ETON PARK CONSULTING LIMITED v GREATER MANCHESTER PASSENGER TRANSPORT EXECUTIVE ACQ/438/2007

UPPER TRIBUNAL

LANDS CHAMBER

ACQ/438/2007

Case No ACQ/438/2007

Between

ETON PARK CONSULTING LIMITEDApplicant

GREATER MANCHESTER PASSENGER TRANSPORT EXECUTIVERespondent

Before

A J Trott FRICS

Date 13 October 2009

Property: Land at the rear of Albany House, Albany Road, Chorlton, Manchester, M21 0AN

[1]This is a reference made on 2 July 2007 by the acquiring authority, the Greater Manchester Passenger Transport Executive (GMPTE), to determine the amount of compensation payable in respect of the compulsory acquisition of 51 sqm of land forming part of the embankment between a disused railway line and the building known as Albany House, Albany Road, Chorlton, Manchester M21 0AN.

[2]GMPTE compulsorily purchased the subject land under the Greater Manchester (Light Rapid Transit System) (Airport Extension) Order 1997. Notice to treat was served on 10 May 2002 and notice of entry was served on 21 January 2005. The date of entry, and hence the valuation date, is said by GMPTE to be 20 May 2005. There is no record of a claim having been made prior to the reference.

[3]The claimant, Eton Park Consulting Limited, was originally represented by Shammah Nicholls LLP, solicitors of Manchester. That firm sent an email to the Tribunal on 31 October 2007 saying that they did not believe there was an issue for the Tribunal to consider. The Registrar therefore arranged for a pre-trial review to be held on 4 December 2007. The claimant failed to attend or to be represented. The Registrar issued directions for the future conduct of the reference on 12 December 2007, the first of which was a direction that the claimant should file and serve a statement of case by 18 December 2007.

[4]Upon receipt of the Registrar’s order Ms Hunwick of Shammah Nicholls sent an email to the Tribunal on 13 December 2007 stating:

“... I confess to being utterly baffled by this whole situation ... I do not believe that there is an issue for the Tribunal to consider between my client and GMPTE and cannot quite understand how the Tribunal came to order my client to serve a Statement of Case when there is no case. I am going to attempt to resolve this directly with GMPTE who seem to have decided that it is more expeditious to litigate this matter than enter into ordinary correspondence. For the avoidance of doubt Eton Park will not be serving a Statement of Case because they do not have a case.”

[5]In view of this statement the acquiring authority were asked to file and serve its valuer’s expert report. This was filed on 1 May 2008. Both parties then confirmed that the reference should be determined without a hearing. On 1 July 2008 the Tribunal received a letter from Shammah Nicholls saying that they had received a TPl (Transfer of part of registered title) form from GMPTE and had asked their client to sign it. No details were given of the price although it seems likely that it was in the sum of £500, the amount contained in GMPTE’s 4 notice of reference. Shammah Nicholls said that once the signed form had been forwarded to GMPTE “...at that stage there is no further necessity for [the] involvement of yourselves.”

[6]In the event the transfer did not proceed. On 11 August 2008 Shammah Nicholls sent an email to GMPTE saying that the claimant had spoken to “other land owners in Chorlton who have sold to GMPTE and has decided that his piece of land is much larger than theirs and needs therefore, on a pro rata basis, to be paid £1,000”.

[7]On the 20 August 2008 the acquiring authority increased its offer to £750, subject to a time limit for acceptance of 29 August 2008. The offer was not accepted and on 7 October 2008 Shammah Nicholls informed the Tribunal that they were no longer instructed by the claimant and that Mr Anderson of Eton Park Consulting Limited would be acting on its behalf. Mr Anderson failed to respond to three subsequent letters from the Tribunal and has not made any written representations. GMPTE were asked to submit any further representations they wished to make in the light of the claimant’s request for compensation of £1,000. No such further representations have been received. Evidence

[8]The only representations before the Tribunal are submitted by GMPTE and are contained in the expert report of Mr James Ogborn BA (Hons) DipLE MRICS, a Director of Lambert Smith Hampton and Head of Land Assembly in the Manchester office of that firm. In his report Mr Ogborn says that the claimant’s agent is GVA Grimley and that they were appointed on 1 July 2005 but there is no other record or document before this Tribunal of that practice having been so instructed.

[9]The reference land is a narrow strip of disused and unbounded land (approximately 2.5 x 20 m) adjoining Albany House, Albany Road in Chorlton Cum Hardy, some two miles south west of Manchester City Centre. It lies in an area of mixed residential and commercial property.

[10]Mr Ogborn relies upon three comparable transactions in the nearby area, each of which comprised forecourt land and was acquired under the scheme for £500.(i) 40 sqm of land at 649 Mauldeth Road West,

(ii) 21 sqm of land at 294 Barlow Moor Road,

(iii) 18 sqm of land at 292 Barlow Moor Road, In the light of this evidence Mr Ogborn values the freehold interest in the reference land in the sum of £500. 5 Conclusion

[11]I am satisfied, in the absence of any further evidence, that the comparables support a figure of £500 for the value of the freehold interest in the reference land. In reaching this decision I am mindful of two things; firstly that the comparables are all settlements under the scheme and are not open market transactions and, secondly, that they differ considerably in size. On the first point there is unlikely to be any evidence of open market transactions for small land parcels such as these and no evidence (of any sort) has been produced by the claimant to rebut the valuation of the acquiring authority. On the second point I do not think it appropriate to analyse these comparables and the reference land on a per square metre basis. I accept Mr Ogborn’s approach that they are all likely to attract a “one-off payment” rather than a price based upon a unit of area comparison. Nor is there any suggestion that the reference land has development value.

[12]The open offer of £750 made by GMPTE on 20 August 2008 was time limited and apparently made in an attempt to compromise the dispute. It was not accepted by the claimant and, in my opinion, does not justify a higher award on the evidence before me.

[13]I therefore determine the compensation in the sum of £500. A letter on costs accompanies this decision which will take effect when, but not until, the question of costs is decided. Dated 8 June 2009 A J Trott FRICS 6 ADDENDUM ON COSTS

[14]I have now received submissions on costs from the acquiring authority. It argues that the claimant persistently failed to engage in negotiations following the acquiring authority’s original offer in February 2005 and that it did not respond to a compromise offer that the acquiring authority made on 20 August 2008. The claimant also failed to submit a statement of case or expert witness report and was not represented at the pre-trial review held on 12 December 2007. The acquiring authority applies for all its costs to be met by the claimant, such costs to be deductible from the compensation.

[15]The claimant has made no submissions on costs. On 30 June 2009 the Tribunal received a copy of a letter to the acquiring authority from Mr Anderson of the claimant company dated 29 June 2009 enclosing a letter to the Tribunal dated 2 May 2008. The May letter gave brief details of the claimant’s purchase of the property in 2004 and stated that, on a pro rata basis, the land acquired could not possibly be worth as little as £500. The letter referred to the acquiring authority’s expert report.

[16]The letter received from the claimant cannot have been dated correctly 2 May 2008 because it is addressed to the Tribunal at Bedford Square, an address that it did not occupy until April 2009. No such letter, whether dated 2008 or 2009, was received by the Tribunal before 30 June 2009. In any event even if it was sent on 2 May 2009 rather than 2008 that was over five months after the Tribunal sent a letter to Mr Anderson giving him 21 days to submit representations before the Tribunal proceeded to determine the reference.

[17]My decision does not become final until the question of costs has been determined and I therefore have discretion to consider the claimant’s correspondence. I decline to do so for two reasons. Firstly, the claimant must show that the evidence that it wishes to rely upon could not have been obtained with reasonable diligence for use in written representations according to the Tribunal’s timetable (see Denning LJ in Ladd v Marshall

[1954] 1 WLR 1489

at 1491). It is clear that the claimant had received a copy of the acquiring authority’s expert report (it recently sent a copy to the Tribunal) and that it could have made the arguments it now seeks to make at the time the Tribunal ordered for submitting written representations. Secondly, that expert report was available to, and considered by, me in reaching my decision.

[18]At all material times the acquiring authority’s expert report was available to the claimant for comment and I do not think that it would serve the course of justice to allow the claimant to make representation about it at this late stage. There is a strong presumption against letting the claimant have a second chance where it has had ample opportunity to collect its evidence and marshall its arguments and where it has seen from my judgment why it has lost.

[19]The award of costs in this reference is governed by the provisions of section 4 of the Land Compensation Act 1961 and the general principles established by authority. That section states: 7 “4(1) Where either –(a) the acquiring authority have made an unconditional offer in writing of any sum as compensation to any claimant and the sum awarded by the Lands Tribunal to that claimant does not exceed the sum offered; or

(b) the Lands Tribunal is satisfied that a claimant has failed to deliver to the acquiring authority, in time to enable them to make a proper offer, a notice in writing of the amount claimed by him, containing the particulars mentioned in subsection (2) of this section; the Lands Tribunal shall, unless for special reasons it thinks it proper not to do so, order the claimant to bear his own costs and to pay the costs of the acquiring authority so far as they were incurred after the offer was made, or as the case may be, after the time when in the opinion of the Lands Tribunal the notice should have been delivered. (2) The notice mentioned in subsection (1) of this section must state the exact nature of the interest in respect of which compensation is claimed, and give details of the compensation claimed, distinguishing the amounts under separate heads and showing how the amount claimed under each head is calculated. …”

[20]On 7 February 2005 the acquiring authority wrote to the claimant’s solicitors offering to purchase the reference land for £500 plus reasonable legal costs. The letter was marked “without prejudice and subject to contract.” The revised offer made by the acquiring authority on 20 August 2008 was time limited. Neither offer was unconditional for the purposes of section 4 and therefore subsection (1) (a) does not apply to either of them.

[21]I have not seen a copy of any claim submitted by the claimant and from the information available to me it appears that the figure of £500 which appears in the notice of reference as the “approximate amount of claim” was an estimate of the acquiring authority. Subsection 1(b) therefore appears to apply. However, in Colneway Limited v Environment Agency [2004] RVR 37 the Tribunal, the President and Mr N J Rose FRICS, said at 47, paragraph 77:

“…there are, we think, undoubtedly circumstances in which an acquiring authority do not need all the details referred to in subs (2) in order to make an offer. If they know the interest in respect of which the claim is made and if they know there is no claim for severance, injurious affection or disturbance, their valuer may well be in as good a position as the claimant’s valuer to value the land and thus enable the authority to make an offer. Failure by the authority in these circumstances to make an offer could, in our view, amount to a special reason to deprive the authority of the costs to which they would otherwise be entitled under s 4(1).”

In this case the acquiring authority made an offer at an early stage (shortly after the service of notice of entry). The fact that this offer was conditional does not, in my opinion, constitute a special reason for depriving the authority of its costs under section 4 (1) (b) in circumstances where the claimant did not make a claim, either quantified or otherwise, at any time before making submissions on costs and where it had indicated that “they do not have a case” (see 8 paragraph 4 above). I consider that the claimant’s behaviour throughout the reference was unreasonable, especially its persistent failure to respond to the Tribunal’s correspondence and directions.

[22]The claimant purchased the reference land in 2004, some time after notice to treat had been served in May 2002. In my opinion the claimant should not be responsible for the costs of the acquiring authority due to the failure of the claimant’s predecessor to submit a timely claim following the service of the notice to treat. However, I think that it was reasonable for a particularised claim to have been submitted by the claimant by 20 August 2005, three months after the date of entry, given that, according to Mr Ogborn, the claimant instructed GVA Grimley to act on its behalf on 1 July 2005.

[23]I determine that the claimant shall meet its own costs and pay the costs of the acquiring authority from the date by which the claimant should have submitted a particularised claim, namely 20 August 2005. The costs, if not agreed between the parties, shall be the subject of detailed assessment by the Registrar on the standard basis. I have no jurisdiction to order that the costs shall be deducted from the compensation awarded. Dated 13 October 2009 A J Trott FRICS