HL Deb 09 November 1944 vol 133 cc1087-100

Certified after-damage value of land to be taken in certain circumstances as its value for compensation on compulsory purchase.

1.—(1) Where the subject of a compulsory purchase, the compensation for which is by virtue of Section fifty-two of this Act to be assessed subject to the rule set out in subsection (1) of that section, is or comprises an interest in the whole of the land in a hereditament within the meaning of the War Damage Act, 1943. the value of which is required by that Act to be ascertained by reference to its state after war damage and to an assumed sale thereof, the value of the said land for the purposes of the ascertainment of the compensation for the purchase shall be taken to be such amount as may be certified by the War Damage Commission to he the value of the hereditament as ascertained as aforesaid (in this Schedule referred to as the "certified after-damage value" of that land), subject however to the two next succeeding sub-paragraphs.

(2) The preceding sub-paragraph shall not have effect if between the occurrence of the war damage and the time when the notice to treat is served the land in the hereditament has been brought into a state such as to make it capable of being as beneficially used while remaining in that state as it was immediately before the occurrence of the war damage.

(3) If the land in the hereditament has not been brought into such a state as aforesaid, but there is any material difference either—

  1. (a) between the state of the land in the hereditament after damage by reference to which the value thereof falls to he ascertained under the War Damage Act, 1943, and its state at the time when the notice to treat is served; or
  2. (b) between the incumbrances, if any, to which the said land was subject immediately after the occurrence of the war damage and the incumbrances, if any, to which it is subject at the time when the notice to treat is served, being incumbrances of a kind required by the said Act to be taken into account in ascertaining the value of the hereditament,
the value of the said land for the purposes of the ascertainment of the compensation for the purchase shall be taken to be the certified after-damage value thereof adjusted by adding, or by subtracting, as the case may require, the amount by which the value of the hereditament as required to be ascertained under the said Act would have been greater or less if that value had fallen to be ascertained by reference to the state of the hereditament at the time when the notice to treat is served, and if it had been subject immediately after the occurrence of the war damage to all in-cumbrances of any such kind as aforesaid to which it is subject at the time when the notice to treat is served and to no other incumbrances of any such kind.

(4) Where this paragraph has effect as respects a purchase the subject of which comprises, but does not consist solely of, the interest in question in the land in the hereditament, compensation for the purchase shall be ascertained, and all statutory provisions relating to the ascertainment thereof or to the carrying out of the purchase or to matters connected therewith shall have effect, subject to any agreement between the purchasing authority and other parties concerned, as if the interest in question in that land had been purchased separately and separate notices to treat had been served accordingly, and had been served simultaneously.

Compensation for compulsory purchase of several interests in land to be ascertained in certain circumstances by apportionment of certified after-damage value thereof.

2.—(1) Where by virtue of paragraph 1 of this Schedule the value of the land comprised in a hereditament is to be taken for the purposes of the ascertainment of compensation to be its certified after-damage value (or that value as adjusted), and notices to treat have been served in respect of two or more interests in the whole of that land on the same date or within such period as may he prescribed under paragraph 3 of this Schedule as respects that land, the compensation to be paid for the purchase of each of these interests shall be ascertained in accordance with the following provisions of this paragraph.

(2) The amount representing the value of each of those interests as it would have fallen to be ascertained if this paragraph had not had effect in relation thereto shall he agreed, assessed or determined in accordance with the provisions of sub-paragraphs (3) to (7) of this paragraph, and the compensation to be paid for the purchase of each interest shall be the proportion of the certified after-damage value of the land, or of that value as adjusted, as the case may be, which the amount agreed, assessed or determined in respect of that interest hears to the aggregate of the amounts agreed, assessed or determined in respect of the several interests:

Provided that if the interests in question do not include all interests in the land, an amount representing the value of any excluded interest, as it would have fallen to be ascertained if that interest had been purchased and this paragraph had not had effect in relation thereto, shall he agreed, assessed or determined in accordance with the said provisions and added to tie said aggregate.

(3) If the values of the several interests in question and of any excluded interest are not otherwise agreed, the claimant in respect of each of the interests in question, and the acquiring authority as respects any excluded interest, shall cause an estimate of the value of that interest to be made and transmitted to an officer of the Valuation Office appointed by the Commissioners of Inland Revenue who, after considering the estimates, shall take steps in accordance with rules for securing if possible agreement between the claimants, and, if there is any excluded interest, the purchasing authority, as to the value of each interest.

(4) In default of agreement as to the value of any interest the said officer shall make an assessment of the value of that interest.

(5) The costs of the employment by a claimant of a person skilled in valuation to advise or act for him for the purposes of either of the two last preceding sub-paragraphs on a purchase by a local or public authority within the meaning of the, Acquisition of Land (Assessment of Compensation) Act, 1919, shall be paid by the authority.

(6) If any claimant, or, if there is any excluded interest, the purchasing authority, is aggrieved by an assessment made by the said officer, the claimant or the authority may in accordance with rules require the value of the interest dealt with by the assessment to be determined by one of the panel of arbitrators appointed under Section one of the said Act of 1919.

(7) If in respect of any of the interests in question no claim is duly made within the time prescribed by rules, an independent person skilled in valuation may be appointed in accordance with rules to act for the purposes of sub-paragraphs (3) to (6) of this paragraph in respect of that interest, and those subparagraphs shall have effect as if all things done thereunder by the person so appointed had been July authorized by all persons concerned in respect of the interest in question to be dons by that person as agent for them.

(8) Where the last preceding sub-paragraph has had effect as respects any interest and the value thereof has been agreed or assessed under sub-paragraph (3) or (4) of this para- graph, if any person who would have been entitled but for this paragraph to have any question of disputed compensation in relation to that interest referred to arbitration in accordance with the said Act of 1919 shows in accordance with rules that the fact that no claim was made as aforesaid was not attributable to any default on his part, he may in accordance with rules require the value of that interest to be determined by one of the panel of arbitrators appointed under Section one of the said Act of 1919, and if the compensation on the basis of the value of the interest as so determined is greater or less than the compensation on the basis of the value thereof as agreed or assessed as aforesaid, the difference shall he recoverable by the person entitled to the compensation from the purchasing authority or by the authority from him, as the case may be.

(9) The costs of any arbitration under subparagraph (6) or (8) of this paragraph, including any fees charges and expenses of the arbitration or award, shall be in the discretion of the official arbitrator, who may direct to and by whom and in what manner those costs or any part thereof shall be paid, and the official arbitrator may in any case disallow the costs of counsel.

(10) The amount of any costs that an authority are liable to pay by virtue of sub-paragraph (5) of this paragraph, or of any arbitration under sub-paragraph (6) or (8) thereof, shall be determined by reference to scales to be prescribed by the Treasury, and in case of difference as to the amount of any such costs they shall, if payable under sub-paragraph (5) of this paragraph, be taxed in such manner as the Treasury may direct, or, if payable under direction of an official arbitrator, be taxed by him or in such manner as he may direct.

Rules for giving effect to preceding provisions of this Schedule.

3. Provision may be made by rules made by the Lord Chancellor, after consultation with the Reference Committee referred to in the Acquisition of Land (Assessment of Compensation) Act, 1919, for giving effect to the provisions of the two preceding paragraphs, for prescribing anything thereby required to be determined by rules, and in particular, but without prejudice to the generality of the power conferred by this paragraph,—

  1. (a) for the determination of any question whether land has been brought into a state such as is mentioned in sub-paragraph (2) of paragraph I of this Schedule, of any question Whether there is any such material difference as is mentioned in sub-paragraph (3) of that paragraph, and, in a case in which there is any such difference, how the certified after-damage value ought to be adjusted;
  2. (b) for regulating the proceedings for the ascertainment of compensation, where the value of any land for the purposes of the ascertainment thereof is to be taken to he the certified after-damage value of the land (or that value as adjusted), so as to secure that the requisite certificate and particulars of any requisite adjustment may be rendered available for those purposes;
  3. 1091
  4. (c) for fixing the period referred to in subparagraph (1) of paragraph 2 of this Schedule within which, where a notice to treat has been served as respects an interest in the whole of the land in a hereditament, such a notice in respect of any other interest therein must be or have been served in order to render the provisions of that paragraph applicable to the ascertainment of the compensation to be paid for the purchase of those interests, and for securing, so far as may be practicable, that all such notices intended to be given as respects interests in the whole of the land in a hereditament shall be given within the period fixed;
  5. (d) for specifying limits of time within which things required or authorized by paragraph 2 of this Schedule must be done, with or without power to persons designated by the rules to extend to such limits;
and references in paragraph 2 of this Schedule to rules shall be construed as references made under this paragraph.

The noble and learned Viscount said: Your Lordships have before you the Eighth Schedule printed in the Paper. I think it would be desirable to state both for the benefit of your Lordships who are following this discussion and others also what is the principle that is embodied in this Schedule. It looks very complicated but it really is simple. It deals with the appropriate principles regarding the compulsory purchase of "blitzed" properties as they stand after war damage. The principle of paragraph 1 is to accept the value of a "blitzed" property as fixed by the War Damage Commission or as fixed on appeal from that body for the purpose of assessing the amount of compensation payable for the compulsory purchase of interests in the property. That will secure two things. One result will be that it will avoid two separate valuations. Both valuations are with reference to the March, 1939, standard. It is obvious that it is most undesirable to make the machine go round twice when the question is the same. If the question has been correctly answered the answer should again be the same. The second point is it will secure that the owner receives a war damage value payment fixed on the value of his property as it stands. After the damage the property has a certain value and if that property has been compulsorily purchased the compensation is fixed on the basis that it is either of greater value or of less value. He has to stand by the amount whether it is above or below. Those are the two principles in the first paragraph.

Whether you look at it from the point of view of equity or whether you look at it from the point of convenience I do not think your Lordships will doubt that it is right and ought to receive general support. Owners and others who have to act upon valuations and also those who have to pay the proper amount of compensation would probably prefer this procedure rather than have an immense number of cases dealt with. With a view to avoiding that it is indispensable that we should make a provision of this sort. Then the principle of paragraph 2 is this. It is to provide a means of fixing the compensation for several interests in a single "blitzed" property by negotiation instead of by independent valuation. I think everybody will agree with that principle. If that can be done it is I think a good thing to do. Under the compensation law a notice to treat has to be given not as to the property cited but as to the particular interests, and they may be like leaves in Vallambrosa. In some cases it will lead to great complication. You have three notices to treat, three separate sets of compensation proceedings, and the factors that will lead to the right compensation are the same in each case. Therefore it is quite foolish to have an arrangement under which that procedure would have to be gone through over and over again. It all arises because there is no one person who has jurisdiction to bring the parties together.

If your Lordships will study paragraph 2 at your leisure you will see that it provides that the district valuer, the person who presumably is to be concerned in all separate valuations, should have, if possible, the owner or the owners of the various interests brought together and discuss with them the proper apportionment and settle the actual amounts due to each. It is thought that it would seldom be necessary to resort to compulsion. But this is obviously the most sensible thing to do and there is every reason to suppose that it will work well. District valuers generally will command the confidence of the owners and be accepted by them as impartial experts, but it is necessary to provide for compulsion and independent valuation in default of agreement and that is why paragraph 2 is of regrettable length. That, however, is what it means if I have explained it clearly. I could go on and give more detail.

We have informed the associations of local authorities of the Government's intention to make this provision and the associations of local authorities do not feel in all cases satisfied that the valuation of the "blitzed" land by the War Damage Commission should be taken. It is right to inform your Lordships that the associations' acceptance of paragraph 1 is limited to cases where the valuation is made on appeal, from the Commission, by one of the referees. I only have to say that if that view were accepted it really would knock die bottom out of these proposals. I do not think we should be justified in doing that. I hope that the reasons of equity and convenience to which I have referred are going to prevail in the judgment of the Committee. It is not a question of getting everything perfect. We have got a very large piece of work in front of us and it is most important that it should be done promptly. I am convinced that if, for the sake of precision, we do not allow this grouping of claims so that a single judgment may decide the main figure payable we shall be sorry for it in the long run. I hope this now Schedule will be studied carefully before it finally and absolutely becomes law. I will not go into more detail because I do not think it is desirable at the moment, but it is on the Order Paper to he studied.

Amendment moved— Page 83, insert the said new Schedule.—(The Lord Chancellor.)

5.4 P.m.


had given Notice of an Amendment to the proposed new Schedule—namely, in paragraph 1, at end of sub-paragraph (1), to insert "and to a right in the acquiring authority to exercise, within one month of the service of the notice to treat, an option to require that, instead of the compensation being as aforesaid, the compensation shall be as determined by one of the panel of arbitrators appointed under Section one of the Acquisition of Land (Assessment of Compensation) Act, 1919."

The noble Lord said: The noble and learned Viscount has, to a certain extent, answered in advance some of the points that I wish to raise, but I think they are worthy of more consideration. Before the Bill was introduced in another place the Minister of Town and Country Planning consulted the associations of local authorities on the subject of the ascertainment of compensation for the purchase of land valued under the War Damage Act, 1943. A reply was sent on behalf of the local authorities on September 27, 1944, from which I would like to read this extract: Local authorities have a strong objection to being hound by a valuation fixed in proceedings to which they have not been parties…It is suggested, therefore, that the first of the three clauses should be restricted to cases in which the value of a hereditament has been determined by a referee under the War Damage Act, and that the second of the three clauses should be restricted to those cases and should provide for a direct reference to the official arbitrator in the event of disagreement between the parties concerned. Those views were rejected by the Minister and it is thought to be no good going over that ground again. As an alternative, it is suggested that there should be an option given to the acquiring authority not to accept the after-damage value as certified by the War Damage Commission and to refer the matter to the official arbitrator. This would be in accord with the recommendation of the Uthwatt Committee which is to be found in paragraph 186, page 76, of their Final Report.

The after-damage value is settled by the War Damage Commission for the purpose of determining the amount of the value payment which is the difference between the value before and after damage. Therefore the greater the after-damage value the smaller is the value payment. It is not suggested that the after-damage value is not fairly assessed, but if it is known that the land is to be acquired by a local authority and if the intended Act is to provide that the after-damage value is to be the basis of compensation by local authorities in cases of purchase, it will be in the interest of the War Damage Commission to give as high an after-damage value without this affecting the total amount to be received by the owner. It is because of these possibilities that I am moving this Amendment. We are not against the proposed new Schedule, and we admit very readily that there are advantages to be gained by it, but I venture to suggest that it will be considerably improved by the insertion of the words which I have put on the Paper.

Amendment to the proposed new Schedule moved— Paragraph 1, at end of sub-paragraph (1), insert the said words.—(Lord Ammon.)

5.8 p.m.


This is a matter of very great importance to local authorities and I regret that it should need to be dealt with at this late hour. We do not desire unnecessarily to delay the proceedings, but I must point out that this new Schedule introduces quite a novel and indeed revolutionary method for determining the price which local authorities shall pay for land. It is to be determined as a result of negotiations to which they will not have been parties. I admit, and so do the local authorities, the substantial administrative advantages likely to be secured by the proposed new Schedule both as regards the avoidance of duplication of valuation which is important and the not less important point of having a global valuation rather than valuation of separate interests. That could make for an enormous saving in time and work.

But there still remains the point that the local authorities are going to be bound, not before ascertaining, but before being allowed to ascertain, by a valuation come to by another party. The business of the War Damage Commission is to minimize the payment for damage. That is quite a proper thing. They are in charge of public funds and it is a proper thing to see that those funds are prudently expended. Therefore it is to the interest of the War Damage Commission to put after-damage value as high as possible because it is by deduction of the after-damage value from the pre-damage value that they arrive at the net amount of the claim. Therefore, in addition the local authorities not being parties to this ascertainment there is one party in whose interest it is that the ascertainment should be as high as possible.

You may say, and it may be correct, that the owner of the premises will object to the War Damage Commission valuing the land too highly. That may be so, or it may not be so. But, of course, if the owner has got an inkling of what is going to happen—and in many districts, as soon as the war with Germany is over, it will not be impossible to get an inkling as to where development is going to take place, and the line of the development to be carried out by local authorities—and once he is satisfied that his property is likely to be acquired, he is unconcerned as to the figure at which the War Damage Commission may put the after-damage value of his property. He knows that he will have it deducted from his claim by the War Damage Commission, but will get it from the local authority as prescribed under the Eighth Schedule. That is really putting the local authority, if I may say so with every respect, in a position, in which they ought not to be put. The Uthwatt Committee, at page 76, were quite definite about this. They said: The new provision should make it clear that, although the information obtained from returns, assessments, etc., in the case of those connected with the War Damage Act, 1941, must be taken into consideration, and in other cases may be taken into consideration, they are not necessarily to he the basis on which the award is made. The Report goes on: They are to be treated as relevant facts, not conclusive tests. The next point I wish to make arises in this way. The proposal as I understand it is this: that the Eighth Schedule will be concerned with the basic valuation, that is the basic valuation made by the War Damage Commission, and then there may be another valuation made—namely, the valuation for the supplement. Who is going to make the valuation for the supplement? The War Damage Commission, at the moment, is not required to make valuation for supplement. It may be required to do so later on. An indication has been given that adjustments and amendments may be made, but, as I understand it, at the moment the War Damage Commission is not required to inquire whether or not the owner of the property is entitled to supplement. But the local authority will have to face that, and we may well have an imposed valuation—the War ,Damage Commission valuation—and the valuation by somebody else, who does not, necessarily, know the mind of the valuer who does the valuation for the War Damage Commission, assessing the value for supplement. That may place the local authority in the position of paying twice in respect of certain elements of the value of the property. In my humble submission, it cannot make for tidiness of valuation if you are going to have two bodies valuing different elements of the same property without necessarily coming into cot tact, and without either of them necessarily having information which the other may have. I could expand this point at considerably greater length, and, possibly with utility, but the hour is late. May I add that local authorities willingly admit that this proposal has great administrative advantages and may have cash advantages by reason of the global valuation rather than the valuation of the individual interests. If I were to say that this is revolutionary I would point out that the use of the word revolutionary is not hyperbolic. But, at any rate, this is perfectly novel.


Some revolutions are quite respectable.


I do not hesitate to—but there, I had better leave that, or I may get into another Schedule. I will only say that this is a very novel and revolutionary proposal that a local authority should have the price it pays determined by a body and by negotiations to which it is not party. Whatever may be the result of this Bill, I think it is obvious to anyone that the burdens local authorities have to bear under this measure, if they really seek to make it achieve some of the objects it is intended to achieve, are pretty considerable and pretty heavy. They should be permitted the option of saying whether they will be bound by a certificate of value which has been given in their absence.

5 17 p.m.


The noble Lord has made, if I may say so with respect, a perfectly reasonable and clear speech. It is true that to ask the local authorities to accept, and agree to act upon, a valuation made by another body, primarily for another purpose, and without the local authorities actually being there to argue it out, is not a thing that would be following in the ancient ways, and those persons who object to any form of revolution might be disturbed. But I think this is a good revolution, for the main reason which the noble Lord has frankly and fairly stated. I am quite convinced that if we do not do something like this there is going to be wholly unnecessary and most undesirable complication in working out a great many of these urban compensation matters.

I must point out, with equal candour and, I hope, equal fairness, that Lord Latham, while he explains the objection very clearly, has not, I think, with equal clearness pointed out what this Amendment really does. It really gives the local authorities a soft option. They may ascertain what, in various cases, is the figure which the War Damage Commission has fixed for the purpose of a value payment, and they may then go through the list and say: "Well that is a nice low one, so we will have that. This one is a high one, so we will not have it," and they, therefore, to use a common expression, would get the best of both worlds. I do not see how you could give an equal option to the other side. Indeed, if you did it would only amount to saying: "You shall only use this information if both sides agree." We must either say that we must have this invaluable set of carefully fixed values, and use them for this purpose, or scrap the idea. It is quite correct to say .that in one sense the War Damage Commission when it is fixing the value payment may be supposed to be interested in not making it bigger than they can help. I do not think, if we look at it in a practical rather than in an unreal and, perhaps, ultra-legalistic way, that the War Damage Commission is, in practice, open to that suspicion. It is engaged, if I may speak quite strictly, not so much in distributing public money as really in distributing the fund which has been made by the contribution of all the people who have been affected.


As to only 50 per cent.


That is a true and just counter. I will withdraw that particular observation. But there are cases, no doubt, where it would be most unreasonable to ask local authorities to accept a figure which they have taken no part in fixing. But it is a question here of all or none and what Lord Ammon's Amendment means is that he is merely going to give in individual cases an option to the local authority to say, "Yes, we will take Mr. Trustram Eve's figure." You cannot do that; you must accept it or not.


If I may say so, I do not think that that completely states what the Amendment of Lord Ammon would secure. It is an option not to say "I will not pay the price" but to say "I do not think that this price is fair; let it go to independent arbitration."


Certainly. I will say, if you like, that it is an option to get a second chance. But there is no option for the claimant. If the local authority under this Amendment says "Yes, let us all agree that that is the proper valuation," because they think that it is low enough, there is no provision for the claimant to say "I think that this is skinning me."


I am sorry to interrupt again, but I am sure that the noble and learned Viscount will forgive me. The claimant has already had an option to appeal under the War Damage Act itself. The local authority has not.


I see. It shows what a complicated thing this is. We both want to work it out properly, but I doubt whether we can do so across the Table like this. My present impression—I have not the authority of the Minister, and I do not know what my noble friend beside me (Lord Woolton) thinks—is that if this is persisted in it is a negation of the principle of the Schedule, and we should regretfully have to withdraw the Schedule if we decided that the view held by the noble Lord was correct. I should be sorry, because it means an administrative saving. As a matter of fact, the Committee is not at present very fully attended, and if we had a Division the result, if I recollect our Standing Orders aright, would merely be that the matter would be referred to the next sitting of the House. We should not decide anything here, whichever way the vote went. I think that that is correct.




I feel that I must take the responsibility of withdrawing the Schedule now, and warning noble Lords that that does not mean that the Government might not try to put it down again at a later stage, while doing anything we can to reach agreement behind the scenes, rather than proceed to a Division which, in view of our small numbers, would itself be ineffective; but I think that on other grounds that would be very unfortunate. I should like Lord Latham to say what he feels would be the best course.


We are all in a little difficulty. There is no question of conflict here; we both wish to secure that what is best shall be done. I will say quite frankly that I should regret the withdrawal of the Schedule. On the other hand, I am more than a little anxious about its alteration in the respects which I have indicated. If my noble friend behind me (Lord Ammon) were willing to withdraw his Amendment, I do not know whether it would be possible for officers of the London County Council to have a talk with officers of the Ministry between now and Tuesday.


I am sure that it would be.


I am bound to say that I am very loth to withdraw my Amendment. On the other hand, as I said when I moved it, I see great advantages in this Schedule, and if, as my noble friend has suggested, some informal conversations can take place, I beg leave to withdraw.

Amendment to the proposed Amendment, by leave, withdrawn.

On Question, Amendment agreed to.