Martyn John Garner & Anor. v Metropolitan Borough Council of Stockport

Compensation for compulsory acquisition is assessed in the statutory no-scheme world, disregarding the scheme and its underlying assumptions. Hope value may arise even where residential development has no realistic short-term prospect, provided a prospective purchaser would recognise a longer-term possibility of development.

In assessing that possibility for green-belt land, it is insufficient to consider the site’s contribution to green-belt purposes in isolation. The valuer must consider its position relative to alternative sites likely to be released. Valuation evidence must place the decision-maker in the position of a prospective purchaser and must account for the land’s existing value, planning prospects and relevant market evidence.

The claimants owned grazing land, car-park land and a telecommunications mast site at Hazel Grove, Stockport. The acquiring authority compulsorily acquired parts of the grazing and car-park land, together with drainage easements, for the Manchester Airport Relief Road.

The reference concerned compensation under the Land Compensation Act 1961 and related legislation. The principal dispute concerned the market value of the acquired grazing land in a no-scheme world, including whether it attracted hope value because of the prospect of future release from the green belt. Other issues concerned the value of the car-park land, severance and injurious affection, easements, disturbance and basic loss payment.

1. Compensation determined. The total compensation payable was £584,971. The Tribunal also determined the individual heads of claim and left costs to be dealt with under rule 10(10) of the Tribunal’s Procedure Rules.
2. Under section 5 of the Land Compensation Act 1961, the relevant valuation assumed a willing seller in an open-market sale and made no allowance for compulsory acquisition. The statutory assumptions required consideration of the land in a no-scheme world.
3. The grazing land was in the green belt. The Tribunal found that, in the no-scheme world, it made a strong contribution to checking urban sprawl and preventing the merger of Hazel Grove and Poynton. Its contribution to the remaining green-belt purposes was limited or uncertain.
4. The planning experts had concentrated on the site’s individual contribution to green-belt purposes. The correct assessment required comparison with other green-belt sites and consideration of where the land stood in the hierarchy of sites likely to be selected for development. Although there was no short-term prospect of development, continuing housing pressure and the agreed need eventually to release some green-belt land created a slender longer-term possibility of development.
5. The grazing land therefore had hope value. The Tribunal rejected both the claimants’ and the authority’s valuations and assessed the acquired land at £20,000 per acre, producing £184,500.
6. The car-park land was used for more than vehicle parking, including storage and other activities. A simple area-based apportionment of the capitalised rent was therefore preferred to an arbitrary valuation based on selected parking spaces. Its value was assessed at £107,900.
7. For the retained grazing land, loss of roadside access materially reduced value. The Tribunal assessed the diminution by reference to the land’s no-scheme value, its income value after acquisition and a premium payable by the likely special purchaser, producing £126,500. Agreed figures were adopted for the car park and telecommunications mast. Easement-related injurious affection was assessed at £825.
8. Disturbance included reasonably incurred professional expenditure. The claim for landowners’ time was reduced because the claimant’s later work was undertaken in a private capacity and should not be charged at his professional surveying rate.