Land Compensation Act 1973

[F152ZBAdvance payments: land subject to mortgage exceeding 90% thresholdE+W

[F2(1)This section applies if—

(a)a request is made for an advance payment under section 52(1) in respect of land,

(b)the authority would be required by section 52(1A) or (1B) to make the advance payment if it were not for this section, and

(c)the land is subject to a mortgage the principal of which exceeds 90% of the relevant amount.]

(2)No advance payment is to be made to the claimant.

(3)But the acquiring authority must pay to the mortgagee the amount found under subsection (4), if—

(a)the claimant so requests, and

(b)the mortgagee consents to the making of the payment.

(4)The amount is whichever is the lesser of—

(a)90% of the value of the land;

(b)the principal of the mortgagee’s mortgage.

(5)The value of the land is the value—

(a)agreed by the claimant and the acquiring authority, or (failing such agreement)

(b)estimated by the acquiring authority.

(6)For the purposes of subsection (5) the value of the land is to be calculated in accordance with rule 2 of section 5 of the Land Compensation Act 1961 (market value), whether or not compensation is or is likely to be assessed in due course in accordance with rule 5 of that section (equivalent re-instatement).

(7)If there is more than one mortgagee, payment must not be made to a mortgagee until the interest of each mortgagee whose interest has priority to his interest is released.

(8)But the total payments under subsection (3) must not in any event exceed 90% of the value of the land.

(9)Subsection (10) applies if—

(a)the acquiring authority estimated the compensation,

(b)it appears to the acquiring authority that their estimate was too low and they revise the estimate,

(c)the condition in [F3section 52ZA(1)(c)] would have been satisfied if the revised estimate had been used instead of their estimate, and

(d)a request is made by the claimant in accordance with section 52(2).

(10)The provisions of section 52ZA(2) to (5) must be applied on the basis of the revised estimate.

(11)If—

(a)the acquiring authority estimated the value of the land,

(b)it appears to the acquiring authority that their estimate was too low and they revise the estimate, and

(c)a request is made by the claimant in writing,

any balance found to be due to a mortgagee on the basis of the revised estimate is payable in accordance with this section.]

Textual Amendments