J S Bloor (wilmslow) Ltd v Homes and Communities Agency
| Jurisdiction | England & Wales |
| Judge | Lord Justice Patten,Lord Justice Sales,Lord Justice Jackson,and |
| Judgment Date | 22 May 2015 |
| Neutral Citation | [2015] EWCA Civ 540 |
| Docket Number | Case No: C3/2013/2698 |
| Court | Court of Appeal (Civil Division) |
| Date | 22 May 2015 |
[2015] EWCA Civ 540
IN THE COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE UPPER TRIBUNAL (LANDS CHAMBER)
His Honour Judge Mole QC and P R Francis FRICS
[2013] UKUT 0231 (LC)
Royal Courts of Justice
Strand, London, WC2A 2LL
Lord Justice Jackson
Lord Justice Patten
and
Lord Justice Sales
Case No: C3/2013/2698
Michael Humphries QC and Alexander Booth (instructed by Eversheds LLP) for the Appellant
Martin Kingston QC and Richard Kimblin (instructed by DWF LLP) for the Respondent
Hearing date : 30 April and 1 May 2015
Introduction
The Appellant, the Homes and Communities Agency ("HCA"), is the acquiring authority under the North West Development Agency (Kingsway Business Park, Rochdale) Compulsory Purchase Order 2002 ("the CPO"). It took over the property rights and liabilities of the North West Development Agency ("NWDA") under a Transfer Scheme on 19 September 2011 and is therefore now responsible for the payment of the compensation due to the Respondent, J S Bloor (Wilmslow) Limited ("the Claimant"), in respect of the compulsory acquisition of two plots of land comprised within the CPO. These are Plot 13 (9.71 acres) and Plot 14 (17.14 acres) which were acquired by the Claimant in May 2003 for a total cost of £1.3m. The sale price included a further area of some 0.4 acres adjoining Plot 14 (referred to as the Nib) which is land that divides Plot 13 and Plot 14 from a public highway called Buckley Hill Lane, which could be used to provide a means of access from those plots to the highway.
These parcels of land were until May 2003 in the ownership of various members of the Nall family who had submitted a planning application for residential development on the site with highway access via the Nib but had been refused planning permission on 18 January 2002. After its purchase, the Claimant took over the objections to the CPO in respect of Plots 13 and 14 ("the reference land") and appeared at the 2003 public inquiry in order to seek the removal from the CPO of the part of the reference land that fell within the area of the order land designated for residential development as part of the Kingsway Business Park ("KBP"). On 5 October 2004 the Secretary of State confirmed the CPO subject to various immaterial modifications and a general vesting declaration was made in respect of the reference land on 4 January 2006. This is the valuation date for the purpose of determining the compensation payable to the Claimant. I should emphasise at this point that the reference land does not include the Nib which has always remained outside the boundaries of the order land and therefore remains in the Claimant's ownership.
In 2010, the Claimant made an application to Rochdale Metropolitan Borough Council, the local planning authority, under s. 17 of the Land Compensation Act 1961 ("the 1961 Act") for a certificate of appropriate alternative development in relation to the reference land ("the s.17 application"). By this application the Claimant sought a certificate of the opinion of the Council under s. 17(4) that planning permission might have been expected to be granted for, amongst other things, residential development if the land had not been made subject to compulsory purchase. In December 2010 the application was withdrawn after the Council's planning officer had drafted a report recommending refusal because the proposed alternative development did not comply with relevant planning policies in relation to the area designated for development of the KBP and with national and regional planning policies. The report observed that the reference land was a greenfield site and that, outside the context of development of the KBP, residential development there would be contrary to the sequential approach to housing development as set out in Planning Policy Guidance 3 ("PPG3"), which gives priority to such development on brownfield sites.
The reference land is poor quality grazing land with an existing use value which the HCA estimated to be about £2,000 per acre. But the Claimant sought compensation in the sum of £2,593,000 on the basis that the reference land had significant hope value based on the prospect of planning permission for a residential development on part of the reference land with highway access via the Nib.
The determination of the amount of compensation was referred to the Upper Tribunal (Lands Chamber) ("UT") (HH Judge Mole QC and Mr P R Francis FRICS) which, in a decision dated 28 May 2013, awarded compensation in the sum of £746,000. This was based on there being a 50% chance of planning permission being granted for a 74 unit development on 4.88 acres of the reference land (with access via the Nib) subject to a deferred period of 5 years. HCA challenges this valuation but not in terms of its methodology nor in respect of the values placed upon the reference land given the relevant valuation assumptions which the calculation of compensation adopts. These are largely matters of planning and valuation evidence and expertise which the UT, as a specialist tribunal, is almost uniquely qualified to determine.
The principal ground of appeal is that, in assessing the prospect of planning permission being granted for a residential development on the reference land in accordance with s.14(3) of the 1961 Act, the UT misapplied the statutory disregards contained in s.6 and Schedule 1 to the Act. In particular, it was wrong to treat the planning policies applicable to the reference land and the planning history based upon them as being in any way modified by the notional cancellation of the CPO in respect of the reference land which forms the first part of the valuation construct under s.16(7) of the 1961 Act or by the statutory disregards under s.6. What it is said that the UT has done wrong is to have based the calculation of compensation upon an assumption that the KBP scheme has been cancelled in its entirety so that, at the date of valuation, the requirement in the development plan that there should be a comprehensive and unified development of the order land was required to be treated as more likely to be relaxed in favour of an independent development on the reference land than it would have been while the KBP scheme was in contemplation. For the same reason, it was wrong, they say, for the UT in that hypothetical situation to have attached less weight than would otherwise be the case to the earlier refusal of planning permission for a housing development on the reference land.
If these criticisms are well-founded then the Appellant's case is that the valuation exercise proceeded upon a misdirection as to the relevant statutory test to be applied which vitiates the decision on compensation. They therefore seek an order setting aside the decision and remitting the reference back to the UT to be re-considered upon a correct application.
Planning history
In order to understand the issues raised by this appeal I must begin by outlining the planning background and, in particular, the development policies relevant to the KBP. These are based on the agreed statement of facts produced by the parties for the UT.
The CPO was made by NWDA on 10 May 2002 for the purpose of assembling some 420 acres of land at Milnrow, Rochdale as the site of the KBP. The order lands are located about 1 mile east of Rochdale and to the north-west of junction 21 on the M62 motorway. Prior to their inclusion in the KBP scheme, the order lands consisted, for the most part, of low-grade equestrian and grazing land with a number of isolated buildings and farmsteads. The site is traversed by Stanney Brook, a site of biological importance and a nature conservation area.
The possibility of developing land in this area as an industrial estate has been mooted since the 1960's but was not the subject of a feasibility study until 1979. In 1980 the Kingsway Industrial Park Feasibility Study Interim Report was published with a final report in November 1983 which identified the site as suitable for major commercial development. In August 1998 planning permission was granted for the proposed business park but this was subsequently overturned as a result of an application for judicial review.
In November 1999 the developers published the KBP Development Framework ("the Framework") to support a revised planning application. The Framework stated:
"The Kingsway Business Park, although primarily a focus for business and employment uses, will be a high quality mixed use development, for business, light industry and distribution complemented by hotel and leisure facilities with small scale retailing, local services and residential areas.
andResidential facilities are proposed in their limited form compatible with the requirement of criterion (p) of the [1999] UDP Policy EC/6, located on a site to the north of Buckley Hill, and within the integrated canalside development on Plot S".
The framework also included a Master Plan layout for the KBP and provided for its phased development. Parts of Plots 13 and 14 were included in what is described as Plot X in the Master Plan. This is an area designated for residential development. The remainder of the reference land is located within Plots P, Q and R, all of which are designed for B1 Office and Floor space.
Planning consent for the KBP based on the Framework and the Master Plan was granted on 19 December 1999. As at the valuation date there were planning consents, still extant, for the KBP (over the whole of the reference land);...
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