Purfleet Farms Ltd v Secretary of State for Transport, Local Government and the Regions
| Jurisdiction | England & Wales |
| Judge | Lord Justice Potter,Lord Justice Chadwick,Mr Justice Wall |
| Judgment Date | 15 October 2002 |
| Neutral Citation | [2002] EWCA Civ 1430 |
| Docket Number | Case No: C/2001/1636 |
| Court | Court of Appeal (Civil Division) |
| Date | 15 October 2002 |
[2002] EWCA Civ 1430
IN THE SUPREME COURT OF JUDICATURE
COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE LANDS TRIBUNAL
Royal Courts of Justice
Strand,
London, WC2A 2LL
Lord Justice Potter
Lord Justice Chadwick and
Mr Justice Wall
Case No: C/2001/1636
Michael Barnes QC (instructed by Rowe & Maw) for the claimant
Guy Roots QC and Robert Walton (instructed by Ashurst Morris Crisp) for the respondent
INTRODUCTION
This is an appeal on a point of law pursuant to s.3(4) of the Lands Tribunal Act 1949 as amended by the Civil Procedure (Modification of Enactments) Order 2000. It relates to an award of costs dated 3 July 2001 made by the Lands Tribunal (The President and P.H. Clarke FIRCS) by way of an Addendum dated 3 July 2001 ("the Costs Addendum") to the Decision of the Lands Tribunal dated 10 April 2001 ordering the respondent Secretary of State to pay compensation to the claimants in respect of the compulsory purchase of the claimants' land. The appeal concerns the principles underlying the exercise of the discretion of the Land Tribunal in making awards of costs in such cases and, in particular, whether they are or should be the same as those applicable to an award of costs in civil litigation under the Civil Procedure Rules (CPR).
THE BACKGROUND
The reference to the Lands Tribunal (made on 3 February 2000) concerned the compensation payable for an area of open land of 21.6 acres situated between Purfleet and Grays in Essex which had been compulsorily acquired from the claimants by the respondent in connection with the construction of part of the Channel Tunnel Rail Link. The land was vacant and it was agreed between the parties that it was suitable for development for warehouse purposes and enjoyed a deemed planning permission for that use. The compensation for the acquisition under s.5 of the Land Compensation Act 1961 was the open market value of the land, that is the amount which the land if sold in the open market by a willing seller on 30 May 2000 might be expected to realise. It was that sum which the Lands Tribunal had to determine. The claimants sought an award of compensation of £12,260,000. The respondent valued the compensation at £3,750,000. However, on 1 December 2000, the respondent made a sealed unconditional offer in the sum of £5,000,000. After a nine-day hearing, the Lands Tribunal determined the compensation at £6,660,000.
The assessment of the open market value of an area of land on the assumption of a sale for the purpose of development for warehousing purposes involved a series of questions, most of which had to be addressed by expert witnesses. It is not necessary to detail all the issues which underlay the differences between the respective valuations. They were summarised by the Lands Tribunal at paragraph 23 of its decision. Thirteen discrete issues fell for determination. However, there were six main issues involved, upon which the Lands Tribunal found as follows:
(1) As to the basic land value to be derived from the comparables relied upon by the rival experts, the Lands Tribunal found for a figure substantially nearer that of the respondent i.e. £475,000 per acre. The respondent had advanced a figure of £460,000 per acre whereas the figure advanced by the claimants' principal expert was £638,015 per acre.
(2) There was a highway issue which had major implications for the cost of development mainly whether a satisfactory access could be taken from a private road along the western boundary of the land. On this issue the Lands Tribunal found for the claimants.
(3) The respondent sought a reduction of £40,000 per acre (£760,000 overall) from the value on account of the alleged necessity for a planning agreement. The tribunal rejected this contention.
(4) A land drainage question was raised late in the proceedings by the respondent. Eventually there was a large measure of expert agreement on the issue arising.
(5) There was an issue mainly of law, on the exact amount of the net developable area within the total 21.7 acres. The Lands Tribunal found a figure between the contentions of the parties, but substantially closer to that of the respondent.
(6) The respondent contended that the deemed planning permission for warehousing was to be deferred for delay or uncertainty. This issue of law was decided in favour of the claimants.
In its written decision of April 2001, the Lands Tribunal invited written submissions on costs in relation to which the Lands Tribunal Practice Direction, (5 April 2001) had just come into effect. Following receipt of the parties' submissions, by its Costs Addendum, the Lands Tribunal ordered the respondents to pay three-quarters of the costs of the appellant.
THE POWER OF THE LANDS TRIBUNAL TO AWARD COSTS
S.3(5) of the Lands Tribunal Act 1949 provides:
"Subject to the following provisions of this section the Lands Tribunal may order that the costs of any proceedings before it incurred by any party shall be paid by any other party and may tax or settle the amount of any costs to be paid under any such order or direct in what manner they are to be taxed".
S.4(1) of the Land Compensation Act 1961 provides, so far as relevant:
"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 does not exceed the sum offered;
or (b) …;
The Lands Tribunal shall, unless for special reason it thinks it proper not to do so, order the claimant to bear his own costs and to pay the cost of the acquiring authority so far as they were incurred after the offer was made …." (emphasis added)
Rule 52(1) of the Lands Tribunal Rules 1996 S.I. 1996/1022 (as amended) provides:
"Subject to the provisions of Section 4 of the [Land Compensation Act 1961] and of Rule 28(11), the costs of and incidental to any proceedings shall be in the discretion of the Tribunal."
[Rule 28 (11) is not relevant for the purposes of this case]
Paragraph 11 of the Lands Tribunal Practice Direction (5 April 2001) provides:
"1. Introduction
1.1 Procedure in the Lands Tribunal is governed by the Lands Tribunal Rules 1996 (S.I. 1996 No 1022) as amended by the Lands Tribunal Amendment) Rules of 1997 and 1998 ( S.I. 1997 No 1965 and S.I. 1998 No 22). Practice Directions, issued from time to time by the President, contain information on the way in which the procedure contained in the rules is operated. These Practice Directions supersede all those previously issued. They apply to all proceedings, including references by consent.
2. The overriding objective
2.1. The Civil Procedure Rules, which apply to the ordinary civil courts of law (The Court of Appeal, the High Court and the county courts) have no application in the Lands Tribunal. Nevertheless, in following its procedures the Tribunal does so on the basis of the same overriding objective as that in the CPR. The overriding objective is to follow procedures that enable the Tribunal to deal with cases justly. Dealing with a case justly includes, so far as practicable —
(a) ensuring that the parties are on an equal footing;
(b) saving expense;
(c) dealing with the case in ways which are proportionate —
(i) to the amount of money involved;
(ii) the importance of the case;
(iii) to the complexity of the issues;
(iv) to the financial position of each party;
(d) ensuring that it is dealt with expeditiously and fairly; and
(e) allotting to it an appropriate share of the Tribunal's resources while taking into account the need to allot resources to other cases.
2.2. The Tribunal expects parties to assist it to further the overriding objective.
19. Costs
19.1 …..
19.2 Costs are in the discretion of the Tribunal and this discretion will usually be exercised in accordance with the principles applied in the High Court and county courts. Accordingly, the Tribunal will have regard to all the circumstances, including the conduct of the parties; whether a party has succeeded on part of his case, even if he has not been wholly successful; and admissible offers to settle (see paragraphs 19.3 and 19.4 below). The conduct of a party will include conduct during and before the proceedings; whether a party has acted reasonably in pursuing or contesting an issue; the manner in which a party has conducted his case; and whether or not he has exaggerated his claim.
19.3 The general rule is that the successful party ought to receive his costs. On a claim for compensation for compulsory acquisition of land, the Tribunal, applying this general rule, would normally make an order for costs in favour of a claimant who receives an award of compensation. Special rules, however, apply by virtue of Section 4 of the Land Compensation Act 1961. Under this provision, where an acquiring authority has made an unconditional offer in writing of compensation and the sum awarded does not exceed the sum offered, the Tribunal must, in the absence of special reasons, order the claimant to bear his own costs thereafter and to pay the post-offer costs of the acquiring authority. However, a claimant will not be entitled to his costs if he has failed to deliver to the authority, in time for them to make a proper offer, a notice of claim containing the particulars set out in Section 4(2). Where a claimant has delivered the claim containing the required details and has made an unconditional offer in writing to accept a particular sum, if the Tribunal's award is equal to or exceeds that sum the Tribunal must, in the absence of special reasons, order...
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