Landlink (Stoke Mandeville) Ltd v The Secretary of State for Transport

For compensation for severance, the primary valuation of retained land is made as at the date of severance. Later events cannot change that valuation, but later steps that reduce or increase the damage actually sustained may affect compensation under the principle of equivalence. The valuation date remains unchanged.

Post-valuation assurances may be relevant in principle, but their effect must be supported by evidence and assessed in the context of other material changes. A party cannot rely on a late assurance in isolation to reduce compensation. Later comparable sales may assist only where they reliably inform the market at the valuation date.

Landlink (Stoke Mandeville) Ltd owned a 27-acre site allocated in part for older people’s accommodation. The Secretary of State for Transport compulsorily acquired 2.7 acres for a new road associated with HS2, leaving two parcels that could no longer accommodate the original 162-unit retirement scheme.

The parties agreed a counterfactual value for the whole site assuming appropriate alternative development, but disputed the value of the retained land and the effect of the Secretary of State’s later assurances about access and the purchase of a strip of land. They also disputed pre-reference professional fees. The Tribunal considered whether those assurances could reduce compensation for severance under section 7 of the Compulsory Purchase Act 1965. Landlink’s related appeal against the local planning authority’s negative certificate of appropriate alternative development was uncontentious.

The Tribunal allowed Landlink’s appeal against the negative certificate and granted a certificate for the agreed 162-unit retirement scheme. It assessed total compensation at £10,624,971, plus statutory interest.

1. Separate statutory losses. The Land Compensation Act 1961 and the Compulsory Purchase Act 1965 govern distinct losses: the value of land taken and damage to retained land by severance. The parties’ single before-and-after calculation was convenient, but the statutory scheme contemplates separate assessments. The Tribunal cautioned that combining them could create difficulties, particularly when considering later events, but did not decide whether the parties’ method changed the amount payable.
2. Valuation date and later events. For land taken, Rule 2 and section 5A of the 1961 Act required valuation at the relevant valuation date and barred adjustment for anything happening afterwards. For section 7 damage, the primary before-and-after valuation likewise uses the date of severance. The Tribunal followed Castlefield Properties Ltd v National Highways [2023] UKUT 217 (LC) on that point. It disapproved the suggestion in Waterworth v Bolton MBC (1979) 37 P&CR 104 (LT) that injurious affection could be valued by a different approach.
3. Actual damage and equivalence. Section 7 compensates the whole damage sustained, not simply the diminution in value at severance. Applying the principle of equivalence, later works, benefits or mitigation may reduce or increase that damage without changing the primary valuation date. Depending on the circumstances, a further valuation may be needed to account for later relief and any damage suffered in the interim. The Tribunal applied the principles in Horn v Sunderland Corporation [1941] 2 KB 26 and Bwllfa v Pontypridd Waterworks Company [1903] AC 426.
4. Assurances and valuation evidence. The Secretary of State’s assurances about access and the land strip were offered years after the valuation date. The Tribunal disregarded them because they came after pleadings and expert evidence had closed, and there was no adequate evidence of their effect on value. Their effect also could not be isolated from other post-date changes. The Tribunal therefore valued the southern retained parcel at £170,000 and the severed triangle at £20,000. In assessing the original site, it applied the guidance in Chifley Holdings Ltd (BVI) v The Commissioners for HMRC [2024] UKUT 301 (LC) and excluded later unit sales affected by intervening market changes.
5. Disturbance. Reasonable professional expenses incurred as a consequence of the acquisition were recoverable under Rule 6. No specific duplication or unreasonableness was established, so the full pre-reference fees claimed were allowed.

The award comprised £9,960,000 for land taken and injurious affection, £564,971 in pre-reference fees, £75,000 for basic loss and £25,000 for occupier’s loss.

Landlink appealed under section 18 of the Land Compensation Act 1961 against the local planning authority’s negative certificate of appropriate alternative development. The Secretary of State agreed that the certificate should be granted for the 162-unit scheme. The Upper Tribunal allowed the appeal. No earlier judicial decision in the compensation reference is identified.