Eighth Schedule.—(COMPENSATION, ON COMPULSORY ACQUISITION, FOR SEVERANCE AND INJURIOUS AFFECTION.) (Hansard, 20 October 1954)

§ The Lord Advocate

I beg to move, in page 87, line 19, to leave out from "Schedule," to the end of line 48, on page 90, and to insert: the following expressions have the following meanings respectively— 'The compensation' means compensation such as is mentioned in paragraph (a) of section forty of this Act; 'the interest affected' means the interest in respect of which the compensation falls to be assessed, in so far as that interest subsists in land, other than the relevant land, which is affected by the injurious act or event; 1245 'the land affected' means the land in which the interest affected subsists; 'the injurious act or event' means the act or event in consequence of which the compensation falls to be assessed; 'other interest affected' means an interest other than the interest affected which subsists in the whole or part of the land affected and in respect of which compensation such as is mentioned in paragraph (a) of section forty of this Act is payable by virtue of the injurious act or event; 'qualified land' means land which immediately before the injurious act or event has an unexpended balance of established development value; 'the loss of development value' means the amount, if any, by which the value of the interest affected immediately before the injurious act or event, if calculated on the assumption that, until such time as the land affected might reasonably be expected to become ripe for new development, no use whatever could be made of that land, would exceed the value of that interest immediately after that act or event if calculated on the like assumption; 'the loss of immediate value' means the amount, if any, by which the difference in the value of the interest affected immediately before and immediately after the injurious act or event exceeds the loss of development value; 'the depreciation in restricted value,' in relation to an interest, means the amount, if any, by which the value of the interest, immediately after the injurious act or event, would be less than the value of that interest immediately before the act or event, if both values were calculated on the assumption that planning permission would be granted for development of any class specified in the Third Schedule to the principal Act but would not be granted for any other development. 2. If neither the land affected taken as a whole, nor any part of the land affected is qualified land, the amount of the compensation shall be the loss of immediate value. 3. If the land affected, taken as a whole, satisfies the following conditions, that is to say—

(a) that it is qualified land; and
(b) that no other interest affected subsists in a part only thereof,

the amount of the compensation shall be the aggregate of the loss of immediate value and whichever is the less of the following amounts, that is to say—

(i) the loss of development value; or
(ii) the amount of the unexpended balance of established development value of the land affected immediately before the injurious act or event:

Provided that if one or more other interests affected subsist in the whole of the land affected, and the aggregate of the loss of development value of the interest affected and of any such other interest or interests exceeds 1246 the amount mentioned in sub-paragraph (ii) of this paragraph, that amount shall be allocated between the interest affected and any such other interest or interests in proportion to the loss of development value of each of them respectively, and the amount of compensation payable in respect of the interest affected in addition to the loss of immediate value shall be the sum so allocated to that interest. 4. If the land affected, taken as a whole, does not satisfy the conditions mentioned in the last preceding paragraph, then, for the purpose of assessing the compensation in respect of the interest affected—

(a) the loss of development value of the interest affected and of any other interest affected shall first be ascertained with reference to the whole of the land affected;
(b) the land affected shall then be treated as divided into as many parts as may be requisite to ensure that each such part consists of land which either satisfies the conditions aforesaid or is not qualified land; and
(c) the loss of development value of each of the interests aforesaid, ascertained as aforesaid, shall then be apportioned between the said parts according to the nature of those parts and the effect of the injurious act or event in relation to each of them,

and the compensation payable in respect of the interest affected in addition to the loss of immediate value shall be the aggregate of the amounts which would be so payable by virtue of the last preceding paragraph if each such part had been the whole of the land affected. 5. In calculating value for any of the purposes of the preceding provisions of this Schedule in their application to compensation for damage to land not held with the relevant land, being damage sustained by reason of the construction or erection of works on the relevant land, no account shall be taken of the use, or the prospective use, of those works. 6. Where—

(a) the compensation includes an amount paid in respect of an interest in any land other than the land to which the acquisition related; or
(b) on such a sale as is mentioned in paragraph (b) of subsection (1) of section forty-one of this Act, the price paid included an amount in respect of damage sustained by an interest in land other than, but held with, the land to which the sale related, being damage sustained by reason of the severance of the land or by reason that the interest in that other land was injuriously affected,

and the said amount exceeds what was, or in the appropriate circumstances (as defined in the said section forty-one) would have been, the loss of immediate value of that interest, then, for the purpose of determining whether that other land or any part thereof has an unexpended balance of established development value at any subsequent time, there shall be deducted from the original unexpended balance of established development value of that other land an amount equal to the excess, or so much thereof as was, or in the appropriate 1247 circumstances (defined as aforesaid) would have been, calculated by reference to that balance, and the original balance of that land or that part thereof shall be treated as having been reduced or extinguished accordingly immediately before that subsequent time. 7. If in a case such as is mentioned in paragraph 2, 3 or 4 of this Schedule, or subparagraph (a) or (b) of the last preceding paragraph, so much, if any, of the compensation mentioned in that paragraph, or, as the case may be, the amount mentioned in that sub-paragraph, as was, or in the appropriate circumstances (as defined in section forty-one of this Act) would have been, attributable to the loss of immediate value of the interest in question was or would have been less than the depreciation in restricted value of that interest, then, (whether or not the land in question or any part thereof would apart from the provisions of this paragraph have had an original unexpended balance of established development value) for the purpose of determining whether at any time after the acquisition or sale the land in question or any part thereof has such a balance, but for no other purpose, it shall be deemed that immediately after the commencement of this Act a claim holding subsisted with an area consisting of the land in question and a value equal to seven-eighths of the amount of the difference. This Amendment, in effect, redrafts the provisions set out in the Schedule and it is rendered necessary by the Amendments already passed by the House, which require changes in the Schedule. At the same time, we have attempted to make the effect of the Schedule a little clearer. No radical change is involved in the Amendment although the phraseology is substantially varied. The redrafting of the Schedule does not affect the calculations, which remain as before. The depreciation caused by the injurious act or event is to be divided into two parts, the damage to the prospects of development or "loss of development value," and the damage to the existing use of the land, or "loss of immediate value" as it is called in the Amendment.

The compensation payable is to be the amount of the loss of immediate value plus, if the land affected has an unexpended balance, the loss of development value within the limits of that balance. That is provided by lines 33 to 43 which, with the definitions, replace the existing paragraphs 1 to 5. The next part of the Amendment, lines 44 to 66, deals with cases where two or more interests exist in the whole or part of the land injuriously affected. They are very substantially the same as the provisions in- 1248 serted by the House in Clause 21 to deal with the case of competing interests in land depreciated by planning restrictions. This replaces paragraph 7 of the Schedule and the regulations which were to have been made under it. Paragraph 5 reproduces paragraph 10 of the original Schedule.

Paragraphs 6 and 7 replace the present paragraphs 8 and 9 respectively, including the regulations which would have been necessary to apply them to cases of acquisitions by agreement in expectation of compulsory power.