Swansea City & County Of v Griffiths & Anor

In compulsory-purchase valuation, land must be valued by reference to the open-market transaction at the valuation date. A tribunal cannot directly use later events to determine what a prospective purchaser would have anticipated at that date. The rule excluding scheme-generated enhancement is distinct from this temporal principle. A later planning decision may, in principle, provide indirect evidence of the authority’s earlier planning policy if the evidence supports that inference. An appellate court may uphold a decision containing an error of law where it is confident that the result would have been the same without it.

The acquiring authority appealed against a Lands Tribunal determination of compensation for two freehold parcels acquired compulsorily. The Tribunal valued the land at £500,000 on the basis that residential development could proceed within a relatively short period. The authority challenged the member’s reliance on residential permission granted at Tregof Farm in 1998, after the agreed valuation date of 27 February 1996. The central issues were whether that later event had improperly influenced the planning judgment and, if so, whether the error affected the valuation.

The appeal was dismissed unanimously, although the judges differed on whether the Tribunal had actually relied on the later planning permission as part of its reasoning.

1. The relevant valuation rule in the Land Compensation Act 1961 required assessment of the amount that the land might have realised on the open market at the valuation date. A later event could not directly form part of the hypothetical purchaser’s planning judgment because it would have been unknown at that date.
2. The Pointe Gourde principle, stated in [1947] AC 565, concerned the exclusion of value created by the scheme underlying the compulsory acquisition. It did not itself govern the separate question of how planning judgment should be assessed.
3. Neuberger LJ and Waller LJ recognised that a later planning decision might, in principle, be used indirectly to cross-check the planning authority’s earlier policy, if evidence justified treating the authority’s attitude as unchanged. The Tribunal’s reasoning did not establish that this was the basis on which the 1998 permission was used.
4. Latham LJ and Waller LJ considered that the Tribunal had used the Tregof Farm permission only as confirmation of its independently reached conclusion. Neuberger LJ considered that the permission had been taken into account as a confirmatory factor and that this was an error of law. A factor does not become admissible merely because it is secondary.
5. Neuberger LJ held that relief could nevertheless be refused where the appellate court was confident that the Tribunal would have reached the same result without the error. The Tribunal’s primary reasoning, the other planning evidence, the pre-valuation-date Fford Scott permission and the expert evidence made this one of the exceptional cases in which that conclusion could safely be reached.

The appeal was therefore dismissed.

1. Court of Appeal (Civil Division) [2004] EWCA Civ 398: dismissed the appeal.
2. Lands Tribunal: determined compensation at £500,000 on the basis that the land benefited from, or would obtain, residential planning permission within a relatively short period.