Land Compensation Act 1961

General provisions E+W

5 Rules for assessing compensation. E+W

Compensation in respect of any compulsory acquisition shall be assessed in accordance with the following rules:

(1) No allowance shall be made on account of the acquisition being compulsory:

(2) The value of land shall, subject as hereinafter provided, be taken to be the amount which the land if sold in the open market by a willing seller might be expected to realise:

(3) The special suitability or adaptability of the land for any purpose shall not be taken into account if that purpose is a purpose to which it could be applied only in pursuance of statutory powers, or for which there is no market apart from F1 . . . the requirements of any authority possessing compulsory purchase powers:

(4) Where the value of the land is increased by reason of the use thereof or of any premises thereon in a manner which could be restrained by any court, or is contrary to law, or is detrimental to the health of the occupants of the premises or to the public health, the amount of that increase shall not be taken into account:

(5) Where land is, and but for the compulsory acquisition would continue to be, devoted to a purpose of such a nature that there is no general demand or market for land for that purpose, the compensation may, if the [F2 Upper Tribunal] is satisfied that reinstatement in some other place is bona fide intended, be assessed on the basis of the reasonable cost of equivalent reinstatement:

(6) The provisions of rule (2) shall not affect the assessment of compensation for disturbance or any other matter not directly based on the value of land:

and the following provisions of this part of this Act shall have effect with respect to the assessment.

Textual Amendments

F1 Words in s. 5(3) repealed (25.9.1991, subject to the restrictions referred to in S.I. 1991/2067, art. 4, Sch. 2 Pt. I para. 4) by Planning and Compensation Act 1991 (c. 34, SIF 28:1), ss. 70(a), 84(6), Sch. 15 Pt. I para. 1, Sch. 19 Pt. III (with s. 84(5)); S.I. 1991/2067, art. 3

F2 Words in s. 5 substituted (1.6.2009) by The Transfer of Tribunal Functions (Lands Tribunal and Miscellaneous Amendments) Order 2009 (S.I. 2009/1307), art. 1, Sch. 1 para. 40 (with Sch. 5)

Modifications etc. (not altering text)

C1 S. 5 applied (with modifications) by Acts listed in Chronological Table of the Statutes; and s. 5 modified by: Agriculture Act 1967 (c. 22), s. 50(8); Leasehold Reform Act 1967 (c. 88), ss. 29, 30, Sch. 4 para. 3(5); S.I. 1976/1218, art. 4; and Highways Act 1980 (c. 66), s. 261(6)

C2 S. 5 applied (with modifications) by National Heritage Act 1983 (c. 47, SIF 3, 78), s. 36(10), Water Act 1989 (c. 15, SIF 130), s. 155, Sch. 20 para 8(7) (with ss. 58(7), 101(1), 141(6), 160(1)(2)(4), 163, 189(4)–(10), 190, 193(1), Sch. 26 paras. 3(1)(2), 17, 40(4), 57(6), 58), Town and Country Planning Act 1990 (c. 8, SIF 123:1), s. 136(1)(a) and Aviation and Maritime Security Act 1990 (c. 31, SIF 39:2), s. 43(5), Sch. 2 para. 4(a)

C3 S. 5 applied (with modifications) (1.12.1991) by Water Industry Act 1991 (c. 56, SIF 130), ss. 167, 180, 223(2), Sch. 11 para. 8(7), Sch. 12 para. 3(2) (with ss. 82(3), 186(1), 222(1), Sch. 14 para. 6)

S. 5 applied (with modifications) (1.12.1991) by Water Resources Act 1991 (c. 57, SIF 130), ss. 61(6), 177, 225(2), Sch. 7 para. 5, Sch. 21 para. 3(2) (with ss. 16(6), 179, 222(3), Sch. 22 para. 1, Sch. 23 para. 6)

S. 5 applied (with modifications) (30.10.1994) by S.I. 1994/2716, regs. 91(5), 96(4)

S. 5 applied (with modifications) (1.4.1999) by S.I. 1999/481, reg. 7(2)

S. 5 applied (29.4.1999) by S.I. 1999/1006, reg. 7, Sch. para. 5

S. 5 applied (with modifications) (1.8.2000) by S.I. 2000/1973, reg. 12(13), Sch. 6 para. 6(2)

S. 5 applied (1.4.2000) by S.I. 2000/227, reg. 6, Sch. 2 para. 5(2)

S. 5 applied (with modifications) (W.) (1.7.2001) by S.I. 2001/2197, reg. 6, Sch. 2 para. 5(2)

C4 S. 5 applied by 1985 c. 68, s. 584B(5) (as substituted (6.4.2006 for E., 16.6.2006 for W.) by Housing Act 2004 (c. 34), s. 270(4)(5)(f), Sch. 15 para. 31; S.I. 2006/1060, art. 2(1)(d) (with Sch.); S.I. 2006/1535, art. 2(b) (with Sch.))

C5 S. 5 applied (with modifications) (E.) (4.8.2006) by Contaminated Land (England) Regulations 2006 (S.I. 2006/1380), reg. 1(1), Sch. 2 para. 5(2)

C6 S. 5 applied (with modifications) (W.) (10.12.2006) by The Contaminated Land (Wales) Regulations 2006 (S.I. 2006/2989), reg. 1(1), Sch. 2 para. 5(2)

C7 S. 5 applied (with modifications) (E.) (1.3.2009) by Environmental Damage (Prevention and Remediation) Regulations 2009 (S.I. 2009/153), reg. 1(1), Sch. 6 para. 6(1)

C8 S. 5(2)(4) applied (5.11.1993) by 1993 c. 42, s. 21, Sch. 7 para. 16(2)(a)

[F3 5A Relevant valuation date E+W

(1) If the value of land is to be assessed in accordance with rule (2) in section 5, the valuation must be made as at the relevant valuation date.

(2) No adjustment is to be made to the valuation in respect of anything which happens after the relevant valuation date.

(3) If the land is the subject of a notice to treat, the relevant valuation date is the earlier of—

(a) the date when the acquiring authority enters on and takes possession of the land, and

(b) the date when the assessment is made.

(4) If the land is the subject of a general vesting declaration, the relevant valuation date is the earlier of—

(a) the vesting date, and

(b) the date when the assessment is made,

and “ general vesting declaration ” and “ vesting date ” have the meanings given in section 2 of the Compulsory Purchase (Vesting Declarations) Act 1981.

(5) If the acquiring authority enters on and takes possession of part of the land—

(a) specified in a notice of entry, or

(b) in respect of which a payment into court has been made,

the authority is deemed, for the purposes of subsection (3)(a), to have entered on and taken possession of the whole of that land on that date.

(6) Subsection (5) also applies for the purposes of calculating interest under the following enactments—

(a) section 11(1) of the Compulsory Purchase Act 1965;

(b) paragraph 3 of Schedule 3 to that Act;

(c) section 85 of the Lands Clauses Consolidation Act 1845;

(d) section 52A of the Land Compensation Act 1973,

and references there to the date or time of entry are to be construed accordingly.

(7) An assessment by the [F4 Upper Tribunal] is treated as being made on the date certified by the Tribunal as—

(a) the last hearing date before it makes its determination, or

(b) in a case to be determined without an oral hearing, the last date for making written submissions before it makes its determination.

(8) Nothing in this section affects—

(a) any express provision in any other enactment which requires the valuation of land subject to compulsory acquisition to be made at a particular date;

(b) the valuation of land for purposes other than the compulsory acquisition of that land (even if the valuation is to be made in accordance with the rules in section 5).

(9) In this section—

(a) a notice of entry is a notice under section 11(1) of the Compulsory Purchase Act 1965;

(b) a payment into court is a payment into court under Schedule 3 to that Act or under section 85 of the Lands Clauses Consolidation Act 1845.]

Textual Amendments

F3 S. 5A inserted (31.10.2004) by Planning and Compulsory Purchase Act 2004 (c. 5), s. 103(2); S.I. 2004/2593, art. 2(a)

F4 Words in s. 5A(7) substituted (1.6.2009) by The Transfer of Tribunal Functions (Lands Tribunal and Miscellaneous Amendments) Order 2009 (S.I. 2009/1307), art. 1, Sch. 1 para. 41 (with Sch. 5)

6 Disregard of actual or prospective development in certain cases. E+W

(1) Subject to section eight of this Act, no account shall be taken of any increase or diminution in the value of the relevant interest which, in the circumstances described in any of the paragraphs in the first column of Part I of the First Schedule to this Act, is attributable to the carrying out or the prospect of so much of the development mentioned in relation thereto in the second column of that Part as would not have been likely to be carried out if—

(a) (where the acquisition is for purposes involving development of any of the land authorised to be acquired) the acquiring authority had not acquired and did not propose to acquire any of the land; and

(b) (where the circumstances are those described in one or more of paragraphs 2 to [F5 4B] in the said first column) the area or areas referred to in that paragraph or those paragraphs had not been defined or designated as therein mentioned.

(2) The provisions of Part II of the First Schedule to this Act shall have effect with regard to paragraph 3 [F6 and so far as applicable paragraph 3A] of Part I of that Schedule [F7 and the provisions of Part III of that Schedule shall have effect with regard to paragraph 4A.]

(3) In this section and in the First Schedule to this Act— “the land authorised to be acquired”—

(a) in relation to a compulsory acquisition authorised by a compulsory purchase order or a special enactment, means the aggregate of the land comprised in that authorisation, and

(b) in relation to a compulsory acquisition not so authorised but effected under powers exercisable by virtue of any enactment for defence purposes, means the aggregate of the land comprised in the notice to treat and of any land contiguous or adjacent thereto which is comprised in any other notice to treat served under the like powers not more than one month before and not more than one month after the date of service of that notice;

• “defence purposes” has the same meaning as in the M1 Land Powers (Defence) Act 1958;

and any reference to development of any land shall be construed as including a reference to the clearing of that land.

Textual Amendments

F5 “4B” substituted by virtue of Housing Act 1988 (c. 50, SIF 61), s. 78(4)

F6 Words inserted by New Towns Act 1966 (c. 44), Sch. Pt. I para. 3

F7 Words added by Local Government, Planning and Land Act 1980 (c. 65), s. 145(3)(b)

Modifications etc. (not altering text)

C9 S. 6 excluded by Land Compensation Act 1973 (c. 26), s. 6(3); modified ibid., s. 51(2)

C10 S. 6 modified (retrospective to 23.11.1994) by 1996 c. 61, s. 46(2)(4)

Marginal Citations

M1 1958 c. 30

7 Effect of certain actual or prospective development of adjacent land in same ownership. E+W

(1) Subject to section eight of this Act, where, on the date of service of the notice to treat, the person entitled to the relevant interest is also entitled in the same capacity to an interest in other land contiguous or adjacent to the relevant land, there shall be deducted from the amount of the compensation which would be payable apart from this section the amount (if any) of such an increase in the value of the interest in that other land as is mentioned in subsection (2) of this section.

(2) The said increase is such as, in the circumstances described in any of the paragraphs in the first column of Part I of the First Schedule to this Act, is attributable to the carrying out or the prospect of so much of the relevant development as would not have been likely to be carried out if the conditions mentioned in paragraphs (a) and (b) of subsection (1) of section six of this Act had been satisfied; and the relevant development for the purposes of this subsection is, in relation to the circumstances described in any of the said paragraphs, that mentioned in relation thereto in the second column of the said Part I, but modified, as respects the prospect of any development, by the omission of the words “other than the relevant land”, wherever they occur.

Modifications etc. (not altering text)

C11 S. 7 excluded by Land Compensation Act 1973 (c. 26), s. 6(3); modified ibid., s. 51(2)

8 Subsequent acquisition of adjacent land and acquisition governed by enactment corresponding to s. 7. E+W

(1) Where, for the purpose of assessing compensation in respect of a compulsory acquisition of an interest in land, an increase in the value of an interest in other land has, in any of the circumstances mentioned in the first column of Part I of the First Schedule to this Act, been taken into account by virtue of section seven of this Act or any corresponding enactment, then, in connection with any subsequent acquisition to which this subsection applies, that increase shall not be left out of account by virtue of section six of this Act, or taken into account by virtue of section seven of this Act or any corresponding enactment, in so far as it was taken into account in connection with the previous acquisition.

(2) Where, in connection with the compulsory acquisition of an interest in land, a diminution in the value of an interest in other land has, in any of the circumstances mentioned in the first column of the said Part I, been taken into account in assessing compensation for injurious affection, then, in connection with any subsequent acquisition to which this subsection applies, that diminution shall not be left out of account by virtue of section six of this Act in so far as it was taken into account in connection with the previous acquisition.

(3) Subsections (1) and (2) of this section apply to any subsequent acquisition where either—

(a) the interest acquired by the subsequent acquisition is the same as the interest previously taken into account (whether the acquisition extends to the whole of the land in which that interest previously subsisted or only to part of that land), or

(b) the person entitled to the interest acquired is, or derives title to that interest from, the person who at the time of the previous acquisition was entitled to the interest previously taken into account;

and in this subsection any reference to the interest previously taken into account is a reference to the interest the increased or diminished value whereof was taken into account as mentioned in subsection (1) or subsection (2) of this section.

(4) Where, in connection with a sale of an interest in land by agreement, the circumstances were such that, if it had been a compulsory acquisition, an increase or diminution of value would have fallen to be taken into account as mentioned in subsection (1) or subsection (2) of this section, the preceding provisions of this section shall apply, with the necessary modifications, as if that sale had been a compulsory acquisition and that increase or diminution of value had been taken into account accordingly.

(5) Section seven of this Act shall not apply to any compulsory acquisition in respect of which the compensation payable is subject to the provisions of any corresponding enactment, nor to any compulsory acquisition in respect of which the compensation payable is subject to the provisions of any local enactment which provides (in whatever terms) that, in assessing compensation in respect of a compulsory acquisition thereunder, account shall be taken of any increase in the value of an interest in contiguous or adjacent land which is attributable to any of the works authorised by that enactment.

(6) Where any such local enactment as is mentioned in subsection (5) of this section includes a provision restricting the assessment of the increase in value thereunder by reference to existing use (that is to say, by providing, in whatever terms, that the increase in value shall be assessed on the assumption that planning permission in respect of the contiguous or adjacent land in question would be granted for development of any class specified in [F8 Schedule 8 to the M2 Town and Country Planning Act 1971], but would not be granted for any other development thereof), the enactment shall have effect as if it did not include that provision.

(7) References in this section to a corresponding enactment are references to any of the following, that is to say,—

(a) section thirteen of the M3 Light Railways Act 1896;

(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . F9

[F10 (c) section 261(1) of the M4 Highways Act 1980 (or its predecessor, section 222(6) of the M5 Highways Act 1959);]

(d) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . F11

and, in subsection (1), includes references to any such local enactment as is mentioned in subsection (5).

Textual Amendments

F8 Words substituted by virtue of Town and Country Planning Act 1971 (c. 78), Sch. 24 para. 2

F9 S. 8(7)(b) repealed by Miscellaneous Financial Provisions Act 1983 (c. 29, SIF 99:1), Sch. 3

F10 S. 8(7)(c) substituted by Highways Act 1980 (c. 66), Sch. 24 para. 8

F11 S. 8(7)(d) repealed by Housing (Consequential Provisions) Act 1985 (c. 71, SIF 61), s. 3, Sch. 1 Pt. I

Modifications etc. (not altering text)

C12 S. 8 applied (with modifications) (30.10.1994) by S.I. 1994/2716, reg. 97

Marginal Citations

M2 1971 c. 78.

M3 1896 c. 48.

M4 1980 c. 66.

M5 1959 c. 25.

9 Disregard of depreciation due to prospect of acquisition by authority possessing compulsory purchase powers. E+W

No account shall be taken of any depreciation of the value of the relevant interest which is attributable to the fact that (whether by way of . . . F12 allocation of other particulars contained in the current development plan, or by any other means) an indication had been given that the relevant land is, or is likely, to be acquired by an authority possessing compulsory purchase powers.

Textual Amendments

F12 Word repealed by Town and Country Planning Act 1968 (c. 72), Sch. 11