Decision Nº ACQ 81 2000. Upper Tribunal (Lands Chamber), 03-08-2000
| Jurisdiction | UK Non-devolved |
| Judge | George Bartlett QC President |
| Date | 03 August 2000 |
| Court | Upper Tribunal (Lands Chamber) |
| Judgement Number | ACQ 81 2000 |
ACQ/81/2000
COMPENSATION - notice of reference - preliminary issues - whether compensation already subject of binding contract - Limitation Act 1980, s 9 - whether claim-statute barred - whether acquiring authority estopped from relying on limitation - held binding contract - no estoppel - claim dismissed
IN THE MATTER of a NOTICE OF REFERENCE
BETWEEN LLANELEC PRECISION ENGINEERING CO LTD Claimant
and
NEATH PORT TALBOT Acquiring
COUNTY BOROUGH COUNCIL Authority
Re: Land at Cadoxton Road, Neath
Before: The President
Sitting at 48/49 Chancery Lane, London WC2A 1JR
on 12, 13 and 17 July 2000
The following cases are referred to in this decision:
Hillingdon London Borough Council v ARC Ltd [1999] Ch 139
Munton v GLC [1976] 1 WLR 649
Mercer v Liverpool, St Helen’s and South Lancashire Railway [1903] 1 KB 652, [1904] AC 461
Harding v Metropolitan Railway Co (1872) 7 Ch App 154
London Borough of Hillingdon v ARC Ltd (No.2) (16 June 2000, unreported)
Co-operative Wholesale Society v Chester-le-Street District Council [1996] 46 EGLR 158, [1998] 38 EGLR 153
Lillis v North West Water Ltd [1999] RVR 12.
Kammins Ballroom Co Ltd v Zenith Investments (Torquay) Ltd [1971] AC 850
Williams v Blaenau Gwent County Borough Council (No.2) [1999] 2 EGLR 195
Appearances: Nicholas Nardecchia, instructed by Messrs Morgan Cole, Solicitors of Cardiff for the Claimant
Milwyn Jarman, instructed by Carole Anne John, Head of Legal Services, Neath Port Talbot County Borough Council for the Acquiring Authority
DECISION ON PRELIMINARY ISSUES
Introduction
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This is a decision on two preliminary issues that arise on a claim for compensation for the compulsory acquisition of land at Cadoxton Road, Neath. The reference was stated to relate to 1.2 acres of land, but it is now accepted on behalf of the claimant that it should relate to 0.4661 acre of land and an easement for the construction and maintenance of a viaduct on 0.3326 acre, which were acquired, along with other parcels of land, by the acquiring authority’s predecessor, West Glamorgan County Council, under the County of West Glamorgan (Neath Inner Urban Bypass) Compulsory Purchase Order 1986. The claimant is the successor in title to Mecalec Engineering Co Ltd, who were served with notice to treat on 22 January 1987 and later went into receivership. The acquiring authority subsequently accepted Llanelec as claimant. Neath Port Talbot County Borough Council succeeded to the County Council’s functions on 1 April 1996.
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West Glamorgan County Council served notice of entry on Mecalec and entered on the land on 25 February 1987. They constructed a viaduct from a new roundabout on Cadoxton Road southwards over the A465 and the river Neath to an area called Fair Field, which was thereby opened up for development. The works were completed in 1989.
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There were negotiations on compensation during the period 1988 to 1990, but these appear to have come to nothing, principally because the County Council did not accept that Llanelec were entitled to any compensation for disturbance. Negotiations resumed in 1992, and they reached a point at which the County Council’s officers were offering to recommend £28,000 including £5,000 for disturbance, and Llanelec’s surveyor Mr Ieuan Jones asking for £40,000 including the £5,000 for disturbance. In May 1993, Mr W J John, a director of Llanelec instructed Mr Jones to accept the £28,000 and on 24 May 1993 he accordingly wrote to the County Council to that effect. The County Council approved the terms, and from August 1993 to 1 March 1995 the County Council’s solicitor and Llanelec’s solicitors, Morgan Bruce, were in correspondence about the grant of easements across the land in respect of certain existing pipes belonging to British Gas and the Welsh Water Authority. The first of the two principal matters in dispute is whether the agreement on the £28,000 compensation resulted in an enforceable contract.
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The second principal matter arises if there was no contract. In Hillingdon London Borough Council v ARC Ltd [1999] Ch 139 the Court of Appeal held that section 9 of the Limitation Act 1980 applied to references to the Lands Tribunal under the Land Compensation Act 1961. The limitation period expired in the present case on 23 February 1993, 6 years after entry. The reference to this Tribunal was not made by the claimant until 13 January 2000, nearly 13 years after the date on which, in terms of section 9, the cause of action accrued, and nearly 7 years after the expiry of the limitation period.
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The acquiring authority have taken the limitation point. The claimant, however, says that the authority is estopped from relying on limitation. Mr Nicholas Nardecchia, for the claimant, submitted that an estoppel by convention arose from a shared assumption that the 6 year period of limitation did not apply and negotiations between the parties on the basis of this assumption, and that it would be unjust and unconscionable to allow the authority to go back on this shared assumption. He also put the case on the basis of promissory estoppel or waiver. Whether the claim is statute-barred is the second preliminary issue that now arises for decision.
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Evidence on the factual issues was called on both sides. Mr Nardecchia called three witnesses, Courtney John, managing director of the claimant company, Ieuan Jones FRICS, the chartered surveyor who acted for the claimant up to July 1993, and Brian Williams, a tax consultant employed by Morgan Cole, who, previously under the name Morgan Bruce, have acted throughout as the claimant’s solicitors. For the acquiring authority Mr Milwyn Jarman called Lucia Thomas, Senior Legal Officer with West Glamorgan County Council up to 31 March 1996; Ian Ritchie, Senior Valuer with the County Council up to 31 March 1996; Katrin Roberts, solicitor with Neath Port Talbot County Borough Council; Iorwerth Harding Griffiths BSc(Est Man), FRICS, Property Manager for the Borough Council; Gareth John Nutt, Head of Estate and Architectural Services for the Borough Council; and David Arthur Phillips Rees, Senior Development Solicitor to the Borough Council.
Whether there is an enforceable agreement
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On the first issue, Mr Nardecchia advanced three arguments. The first was that, contrary to the assertion of the acquiring authority, there was no concluded agreement. This requires a consideration of the correspondence passing between the claimant’s agents and the County Council. Secondly he said that, if there was an agreement, it was subject to contract and accordingly not binding. On this he relied on a letter said to have been sent to the County Council on 16 June 1992 by Mr Ieuan Jones, the surveyor acting for the claimant at that time. Mr Nardecchia’s third argument was that, if there was an agreement, it was not enforceable because there was no document sufficient to satisfy the terms of section 2 of the Law of Property (Miscellaneous Provisions) Act 1989.
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Leaving aside for the moment the disputed letter of 16 June 1992, the correspondence starts with a letter of 18 June 1992 from Mr Jones to the Legal Department of West Glamorgan County Council. The letter said -
“I have been advised by my client’s solicitors Messrs Morgan Bruce, Swansea to recontact you in relation to submitting a claim for compensation for the above site.”
Mr Jones enclosed a claim, which was expressed to be for -
“...firstly the total amount of land blighted by acquisition or easements such as under the bridge, secondly for severance and injurious affection and thirdly disturbance ....”
The total claim was £78,000.
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Three months later, on 16 September 1992, the council not having replied to the letter, Mr Jones had a meeting with Mr Ian Ritchie, a valuer with the County Council, but they failed to make any progress towards an agreement. Mr Jones followed this up with a letter dated 24 September 1992, which addressed the question of disturbance, on which Mr Ritchie had said that he required to be satisfied. On 14 October 1992 Mr Ritchie replied. He referred to the question of disturbance saying that he would recommend, on a without prejudice basis, a payment for disturbance of £5,000; and then he said:
“To summarise, I am prepared to recommend my Council to acquire the Interests previously under discussion, as detailed below for the sum of £28,000.00 in full and final settlement of all Heads of Claim.
(a) Acquisition of Freehold Interest with Vacant Possession in 0.4661 acres or thereabouts of land.
(b) Easement in Fee Simple over 0.3326 acres of thereabouts for the construction and future maintenance of the viaduct together with access over the re-aligned access track.”
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Mr Jones replied on 20 October 1992 saying that he and his clients were grateful for the disturbance offer, but he asked that settlement should be agreed at £40,000 “on an under all heads of claim basis, together with my clients properly incurred legal costs, my fee under the 1991 Ryde’s Scale and interest.” In response to this letter Mr Ritchie wrote on 28 October 1992, saying that he was not persuaded to reconsider his offer, which he considered to be very fair and reasonable. He said that the offer should be regarded as a package which was...
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