Hillingdon London Borough Council v ARC Ltd
| Jurisdiction | England & Wales |
| Judge | LORD JUSTICE POTTER,LORD JUSTICE MUMMERY,LORD JUSTICE NOURSE |
| Judgment Date | 07 April 1998 |
| Judgment citation (vLex) | [1998] EWCA Civ J0407-16 |
| Court | Court of Appeal (Civil Division) |
| Date | 07 April 1998 |
| Docket Number | CHANI 97/0974 CMS3 |
[1998] EWCA Civ J0407-16
IN THE SUPREME COURT OF JUDICATURE
COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE HIGH COURT OF JUSTICE
CHANCERY DIVISION
(Mr Stanley Burnton QC)
Royal Courts of Justice
Strand, London WC2
Lord Justice Nourse
Lord Justice Potter and
Lord Justice Mummery
CHANI 97/0974 CMS3
MR N KING (MR R WARREN 7.4.98) (instructed by Messrs Lawrence Tucketts, Bristol) appeared on behalf of the Appellant Defendant.
MR J HARPER QC (instructed by the Environmental Law Practice, London Borough of Hillingdon) appeared on behalf of the Respondent Plaintiff.
Tuesday, 7th April 1998
INTRODUCTION
1. The question which arises upon this appeal is whether a claim for compensation for compulsory purchase resulting from entry by an acquiring authority onto land pursuant to Section 11 of the Compulsory Purchase Act 1965 ("the 1965 Act") is subject to the limitation period laid down in Section 9 of the Limitation Act 1980 ("the 1980 Act") notwithstanding that the amount of compensation payable has not been agreed or determined by the Lands Tribunal.
THE FACTS
2. There are agreed facts in this case which can be shortly summarised in this way. In 1972 the defendants/appellants became the lessees of land bordering the Grand Union Canal on which they operated their minerals, processing and distribution depot, known as the West Drayton Aggregates Depot. The lease was for a period of thirty-five years from 24th December 1970. In 1980 the plaintiff/respondents, the London Borough of Hillingdo ("the Authority") made the London Borough of Hillingdon Yiewsley By-pass (Cherry Lane Roundabout to High Street Yiewsley) Compulsory Purchase Order (No.1) 1980. ("The CPO"). It authorised compulsory purchase of land for the Yiewsley by-pass including parts of the appellants' Depot which were required for the construction of a single carriageway flyover. In December 1981, the Secretary of State confirmed the CPO without amendment. On 22nd March 1982, the Authority served a Notice to Treat in respect of the appellants' land, followed, on 7th April 1982, by a Notice of Intention to Enter. On 19th April 1982 the appellants served a Claimant's Claim in Answer to the Notice to Treat. The sum stated to be claimed by way of compensation was £400,000 plus costs.
3. On 26th April 1982, the Authority entered to construct what were known as the Phase 1 works which were completed by April 1984. The carriageway was officially opened on 11th May 1984. However, for reasons which need not be elaborated, no detailed claim was put forward by way of follow-up to the appellants' original Claim in Answer to the Notice to Treat, until 2nd January 1992 when the Authority received the appellants' claim in respect of both the Phase 1 works and certain further Phase 2 works carried out in the interim. That claim, and a subsequent claim under Section 52 of the Land Compensation Act 1973, were both rejected by the Authority for failing to provide sufficient proof to justify the appellants' claims. A subsequent claim was made in respect of the Phase 1 and Phase 2 works which was also rejected on 9th November 1993.
4. By Notice dated 6th September 1995, the appellants made a reference to the Lands Tribunal under Section 1 of the Land Compensation Act 1961 in respect of both the Phase 1 and Phase 2 works. It was the Authority's case that the claim in respect of Phase 1 was so stale that it was not capable of precise investigation so long after events to which it referred. On 29th November 1995, the Authority made an interlocutory application to the Lands Tribunal pursuant to Rule 49 of the Lands Tribunal Rules 1975 for a preliminary hearing on a Point of Law.
5. By Order dated 12th December 1995, the Lands Tribunal identified one of the points of law in issue as:
(1) Whether any claim for compensation by ARC Ltd arising from the exercise by the … [Authority] … of its powers under the.. [CPO}.. is now barred as a result of the provisions of S.9 of the Limitation Act 1980.
By a further Order made on 21st May 1996 the Lands Tribunal declined jurisdiction to decide that Issue.
6. By Originating Summons dated 9th July 1996, the Authority sought the determination of the High Court, Chancery Division, upon the Issue, claiming a declaration that the claim of the appellants for compensation was time-barred under S.9 of the 1980 Act.
THE JUDGE'S DECISION
7. On 12th June 1997 Stanley Burnton QC sitting as a Deputy Judge of the High Court determined that the appellants' claim for compensation was indeed time-barred under that Section. His decision is reported at [1998] 1 WLR 174.
8. Observing that it had been widely assumed, on the basis of the decision of the Divisional Court in Turner -v- Midland Railway Company [1911] KB 832, that no limitation period is applicable until the amount of the compensation has been agreed or determined, the judge held that such assumption was incorrect. He found that the appellants' cause of action arose when the authority entered upon and took possession of the land in accordance with the procedure laid down in Section 11 of the 1965 Act, that being the day when the defendant first had a right to compensation and to interest upon the amount of such compensation. He held that the compensation to which the appellants were entitled was "a sum recoverable by virtue of any enactment" within the meaning of Section 9 of the 1980 Act, irrespective of whether the compensation had yet been quantified by agreement or by the Lands Tribunal and that, upon that basis, the applicable, 6-year limitation period expired in 1988. While it was not essential to his decision, he went on to hold that a reference to the Lands Tribunal is "an action to recover" compensation for the purposes of Section 9(1) of the 1980 Act.
THE RELEVANT STATUTORY PROVISIONS
9. The appellants' right to compensation in respect of the Phase 1 works arose under Section 1 the 1965 Act, which provides:
This Act shall apply in relation to any compulsory purchase to which Part II of the Acquisition of Land Act 1981 or Schedule 1 to that Act applies …
Section 11 of the 1965 Act, so far as material, provides:
(1) If the acquiring authority have served Notice to Treat in respect of any of the land and have served on the owner, lessee and occupier of the land not less than fourteen days' notice, the acquiring authority may enter on and take possession of the land or of such part as is specified in the Notice; and then any compensation agreed or awarded for the land of which possession is taken shall carry interest.. from the time of entry until the time the compensation is paid or it is paid into court in accordance with this Act …
(2) The acquiring authority may also enter on and take possession of any of the land by following the procedure in Schedule 3 to this Act.
(3)..
(4) Except as provided by the foregoing provisions …, the acquiring authority shall not, except with the consent of the owners and occupiers, enter on any of the land subject to compulsory purchase until the compensation payable for the respective interests in that land has been agreed or awarded, and has been paid..
Section 6 of the 1965 Act provides:
If a person served with a Notice to Treat does not within 21 days from the service of the notice state the particulars of his claim or treat with the acquiring authority in respect of his claim, or if he and the acquiring authority do not agree as to the amount of compensation to be paid by the acquiring authority for the interest belonging to him or which he has the power to sell, or for any damage which may be sustained by him by reason of the execution of the works, the question of disputed compensation shall be referred to the Lands Tribunal.
Section 7 of the 1965 Act provides:
In assessing the compensation to be paid by the acquiring authority under this Act, regard shall be had not only to the value of the lands to be purchased by the acquiring authority, but also to the damage, if any, to be sustained by the owner of the land by reason of the severing of the land purchased from the other land of the owner, or otherwise injuriously affecting that other land by the exercise of the powers conferred by this or the special Act.
The provision in Section 6 for the reference of the question of disputed compensation to the Lands Tribunal is consistent with Section 1 of the Land Compensation Act 1961 which provides:
Where by or under any statute.. Land is authorised to be acquired compulsorily, any question of disputed compensation.. shall be referred to the Lands Tribunal and shall be determined by the Tribunal in accordance with the following provisions of this Act.
It is not in dispute between the parties that the provision of the Limitation Act 1980 applicable in this case is Section 9(1) which provides:
"An action to recover any sum recoverable by virtue of any enactment shall not be brought after the expiration of six years from the date on which the cause of action accrued."
[It is to be noted that the predecessor of this provision, S.2(1)(d) of the Limitation Act 1939, was to similar effect, although it contained an exception in respect of "a penalty or forfeiture or sum by way of penalty or forfeiture"].
By Section 38 of the 1980 Act (Interpretation), previously S.31(1) of the 1939 Act:
"'action' includes any proceeding in a court of law, including an ecclesiastical court"
10. The 1965 Act does not contain any provision concerned expressly with limitation of actions. However it is of interest that ...
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