Introduction
Denyer-Green (2014) assert that the Compulsory Purchase Order is a legal action by the government of any country to grant permission to particular bodies willing to undertake land or any property from a stubborn owner without his or her consent. If an area is currently possessed by private entities and the government finds it suitable to locate structures that will be of benefit to the majority of its citizens, and the owner of that piece of land is reluctant to sell it to the government, the latter is entitled to purchase that land forcefully from the owner. From the teleological theories, any action undertaken by an individual should yield maximum benefits for it to be considered positive. As such, under the compulsory purchase order, since the effects of the government purchasing land from an individual will be of benefit to majority of the citizens, it is henceforth declared positive in terms of its effects and consequences to the population.
Overview
The compulsory Purchase Order was first initiated in the United Kingdom and the Republic of Ireland to grant access to such bodies to land from their owners if the projected development is likely to benefit as many people as possible (Fox-Rogers, Murphy, and Grist, 2011). Notably, in the Republic of Ireland, Compulsory Purchase Order became most popular in the Ireland Republic under the National Development Plan following the massive program of upgrading roads. Besides, apart from road upgrade programs, the Compulsory Purchase Order is also critical in railway projects (Fox-Rogers, Murphy, and Grist, 2011).
However, if one feels pressed by the Compulsory Purchase Order, he or she is entitled to appeal to the High Court for the loss of land or any other property. Remarkably, the government sets aside huge sums of money for the plaintiff to be restored or projected further from the initial position that such a person was in before the Compulsory Purchase Order was undertaken and to improve the financial position of the complainant (Fox-Rogers, Murphy, and Grist, 2011). In most cases, compensation for Compulsory Purchase Order are usually based on a number of factors such as the anticipated costs of transferring to another location and acquiring new property, value of the property, in addition to additional payments (Denyer-Green 2014).
Following the new changes that have been enumerated by the local authorities, one may argue that the use of Compulsory Purchase Order by the acquiring authorities is good. However, it is also critical to value the rights of the owner. Consequently, the implication is that, a government or the authority that intends to acquire a certain land or property from the owner must meet up to an agreement by the owner (Heurkens, Adams and Hobma, 2015). Whenever somebody takes something rightly possessed by the owner without his or her consent, this may be taken as grabbing upon, which can be sued in a court of law. Therefore, it is important to blend the two; that is, both the agreement as the acquiring authority and the owner and the Compulsory Purchase Order.
Any local authority wishing to undertake a project that aims at supporting and developing a town as an extension of its existing shopping center may need to purchase an extensive land that will accommodate bigger houses that provide space for both parking lots and lodges. Once this has been accomplished, the local authorities would have played a great role towards raising the GDP of the economy by a large margin and uplifting the living standards of the local people within the town and the neighboring communities (Heurkens, Adams and Hobma, 2015). Definitely, this calls for a better housing and planning bodies to take action in building houses that can accommodate the above mentioned structures in the new compulsory purchased land. The new changes that were advanced in the Housing and Planning Act in 2016 have brought about several benefits to both the complainant and the compulsory purchase regime (Heurkens, Adams and Hobma, 2015).
Benefits
The new changes that have been advanced in the Housing and Planning Act has enabled the acquiring authorities to gain rights to survey land of their interest or that which they want to have a right over (Barnes, 2014). Consequently, this will help acquiring bodies which are capable of exercising compulsory purchase powers to issue a fourteen-days prior notice to the land owners and inhabitants the permission to undertake a survey on their land to facilitate its acquisition if it is found strategic and suitable for the projected program (O’Meara and Bruhn, 2013). However, in situations where the owner of the land is hostile and force is the only option for survey of the land to be undertaken, the magistrate may issue a warrant to the compulsory purchase personnel to enter into the land with the company of security personnel such as the police (Barnes, 2014).
Additionally, the changes in the Housing and Planning Act have impacted positively on both the land owners and the occupants. First, both landowners and the occupants have time for preparation concerning their next move taking into consideration the fourteen-days prior notice. The implication is that there are less uncertainty costs incurred by both parties. However, the uncertainty risks have been reduced further by the changes in the Notice to Treat and the General Vesting Declarations (O’Meara and Bruhn, 2013). As such, the most significant change in the Notice to Treat and the General Vesting Declaration is the fact that, the time frame to be issued to the landowners and occupants is to be increased from fourteen days to three months such that, they have enough time to relocate to new areas which the government have designed for them. In addition, the GVD system has also incorporated a notice of confirmation that assures both the landowner and the occupants that the land is to be compulsory purchased by the government for public betterment (O’Meara and Bruhn, 2013). Contrary, during the previous GVD regime, there were many uncertainties caused especially during the first two months of notice, as the landowners and occupants were not sure whether the land was to be taken or not, since there was no confirmation letter sent to the landowners and the occupants.
Moreover, with the new rules in the Compulsory Purchase Order and Compensation regime as outlined in the Housing and Planning Act, an occupier in the government’s land of interest can send a counter notice after Notice–to -treat has been sent (O’Meara and Bruhn, 2013). This counter notice must be taken into consideration in at least twenty-eight days after the Notice-to-Treat which accounts for three months. As a result, this gives the land occupiers more time to arrange properly and adequately for their new relocation.
Equally important, there are changes in the advance payments. In this case, the acquiring authority is required by law to pay ninety per cent of the initial estimate of the claim within the first three months of the formal request of possession (Sams, 2013). In circumstances where the set timescales of advance payments were not adhered to by the acquiring authorities, the Act has provided for prompt advance payments by ensuring that timescale is honored to facilitate relocation. As a result, if the set grace period is not met, the acquiring authority is supposed to incur a certain interest on top of the unpaid dues.
Valuation
Valuation is a forward-looking exercise and there is none of the circumstances that is exactly the same as the one that comes before it. As such, when experts want to carry valuation of particular projects, they must bear in mind that price of commodities keeps on fluctuating and may be influenced by different factors (O’Meara and Bruhn, 2013). In all circumstances however, an expert should make sure that the decision he or she makes is independent and one that is grounded on the best available information. Further, the expert should ensure that the information is verifiable to the greatest possible extent. Besides, the given piece of information must be formulated with the best methodology as well as being presented to the court of law in the most appropriate and coherent manner (O’Meara and Bruhn, 2013).
Whenever claims regarding compensation of compulsory purchase of properties such as land or business premises are raised, the concept of extinguishable valuation can arise. Consequently, any business or landowner who is confronted by the issue of compulsory purchase order will be forced to relocate (Ty,Van’ Westen and Zoomers, 2013). As such, the concept of extinguishable means that, if the acquiring authority realizes that the cost of relocation is higher than the present value of the land or business, it may be tempted to lower the compensation figures. However, following a case between the Director of Buildings and Lands against Shung Fung Ironworks Limited, it is clear that, the difference between the present value of the business or land and cost of relocation should not be the major decisive criteria for compensation (Sams, G., 2013). As such, experts can either quantify the extinguishable value or compare its value to the total anticipated cost of relocation and come up with a reasonable opinion.
Survey and Findings
From the cabinet’s recent meeting regarding how they would develop a town center within its administrative area as part the modernization program, they had noticed several properties that are not part of the properties owned by the local authority. Such included a narrow parcel of freehold land of 500 sq. ft., half of which will not be needed long term; a vacant freehold yard of 2,000 sq. ft.; a freehold pair of semi-detached Victorian houses; an owner occupied freehold shop with upper parts, in a terrace the remainder of which is already owned by the local authority. As such, these are critical properties that the governments can compulsorily purchase to upgrade its current shopping center (Sams, 2013). For example, the 2000 sq. ft. can be used to establish a mall along a super highway that will imminently lead to improvements and call for more accommodation works. As a result, the 500 sq. ft. could be used to cater such services such as a parking lot for vehicles and minor games for clients such as swinging and swimming. The owner freehold shop could be used as a storage kiosk for luggage whereas the Victorian Houses could be used as accommodation houses and part of it modified to create room for hotels and restaurant. In doing so, this will also lead to emergence of other shops, hotels, and restaurants that will play complimentary role with the main mall thereby resulting to town establishment in the long run.
Political Issues
However, a few political issues need to be addressed keenly because whenever politics creeps in to some matters of great importance, almost everything disappears. For example, corruption has been the greatest menace occurring in most institutions (O’Meara and Bruhn, 2013). Thus, there should be mechanisms of addressing corruption in every corner of this world. Evidently, many government officials unscrupulously put into their pockets public money instead of making such funds serve the interests of the populace. Such officials do not realize that the interests of the public are above their self-interests.
Appendix
The trend in prices for UK properties
The table below reveals that the cost of a piece of land or structure differs significantly in the United Kingdom in relation to the geographical location. However, one can be able to determine on average, the optimal cost of land after considering all the value of land in most regions.
Table 1: Price Valuation
| location | Size in square feet
| price of land in million pounds
|
| ||
| Wenlock road
| 11070
| 8,325,000
| |||
| Beam reach business park
| 44942
| 7,200,000
| |||
| Tudor road
| 13197
| 7,100,000
| |||
| Chapel place
| 4900
| 5,500,000
| |||
| Long lane
| 5953
| 4,250,000
| |||
| Junction road
| 5379
| 4,000,000
| |||
| Devonshire street | 3991 | 3,500,000 | |||
| Average cost per square feet | 426
| ||||
| Source (http://www.rightmove.co.uk/commercial-property-for-sale/London.html) | |||||
From the valuation above, the average cost per square feet of land is approximately four hundred and twenty-six thousand pounds. Therefore, the total cost for the two thousand freehold yard would be eight hundred and fifty-two thousand pounds. On the other hand, the 500 sq. ft. would cost approximately two hundred and thirteen thousand pounds. The approximate cost of a freehold semi-detached Victorian house is around twenty-four million pounds. As such, a single figure representing the total cost of acquisitions within the CPO area would revolve around twenty-five millions and sixty five thousand pounds.
Objectives of the Valuation and Legal
The primary objective of this valuation report was to determine the adequacy of the current value of the land that would help in the calculation of compensation towards the displaced people from the compulsory purchased land and describe the changes over the years as well as analyzing the financial status. What the figures reveal from the picture diagram is that, for the projected scheme to be sustainable in the long-run, contribution of fund needs to be increased. In addition, the funding adequacy of this project would be to cater for the normal cost as well as any other costs such social costs that is sufficiently efficient to cater for the unfunded liabilities (Altes, 2014). The state statute defines the contribution of each shareholder that declares by how much each individual will have to pay towards development and sharing of profits. The diagrams above reflect on the development of value assets and the history of contribution. As a result, the best time to undertake the scheme is when all the necessary contributions have met an all costs incurred (Altes, 2014). The legal basis for all the claims laid regarding compulsory purchase acquisition as well as compensation that results are all contained in the Compulsory Purchase Order and Compensation Act of 2013.
Bibliography
Altes, W.K.K., 2014. Taking planning seriously: Compulsory purchase for urban planning in the Netherlands. Cities, 41, pp.71-80.
Barnes, M. (2014). The law of compulsory purchase and compensation. Oxford, United Kingdom: Hart Publishing, 2014.
Denyer-Green, B. (2014). Compulsory purchase and compensation. Abingdon, Oxon, Routledge.
Fox-Rogers, L., Murphy, E. and Grist, B., 2011. Legislative change in Ireland: A Marxist political economy critique of planning law. Town Planning Review, 82(6), pp.639-668.
Heurkens, E., Adams, D. and Hobma, F., 2015. Planners as market actors: The role of local planning authorities in the UK’s urban regeneration practice. Town Planning Review, 86(6), pp.625-650.
O’Meara, T. and Bruhn, A., 2013. Compulsory Annuitisation: A Policy Option for Australia? Australasian Accounting Business & Finance Journal, 7(3), p.5.
Sams, G., 2013. Compulsory purchase and compensation update-2013. Journal of Property Investment & Finance, 31(6), pp.602-609.
Ty, P.H., Van Westen, A.C.M. and Zoomers, A., 2013. Compensation and resettlement policies after compulsory land acquisition for hydropower development in Vietnam: policy and practice. Land, 2(4), pp.678-704.
