What is a Compulsory Purchase Order?
Discovering that the property you own or occupy may be compulsorily acquired can be very distressing, particularly if you are unaware of where you stand legally.
Below we examine in more detail the question of ‘what is a compulsory purchase order?’, including your rights as an owner and what an authorised body is required to do by law to acquire your land without your consent.
What is a compulsory purchase order?
A compulsory purchase order is a legal function that gives authorised bodies in England and Wales the power to acquire property or land in circumstances where the owner is not willing to sell by agreement.
Under the Acquisition of Land Act 1981 (and other Acts of Parliament) enabling powers are conferred on authorised bodies if a proposed development is considered to be in the public interest, for example, building a new bypass to reroute traffic away from built up areas.
Compulsory purchase powers are commonly exercised by local or highway authorities, and can be an important tool to acquire the land needed to facilitate redevelopment, regeneration and essential infrastructure.
What is a compulsory purchase order notice?
There are statutory procedures that the public body will need to follow to begin the process of seeking to acquire your land without your consent.
In particular, the acquiring authority must serve notice of a proposed compulsory purchase order on all qualifying persons. A qualifying person includes the owner, tenant, lessee and occupier of the property or land.
The notice must state the following:
- the effect of the order
- that it is about to be submitted for confirmation, and
- the time (not being less than 21 days from service of the notice) within which, and the manner in which, objections to the order can be made.
When serving notice of an order on qualifying persons, the acquiring authority is also expected to send to each one a copy of the authority’s statement of reasons for making the order.
The statement of reasons should include an outline of the authority’s purpose, together with their justification in seeking to acquire the land for compulsory purchase. The acquiring authority must be able to demonstrate that that there is a compelling case in the public interest.
What is a compulsory purchase order press notice?
The general public will also need be notified of the proposed compulsory purchase through notices affixed to the land in question, as well as newspaper notices.
The acquiring authority is statutorily required, over two successive weeks, to publish a notice in one or more newspaper circulating in the locality in which the land comprised in the order is situated.
What is a compulsory purchase order public inquiry?
If you oppose the making of a compulsory purchase order you can raise your objections in writing within the period specified in the notice (a minimum of 21 days). Objections may also be made by third parties, including members of the public, for example, interest groups opposed to the environmental or social consequences of the proposed project.
If no objections are made, the compulsory purchase order will be considered on its merits and either confirmed, modified or rejected without the need for any form of hearing. If valid objections are received and not withdrawn, objections can be considered through a written representations procedure. Often, however, in the interests of transparency, a public local inquiry will be held.
A public inquiry resembles a trial in its set up, with argument being heard from both sides. The inquiry will not, however, result in a court style judgment. Rather, at its conclusion, the inspector chairing the inquiry will report back to the appointing minister who will make a decision based on the inspector’s report.
What is a compulsory purchase order legal challenge?
Once the minister has confirmed a compulsory purchase order, notices will again be placed in the newspaper, affixed to land, and served on qualifying persons. Once an order has been confirmed, there is a six week period from the date the notice is first published within which ‘any person aggrieved by a compulsory purchase order’ may question its validity through an application to the High Court.
The making of a compulsory purchase order can be challenged on the grounds that:
- there is no power in the Acquisition of Land Act 1981, or the enabling Act, for the order to be authorised, or
- the procedural requirements of the relevant Acts and regulations have not been complied with, and
- the interests of the person applying to the High Court have been substantially prejudiced.
What is a compulsory purchase order operative date?
If a compulsory purchase order is confirmed without challenge, it will become operative on the date on which the notice of its confirmation is first published. The acquiring authority must issue the confirmation notices within six weeks of the date of the order being confirmed.
The acquisition process under a compulsory purchase order will proceed by one of two routes, either by the acquiring authority serving a notice to treat or by executing a general vesting declaration.
What is a compulsory purchase order notice to treat?
There is no prescribed form for a notice to treat but it must ask you to set out your interest in the property and particulars of compensation that you seek for its value. The notice to treat must be served within three years of the date on which the compulsory purchase order became operative. The notice will then remain effective for a further three years.
Thereafter, once the crucial stage of actually taking possession is reached, the acquiring authority is required to serve a notice of its intention to gain entry. In most cases this will be not less than three months beginning with the date of service of the notice. Title to the land is subsequently transferred by a normal conveyance.
What is a compulsory purchase order general vesting declaration?
A general vesting declaration can be used as an alternative to serving a notice to treat. It replaces the notice to treat, notice of entry and the conveyance with one procedure that automatically vests title in the land with the acquiring authority on a certain date. This procedure may be used where the acquiring authority wishes to obtain title with minimum delay.
The general vesting declaration must be executed within three years of the date on which the compulsory purchase order became operative. In most cases, the acquiring authority must give at least three months’ notice before taking possession of your property.
What is a compulsory purchase order compensation claim?
In exchange for your property or land being compulsorily acquired you will be entitled to compensation. The assessment of compensation is based on the principle of equivalence. This means that you should be no worse off in financial terms after the acquisition than you were before, although equally you should not be any better off.
Broadly speaking, compensation can be claimed under the following categories:
- the value of your property or land
- the cost of acquiring and moving to a new property, ie; disturbance payments
- the cost of seeking professional advice, for example, surveyor fees in preparing and negotiating a compensation settlement, together with legal fees including conveyancing costs.
The value of your property or land is the amount that it might be expected to realise if sold on the open market by a willing seller, disregarding any increase or decrease attributable to the proposed development underlying the compulsory purchase order. Here it is assumed that you would only be willing to sell at the best price that you could reasonably achieve in the open market.
Should I seek legal advice in relation to a compulsory purchase order?
The law and procedure relating to compulsory purchase orders is highly complex. Moreover, the financial and practical implications for you as an owner or occupier of land can be far reaching.
In the event that you are notified of a proposed compulsory purchase order it would be prudent to seek early legal advice. An expert in planning law can help you to understand ‘what is a compulsory purchase order?’.
Your specialist legal advisor can also give you guidance on how to raise objections to a proposed order, provide representation at a public inquiry and help you to assess the level of compensation you should be seeking.