, the subject property remained in the same condition, and its value was unaffected by the announcement that the CPO might be required if the grant process failed.[40]If no indication of the CPO had been given in July 1999, the gap between the cost of work required and the maximum available grant would have continued to increase. Even assuming that the acquiring authority would have been prepared to extend further the period within which the works must be completed in order to qualify for the grant, the claimant would not have been able to bridge the gap and the property would have remained in disrepair.[41]The claimant’s alternative contention is that she is entitled to the £50,000 grant sum plus the (unquantified) architects’ fees she expended in applying for the grant. This claim is expressed to be made under rule 6. It is necessarily based on the assumption that, in the absence of the compulsory acquisition, she would have received a grant sooner or later. There is, in my judgment, no evidence to support such a claim. The CPO was made because the claimant was unable to make up the shortfall between the maximum available grant and the cost of the necessary works. Furthermore, the grant offer was subject to a condition that the works must be completed by October 1999, when the offer lapsed. Assuming again that, in the absence of the CPO, this dead-line would have been further extended, the shortfall is likely to have continued to increase, as the condition of the building deteriorated further and the cost of the necessary works rose, while the grant maximum remained unchanged. The claim under rule 6 therefore fails. Home loss payment[42]The claimant seeks a home loss payment under s 30 of the Land Compensation Act 1973. Subsection 30(1) provides that, in the case of a person who at the date of displacement is occupying the dwelling by virtue of an interest in it including a freehold, the amount of the home loss payment shall be ten per cent of the market value of his interest in the dwelling. This compensation is subject to maximum and minimum figures which, at the valuation date, were £31,000 and £3,100 respectively.[43]Subsection 29(2), as amended, provides as follows:
“A person shall not be entitled to a home loss payment unless the following conditions have been satisfied throughout the period of one year ending with the date of displacement – (a) he has been in occupation of the dwelling, or a substantial part of it, as his only or main residence; and (b) he has been in occupation as aforesaid by virtue of an interest or right to which this section applies 12 but, if those conditions are satisfied on the date of displacement… a ‘discretionary payment’) may be made to him of an amount not exceeding the amount to which he would have been entitled if he had satisfied those conditions throughout that period.”
[44]The acquiring authority took possession of the subject property on 13 October 2003, two days after ownership vested in them on the valuation date. During the year prior to the valuation date the claimant was living in Bootle. On 4 March 2002 she moved from St Albans to Merseyside to assume responsibility as the main carer for her mother, who was in her nineties and in very poor health and she stayed at her mother’s home. In the period of over nineteen months between then and the valuation date the claimant returned to the subject property on three occasions. The first was for 10 days in the summer of 2002, when her mother was taken back to her birthplace in Ireland. The other two visits coincided with the hearings in the Administrative Court and the Court of Appeal and each lasted for about a week. Many of the claimant’s belongings remained at the subject property after she moved to Bootle. Those which were not fouled by pigeon excrement or damaged by water were removed by the acquiring authority after they took possession and have been stored by them ever since. Throughout the relevant period of 12 months there was no electricity supply to the subject property and water was only available from a single tap from the main, located in the kitchen. On the three occasions when she did visit the property after March 2002, the claimant never spent the night there, but always stayed with friends.[45]Whether or not the conditions of subsection 29(2) are satisfied is a matter of fact. I am in no doubt that, during the period of one year ending with the valuation date, the claimant was not in occupation of any part of the subject property as her only or main residence. The claimant was living in Bootle. She hoped eventually to be able to return to live in the subject property, but such hope is insufficient to bring her circumstances within the scope of subsection 29(2). There is therefore no entitlement to a home loss payment. Although reference was made to certain other disturbance losses, no evidence was put forward to support them.[46]Accordingly, I determine that the compensation payable by the acquiring authority to the claimant is £240,000. In addition the acquiring authority will pay a surveyor’s fee of £1,250 plus VAT. The parties are now invited to make representations as to costs. A letter relating to that accompanies this decision, which will take effect when but not until the question of costs has been determined. Dated: 1 September 2005 N J Rose FRICS Addendum on costs 13[47]I have received written submissions on costs from the acquiring authority. None have been received from the claimant, despite the fact that the dead-line within which they were to be filed was extended at her request until 19 September 2005.[48]The acquiring authority accept that generally the costs of a reference to determine compulsory purchase compensation fall on the acquiring authority. They say, however, that on 19 July 2005 they made an unconditional offer under s.4 of the Land Compensation Act 1961. The amount offered was £241,250 plus statutory interest since the valuation date. The letter made it clear that the offer related to compensation for the freehold interest in the reference land including the garden land, and that no compensation was offered for a home loss payment or for the section 9 claim. Mr Walker, the claimant’s expert, acknowledged the offer on the same day. He said that the claimant was not prepared to accept any element of the offer. The acquiring authority also confirmed at the hearing that they would pay Mr Walker’s costs of preparing the claim up to £1,250 plus VAT. At no time had the offer or any part of it been accepted, either before the hearing or during the five days on which the Tribunal sat.[49]The acquiring authority submit that the sealed offer exceeded the compensation awarded, the amount to be paid in surveyor’s fees relating to the preparation of the claim of compensation, and in any event was the same amount as the award. Alternatively, the freehold value determined by the Tribunal was lower than the amount of the offer which was expressed as specifically relating to the valuation of the freehold land and the garden land. Further, the offer made it clear that no compensation would be offered in relation to section 9 or home loss payments. It followed that the offer should have been accepted and the hearing of evidence on these issues was unnecessary. Accordingly, the acquiring authority seek an order that they pay the claimant’s costs of the reference incurred before 19 July 2005 on the standard basis and that the claimant pay the acquiring authority’s costs on the standard basis from that date. Alternatively, the claimant should pay the costs of the acquiring authority incurred in relation to the freehold valuation of the land, the section 9 claim (also framed in the alternative as a rule 6 claim for disturbance) and the home loss payment since 19 July 2005. Alternatively, the claimant should pay the costs of the acquiring authority in relation to the hearing of the valuation evidence since 19 July 2005.[50]The total compensation awarded to the claimant was £241,468.75 including surveyor’s fees. This is marginally more than the acquiring authority’s unconditional offer. Before that offer was made, the authority had received Mr Walker’s expert report dated 1 April 2005, which included reference to his fees for preparing the claim. The quantum of those fees had been the subject of previous correspondence between the parties and they should have been included in the amount offered by the acquiring authority. Where, as in this case, the acquiring authority have made an unconditional offer which is exceeded by the award, and the claimant has made a claim but no offer, the claimant will normally be awarded costs unless there is a special reason not to do so (see Colneway Limited v Environment Agency [2004] RVR 37).[51]In my judgment, there are special reasons why this general rule should not be followed in the present case. Firstly, counsel for the acquiring authority stated at the commencement of the second day’s hearing that his clients were prepared to pay surveyor’s fees equal to the amount eventually awarded. At that time the claimant could have sought to accept the unconditional offer, made only six days earlier, provided the agreed surveyor’s fees were paid in addition and 14 the matter is likely to have been settled on that basis. She did not do so, and as a result the hearing continued for a further three and a half days without benefit to the claimant. Secondly, the claimant unnecessarily prolonged and complicated the proceedings, leading to an unnecessary escalation of costs. She arrived late on the first two days, and gave no explanation or apology. When I pointed out that the costs were mounting and asked how much longer she would require to present her case, the claimant replied by asking the length of a piece of string. No criticism can be made of the claimant in respect of that part of the proceedings which related to the valuation of the freehold interest in the subject property in its existing condition, in respect of which Mr Walker presented the claimant’s case. The claimant presented the remaining aspects of the claim in person. As a result of the wholly inadequate nature of the written material which she had prepared in relation to those matters, it was necessary for her to spend six hours giving evidence in chief. This compares with less than five hours which were required for Mr Walker and Mr Woodgate both to complete their evidence, including cross- examination, on the freehold value. Finally, the acquiring authority’s unconditional offer failed to beat the award by a tiny margin.[52]With these considerations in mind, I order that the acquiring authority shall bear the claimant’s costs up to and including 19 July 2005, that there be no order as to costs from 20 July up to and including the second day of the hearing and that thereafter the claimant shall bear the acquiring authority’s costs. All such costs are to be agreed or, in default of agreement, assessed on the standard basis by the Registrar of the Lands Tribunal. 28 September 2005 N J Rose FRICS 15