GARROD WEST v TORFAEN COUNTY BOROUGH COUNCIL LCA/63/2004

UPPER TRIBUNAL
LANDS CHAMBER
LCA/63/2004Case No LCA/63/2004
Between
GARROD WESTApplicantTORFAEN COUNTY BOROUGH COUNCILRespondent
Before
The PresidentMair Coombes Davies (instructed by Granville-West, solicitors of Pontypool) for ClaimantTimothy Jones (instructed by the County Borough Council solicitor, Torfaen County Borough Council) for Compensating AuthorityVenue Cardiff County Court, 2 Park Street, Cardiff CF1 1ETHearing 6 April 2005Property: Ty Gwyn,, Penygraig Terrace,, Pontymoile,, Pontypool NP4 5JSCatchwords: COMPENSATION – compulsory purchase – preliminary issue – limitation – estoppel – held claim statute-barred
[1]The claimant in this case gave notice of reference dated 9 September 2004 in respect of compensation claimed by him under section 44 and section 1 of the Land Compensation Act 1973. The amount of the claim was stated to be £300,000. On 19 January 2005, on the application of Torfaen County Borough Council (who are referred to as the compensating authority, despite the fact, as I shall say, that part of the claim is against that authority as successor to an authority exercising compulsory powers of acquisition) I ordered that the question of whether the claim is statute-barred should be determined as a preliminary issue.[2]The claim relates to the claimant’s property, Ty Gwyn, Penygraig Terrace, Pontypool, which consists of a dwellinghouse and a building plot next to it. Under the County Council of Gwent (Pontymoile Improvement, Pontypool, Route A472 Classified Road) Compulsory Purchase Order 1994, the former Gwent County Council were authorised to acquire easements over parts of Ty Gwyn. The compensating authority is the successor to Gwent County Council. The first of the easements related to a plot, 7A as shown on the CPO plan, 21sq m of the garden of the property, and consisted of the right to construct and maintain footings and to construct and maintain a retaining wall. The second related to plot 7B, 23 sq m of the garden, and it consisted of a right to construct and maintain ground anchors. On 4 January 1996 notice to treat and notice of entry were served and on 17 January 1996 a claim in answer to notice to treat was sent by the claimant’s valuers to Gwent County Council. The amount claim was £2,500 plus £50,000 for injurious affection plus £5,000 for disturbance. Entry was taken on 21 May 1996.[3]On 21 April 1998 the claimant’s valuer wrote to the council asking for an advance payment of compensation in respect of the compulsory acquisition. The question of value was referred to the District Valuer, and his estimate for the compensation payable was £7,500. On 15 July 1998 the council paid the claimant 90% of this plus interest. Negotiations between the DV and the claimant’s agents resumed in January 2002 but on 22 October 2002 the DV reported to the council that he had been unable to agree compensation and he provided the council with his revised assessment of compensation, a figure of £10,750. On 24 January 2003 a further 90% advance payment was made to the claimant together with interest. On 20 June 2003 the compensating authority paid the claimant the final instalment of compensation as assessed by the DV together with interest on it.[4]It appears that before the date of possession the claimant had been seeking to get Gwent County Council to buy the totality of his interest, and subsequent efforts on his part to do so and negotiations between him and the DV continued in a desultory fashion for a number of years after possession was taken. Before possession was taken the claimant had asked the council to buy the whole of his property, but they had refused. However, on 5 March 1996 they wrote to him to say that they would buy the whole of his property and they put the matter of valuation in the hands of the District Valuer. The claimant did not find the value that the DV put on the property to be acceptable and in 1997 he asked the council to purchase Ty Gwyn minus the building plot, for which he had obtained planning permission. The DV was instructed again but he was unable to agree the amount of compensation with the claimant. 3[5]In January 2000 the council again instructed the DV to negotiate with the claimant for the purchase of Ty Gwyn minus the building plot. The DV reported in April 2000 that his opinion of value was £86,500 excluding the building plot and that he had reached agreement with Mr West. However, delays in formalising the agreement occurred, and in due course the claimant asked for a revaluation of the property. On 3 October 2001 the council wrote to the claimant’s solicitors to say that the offer of discretionary acquisition at £86,500 excluding the building plot would remain open for a further 28 days. On 4 December 2001 the council wrote to the claimant’s solicitors informing them that, as the time limit given in that earlier letter had expired, the council revoked all offers made to the claimant in respect of the discretionary acquisition of Ty Gwyn.[6]The claimant’s claim is put, as I have said, on the basis of section 44 of the Land Compensation Act 1973 and section 1 of that Act. Section 1 gives a right to compensation where the value of an interest in land is depreciated by physical factors by the use of public works. However section 8(2) provides that, where a person is entitled to compensation in respect of the acquisition of an interest in land by an authority possessing compulsory purchase powers, then, whether or not any sum is paid or payable in respect of injurious affection of the land retained, compensation is not payable under Part 1 of the 1973 Act on any claim in relation to those works made after the date of notice to treat. Mr Timothy Jones for the compensating authority said that that provision effectively excluded any entitlement that the claimant might assert under section 1, although that was not a matter that arose under the terms of the preliminary issue.[7]Section 44 does not itself confer a right to compensation. It provides:
“(1) Where land is acquired or taken from any person for the purpose of works which are to be situated partly on that land and partly elsewhere, compensation for injurious affection of land retained by that person shall be assessed by reference to the whole of the works and not only the part situated on the land acquired or taken from him.”
Under subsection (2) compensation for injurious affection includes compensation for injurious affection under section 7 of the Compulsory Purchase Act 1965. It is under section 7 that the claimant’s entitlement to compensation for injurious affection arose, and the effect of section 44 is simply to establish the basis of assessment. Under section 7, in assessing compensation to be paid by the acquiring authority under the Act, regard must be had not only to the value of the land purchased by the acquiring authority but also to any diminution in the value of land retained by the claimant by the exercise of the compulsory powers. The claimant’s entitled to compensation for injurious affection is thus part of his entitlement to compensation for the acquisition of his land.[8]Under section 9(1) of the Limitation Act 1980 an action to recover any sum recoverable by virtue of any enactment cannot be brought after the expiration of six years from the date on which the cause of action accrued. In Hillingdon London Borough Council v ARC Limited [1999] Ch 147 the Court of Appeal held that this provision applied to references to the Lands Tribunal under the Land Compensation Act 1961 and that for the purposes of the provision the cause of action accrued on the day that possession of the land acquired was taken. The council say that possession here was taken on 21 May 1996 and, although the claimant does not admit that, I am satisfied that that was indeed the date when possession was taken. A letter dated 4 20 June 1996 from Gwent Consultancy, the acquiring authority’s agent, to the District Valuer said this:
“I am also advised by the Resident Engineer that the date of entry to all plots at the north side of Penygraig Terrace was 21 May 1996. These plots are Nos. 7A, 7B ….”
There is no evidence to support any other date and no reason is advanced to suggest that that might not be the correct date. Accordingly the limitation period expired on 21 May at 2002. Reference to this Tribunal was made on 9 September 2004 and the claim is therefore statute- barred unless the claimant is able to show that the council is estopped from relying on limitation or has otherwise waived the provisions of the Limitation Act.[9]For the claimant Mrs Mair Coombes Davies submits that there has been estoppel by convention. She says that after the expiry of the limitation period both parties continued to negotiate on the basis that either of them might refer the claim for compensation to the Lands Tribunal. There was a convention between them to this effect just like the one that this Tribunal (Judge Marder QC) found to exist in Co-operative Wholesale Society v Chester le Street District Council (1996) 73 P & CR 111 at 123:
“In my judgment the evidence establishes that both parties in this transaction proceeded on the basis of a common assumption that they were negotiating settlement of a valid claim for compensation without regard to the statutory limitation period and on the basis that if agreement could not be achieved the matter would in the last resort be referred to the Tribunal for determination.”
[10]The evidence relied on by Mrs Coombes Davies to establish this convention consists of two letters and on evidence given by the council’s witness, David Price, in cross-examination. The first letter was dated 24 January 2003 and was from Mr Price to the claimant. It enclosed the further advance payment in respect of the land acquired. It noted that the claimant had rejected the DV’s valuation of £10,750. It went on:
“I am writing to you also to formally request that you reconsider your decision and inform me whether you are now prepared to proceed with this matter on the District Valuer’s valuation. If not, I will have no alternative than to inform my instructing department for their approval to place this matter before the Lands Tribunal.”
[11]The second letter was dated 10 July 2003 and was from the acting chief executive of Torfaen County Borough Council to a National Assembly member, Mr M German. It was evidently written in response to a letter from Mr German enquiring about the state of negotiations between the claimant and the council. It referred to the compulsory purchase order, to the request of the claimant for a discretionary acquisition of his property and to the abortive negotiations about such acquisition. It recorded the council’s withdrawal of the offer of discretionary acquisition. It then went on:
“The District Valuer was then instructed to negotiate with Mr West’s agents in respect of the acquisition of the easements required under the compulsory purchase order but again compensation could not be agreed. The District Valuer therefore reported to the 5 Council that agreement could not be reached but provided an assessment of the compensation payable. This compensation has been paid to Mr West who has accepted the same on the basis that he still does not agree the amount of compensation as assessed. It is only the dispute as to assessed compensation in respect of the easements to be acquired by the Council that can be referred to the Lands Tribunal. The Council wrote to Mr West on 24 January 2003 formally requesting that he reconsider his decision and inform the Council whether he would be prepared to proceed with the matter at the District Valuer’s valuation. If he was not prepared to proceed then he was informed that consideration would be given to a reference to the Lands Tribunal.”
[12]The council’s witness, David Price, said that he was employed by the authority as a legal officer and that he had worked for them and their predecessor, the Torfaen Borough Council, since September 1974. In his witness statements he set out the history of the acquisition and the claims for compensation by reference to documents which he produced as exhibits. Cross- examined by Mrs Coombes Davies Mr Price said that he did not draw to the DV’s attention the fact that the limitation period was coming to an end when he was re-instructed in January 2002. He said that they instructed the DV to carry on as normal. He was to pick up the threads from the previous instructions. Mr Price accepted that from then on things were proceeding as normal, but he rejected the suggestion that if there had been no agreement there would have been a reference to the Lands Tribunal. He said that the council would have dealt with the matter as it thought appropriate when it knew what the position was. Mr Price was asked, with reference to his letter of 24 January 2003, whether he had spoken to the claimant after the DV’s revised valuation had been received. He replied that he could not say but that Mr West called into the office on numerous occasions. He said that he could not recall any discussion concerning the Lands Tribunal. The reference in the letter to placing the matter before the Lands Tribunal was made in an attempt to bring Mr West back in order to agree compensation. It did not say that it was definite or implicit that the authority would go to the Lands Tribunal. It was simply a possibility. In a further letter of 20 June 2003 from Mr Price to Mr West there was a reference to a recent meeting between them at Mr Price’s office. He said that he did not recall the Lands Tribunal being mentioned at all. It was possible, he said, that Mr West might have said that he would take the council to the Lands Tribunal but he could not confirm or deny that.[13]The claimant was not present to give evidence. There was a signed witness statement from him containing a declaration of truth. It recounted the history of the compulsory acquisition of the easements and the works carried out by the council on his land, which, he said, went further than the permitted scheme. He said that he had requested the council many times to erect fencing along the north and south boundaries of his property, but they did not do so. The noise level from the new road was so high as to make normal activity in the garden impossible, and the failure to fence the land meant that it became the subject of vandalism. The noise, insecurity and vandalism increased to such an extent that Ty Gwyn became uninhabitable, and he ceased to occupy it in about June 2000. He said that his belief was that he could not make a claim against the council until 12 months had elapsed from the opening of 6 the highway to public traffic. That had been on 24 September 1998, so that the limitation period did not expire until 24 September 2005 and the reference was accordingly in time.[14]The claimant said nothing in his evidence to suggest that there was a convention between him and the council that his claim for compensation for the compulsory purchase of the interests in his land could be referred to the Lands Tribunal outside the limitation period. His only reference to limitation was made in the context of a possible claim under Part I of the 1973 Act. This, in my judgment, is fatal to Mrs Coombes Davies’s contention that there was a common assumption between the parties that there could be a reference to the Tribunal outside the limitation period. There is no evidence at all that the claimant relied on such a convention. Mr Price did not accept that there was such a convention, and the two letters that Mrs Coombes Davies relied on fall short of establishing that there was. Mr Price said that they referred to the possibility of a reference to the Lands Tribunal being made by the council in an attempt to induce Mr West to continue negotiations. I accept that it was indeed in the nature of a threat rather than an indication of the common assumption for which Mrs Coombes Davies contends. The council are not, in my judgment, estopped from relying on limitation.[15]I should add that in the claimants' reply to the council’s statement of case it was pleaded that to deny the claimant the compensation sought in this case would be to breach his human rights, in particular his rights to property and his home. Mrs Coombes Davies did not develop this point, and in my judgment there is nothing in it. Both Article 1 of the First Protocol, in respect of property, and Article 8, in respect of a person’s home, confer rights that are subject to the power of the state to interfere with them in the public interest. The imposition of a limitation period on the exercise of statutory rights to compensation for compulsory acquisition of land is potentially within the exception of each of these articles, and I can see nothing to suggest that the 6-year period or its application in this case would be disproportionate.[16]The result is that the claim for compensation is statute-barred to the extent that it is based on the Land Compensation Act 1961 and section 7 of the Compulsory Purchase Act 1965, and is expressed to be based on section 44 of the Land Compensation Act 1973. The preliminary issue is thus decided in the compensating authority’s favour. Counsel accepted that the costs of the preliminary issue should follow the event, and I therefore determine that the claimant must pay the compensating authority’s costs of the preliminary issue, such costs if not agreed to be the subject of detailed assessment by the Registrar on the standard basis. 13 April 2005 George Bartlett QC, President 7