Decision Nº ACQ 83 2011. Upper Tribunal (Lands Chamber), 28-05-2013
| Jurisdiction | UK Non-devolved |
| Judge | George Bartlett QC President Sir Keith Lindblom, President |
| Date | 28 May 2013 |
| Court | Upper Tribunal (Lands Chamber) |
| Judgement Number | ACQ 83 2011 |
|
UPPER TRIBUNAL (LANDS CHAMBER) |
|
|
UT Neutral citation number: [2012] UKUT 417 (LC)
UTLC Case Number: ACQ/83/2011
TRIBUNALS, COURTS AND ENFORCEMENT ACT 2007
COMPENSATION – compulsory purchase – preliminary issue – freehold and long leasehold interests subject to occupational leases – whether value of interests to be assessed on assumption that terms of leases were as they would have been if no proposal to acquire – held they should not – Land Compensation Act 1961 ss 5 & 9
IN THE MATTER OF NOTICES OF REFERENCE
BETWEEN (1) GPE (HANOVER SQUARE) LIMITED Claimants (2) 18/19 HANOVER SQUARE (NO.1) LIMITED(3) 18/19 HANOVER SQUARE (NO.2) LIMITED
and
TRANSPORT FOR LONDON Acquiring
Authority
Re: 18-19 Hanover Square
and 1A Tenterden Street
London W1
Before: The President
Sitting at 43-45 Bedford Square, London WC1B 3AS
on 19 and 20 June 2012
Neil King QC and Simon Pickles instructed by Berwin Leighton Paisner LLP for the claimants
Michael Barnes QC and Eian Caws instructed by Ashurst LLP for the acquiring authority
© CROWN COPYRIGHT 2012
The following cases are referred to in this decision:
Pointe Gourde Quarrying & Transport Co Ltd v Sub-Intendant of Crown Lands [1947] AC 565
South Eastern Railway Co v London County Council [1915] 2 Ch 252
Fraser v City of Fraserville [1917] AC 187
Rugby Joint Water Board v Shaw-Fox [1973] AC 202
Minister of Transport v Pettitt (1968) 20 P & CR 344
Transport for London v Spirerose Ltd [2009] 1 WLR 1797
Persimmon Homes v Secretary of State for Transport [2009] UKUT (LC) 126
Jelson Ltd v Blaby District Council [1977] 1 WLR 1020
Melwood Units Pty Ltd v Commissioner of Main Roads [1979] AC 426
Bradford Property Trust Ltd v Hertfordshire County Council (1974) 27 P & CR 228
Lewars v Greater London Council (1982) 43 P & CR 129
Thornton v Wakefield MDC (1991) 62 P & CR 441
Fletcher Estates (Harlescott) Ltd v Secretary of State for the Environment [2000] 2 AC 307
Urban Edge Group Ltd v London Underground Ltd [2009] UKUT (LC) 103
Myers v Milton Keynes Development Corporation [1974] 1 WLR 696
Waters v Welsh Development Agency [2004] 1 WLR 1304
Porter v Secretary of State for Transport [1996] 3 All ER 693
London Borough of Hackney v MacFarlane (1970) 21 P & CR 342
Trocette Property Co Ltd v Greater London Council (1974) 28 P & CR 408
The following further cases were referred to in argument
Allied Maples Group Ltd v Simmons & Simmons [1995] 1 WLR 1602
Attorney General of New Zealand v Ortiz [1982] QC 349
Blue Circle Industry Plc v Ministry of Defence [1999] Ch 289
Cornwall Coast Country Club v Cardgrange Ltd [1987] 1 EGLR 146
Director of Buildings & Lands v Shun Fung Ironworks Ltd [1995] 2 AC 111
English Property Corporation v Royal Borough of Kingston upon Thames (1999) 77 P & CR 1
Jones v Wrotham Park Settled Estates [1980] AC 74
-
The claimants in this reference are the freeholders and long leaseholders of property at 18 and 19 Hanover Square and 1A Tenterden Street, London WC1. Their interests in the subject property were acquired compulsorily by the compensating authority under powers contained in the Crossrail Act 2008. Those interests were subject to three occupational leases. The claim for compensation that is the subject of this reference is advanced on the basis that, had it not been for the Crossrail proposal, occupational leases would have been entered into with other tenants and on terms more favourable to the landlords; and that the freehold and long leasehold interests should be valued on this basis. The contention is founded both on section 9 and rule (6) of section 5 of the Land Compensation Act 1961. With the agreement of the parties I ordered that two issues, expressed in the following terms, should be determined as preliminary issues:
“(a) Whether, in assessing the value of the interests of the Claimant in the property acquired at the valuation date of 2 December 2009 under rule (2) of section 5 of the 1961 Act, the effect of section 9 of the 1961 Act is to require or to permit the value of those interests to be assessed on the basis that the parties to and certain terms of certain leases of parts of the property* had not been as they actually were but instead as they would have been likely to have been if no indication had been given that the property was, or was likely, to be acquired by the Acquiring Authority.
*The property was subject to 3 occupational leases: at 18 Hanover Square (which includes 1A Tenterden Street) a retail and an office lease, and at 19 Hanover Square an office lease only. As to the parties and terms, the Claimant contends that the occupational leases would have been let to equivalent or superior tenants, that the rents achievable for all the occupational leases would have been greater, and that the provisions relating to terms certain and break clauses would have been different. These contentions as to differences in the tenants and terms of the leases are not agreed by the AA.
(b) On the assumption (made for the purposes of this preliminary issue only) that the rents receivable from the tenancies of the property in the period 1 December 2005 to 1 December 2009 were less than they would have been had it not been anticipated that the property would be acquired compulsorily and had there been no threat of such acquisition, whether the resulting shortfall in rent in respect of that period can be recovered as compensation under rule (6) of section 5 of the 1961 Act.”
-
After a somewhat long drawn out correspondence between the parties following the hearing I decided that the second issue was not suitable for determination as a preliminary issue because it was or might be dependent on evidence that would need to be called; and that the issue should be postponed for determination at the principal hearing. This decision is therefore concerned with the first issue only.
Facts
-
The parties had agreed a statement of facts. They include the following, which I adopt as the factual basis for this decision.
The Claimants
-
The claimants are wholly-owned subsidiaries of Great Portland Estates plc, 33 Cavendish Square, London W1G OPW. As at 2 December 2009 (the valuation date for the purpose of the reference), the claimants held the freehold title absolute in the properties at 18 and 19 Hanover Square and 1A Tenterden Street (titles no. NGL883856, NGL226684 and NGL901470 respectively). 1A Tenterden Street forms the rear of and was held with 18 Hanover Square and is, unless otherwise indicated, included within any reference in this decision to 18 Hanover Square.
-
Numbers 18 and 19 Hanover Square are situated on the west side of Hanover Square, to the south of Oxford Street and west of Regent Street. At the valuation date they formed part of a larger portfolio of property owned by GPE known as the Hanover Estate.
18 Hanover Square
-
At the valuation date 18 Hanover Square comprised accommodation arranged on lower ground, ground and six upper floors. It was constructed in 1965; and it was refurbished in 2004. The accommodation comprised an office and showroom property of approximately 3,546.68 sq m (38,173 sq ft). It provided office accommodation on the first to sixth floors with a self-contained showroom unit and offices on ground floor level with access to Hanover Square via the main reception area, and basement car parking. Office floor plates were regular with a single line of columns, allowing sub-division or open space planning for occupiers. The average floor size was approximately 511 sq m (5,500 sq ft). The sixth floor, which is smaller, had roof terrace areas on two elevations, but no lift between the 5th and 6th floors.
-
There was parking for 22 cars in the basement car park accessed from Tenterden Street, along with a secondary entrance to the property. A loading bay area for the showroom unit was accessed from Tenterden Street. The Hanover Square frontage provided the main point of access to the office floors via an entrance hall served by two 8-person passenger lifts. The lifts did not serve the sixth floor. There were two additional lifts at the rear of the ground floor area accessed from the secondary entrance from Tenterden Street (albeit these were taken out of service at the time of the refurbishment in 2004).
-
The remainder of the...
To continue reading
Request your trial