[2023] UKUT 217 (LC)

All the statutory rights to compensation enjoyed by DT after 10 November 2014 were expressly assigned to the claimant when the sale of the Cheshire Lounge was completed on 2 June 2017. It is common ground that DT was free to sell its own interest, including in the reference land, and that its right to compensation has validly been assigned and can be pursued by the claimant. As the Court of Appeal explained in Dawson v Great Northern and City Railway Company [1905] 1 KB 260, DT could not deal with its land so as to increase the burden of compensation on National Highways, and the claimant cannot recover more in compensation than DT could have done, but it has not been suggested that its claim is any different from a claim which DT could have advanced.

The parties agree that the open market value of the reference land itself was £25,000. The claimant is entitled to that sum pursuant to section 5(2), Land Compensation Act 1961, together with a statutory loss payment of £1,875 pursuant to section 33A, Land Compensation Act 1973.

The parties also agree that National Highways should pay £90,000 towards the claimant’s pre-reference costs as compensation for disturbance under section 5(6), 1961 Act.

The main issue in the reference is the claimant’s claim under section 7, Compulsory Purchase Act 1965 for compensation for the injurious affection caused to the Cheshire Lounge at the valuation date in November 2014. It also seeks compensation for other losses unrelated to the value of the land (principally holding costs while the site has remained undeveloped, and the cost of works to the new access said to be required to make it suitable for the claimant’s use and equivalent to the original access over the reference land).

The claimant’s expert witnesses assessed the injurious affection claim as being equal to 90% of the open market value of the site at the valuation date, which would produce a compensation figure of £1,109,250. They put the claim for works to the new access at £268,000 and the claim for holding costs at £479,147. Taking account of the items which were agreed, at the commencement of the final hearing the total value of the claimant’s claim was a little over £2.1 million (plus interest). Earlier claims for loss of notional profits as a result of the delay in establishing a business from the site, and for the supposedly “abortive” costs of acquisition, were not pursued.

National Highways’ experts valued the claimant’s injurious affection claim at £210,000, that being 20% of the open market value of the site; they valued the disputed components of the rule 6 head of claim at £250,500 and valued the total claim at £577,250 (plus interest).