§ 7.30 p.m.
§ The Parliamentary Under-Secretary of State, Department for Environment, Food and Rural Affairs (Lord Whitty)
rose to move, That the draft regulations laid before the House on 14th May be approved [30th Report from the Joint committee].
The noble Lord said: My Lords, these regulations derive from powers contained in Section 68 of the Countryside and Rights of Way Act 2000, which came into force on 1st April 2001.
The regulations provide a solution to problems which were discussed at some length in your Lordships' House and in another place during the passage of that Act, but originated in a particular example in relation to a common in north-west Hampshire. There the owner of the common had pointed out to the residents that vehicular access to their premises was across his land, and that it was a criminal offence for them to drive across it without lawful authority. Because it was a criminal offence, no rights of access had been acquired through long use, but he would be prepared to grant a legal right of access in return for compensation.
The residents were most concerned about this, given that the accesses had been in existence for many years and there had not been any suggestion before that they did not have a legal right to use them. Without a right of vehicular access, sale of their properties would be blighted. Furthermore, the amount of compensation being demanded was in their view excessive. We rapidly realised that this problem was not, in any sense, confined to north-west Hampshire. Similar problems arose in other parts of the country with different landlords and with different configurations of the ownership and access patterns. Frankly, it is impossible to estimate the full extent of the problem, but it is clear from cases which have been drawn to our attention that it is more widespread than at first thought.
The Government looked at the issues thoroughly and, as was requested in both Houses, brought forward amendments to the then Countryside and Rights of Way Bill, which became Section 68 of the Act. Section 68 of the Act provides for the creation of a statutory easement in circumstances where a vehicular access crosses land over which it is an offence to drive, and where the use of the access has been for such a time, and in such a manner that, had it not been an offence to drive across the land, a right of access would have been acquired through prescription. The intention is that the statutory easement should convey on owners of the premises essentially the same rights as they would have acquired through prescription, in circumstances where the landowner is either unwilling to grant an easement, or is seeking excessive compensation for doing so.
The section provides the power to make regulations setting out the nature of the statutory easement, the procedures to be followed when an application is 75 made, how disputes should be resolved, and—crucially—the compensation sum payable to landowners in return for the easement coming into force over their land.
During the passage of the Bill and since a number of Members of this House have taken a keen interest in these provisions and looked forward to the regulations being provided under it, in drawing up the procedures we have taken into account the many points put to us by noble Lords and others during a number of consultation exercises undertaken since October 2000.
The regulations therefore prescribe the process to be followed. That involves the owner of the premises submitting to the landowner an application which contains the information and other details set out in a schedule to the regulations. It is important that the application should contain comprehensive information as that will form the basis of the registration of the easement with the Land Registry at the end of the process.
The process then provides for the landowner either to accept the application or object to it by serving a counter-notice. The procedures envisage one further exchange between the two parties—by the serving of an amended application or amended counter-notice, before one of them decides to invoke the dispute resolution procedures. Where the dispute is over the value of the premises, disputes can be settled by a chartered surveyor either agreed by the parties or appointed by the president of the Royal Institution of Chartered Surveyors. All other disputes—for example, about whether the qualifying criteria are met, or the terms and limitations attached to the easement—would be resolved by the Lands Tribunal.
Once agreement on all matters has been reached by the parties, the owner of the premises has to pay the compensation sum to the landowner, who must issue a receipt. If the landowner refuses to accept the compensation, it can be paid into court. The regulations provide that the easement comes into existence on payment of the compensation sum.
Noble Lords are probably particularly interested in the compensation sum prescribed by the regulations. Our objective has been to strike a fair balance between the interests of the landowner and the owner of premises desiring access where access has been established. It has therefore always been our intention that landowners should receive some compensation in return for rights coming into existence by statute over their land. That was not of course the position that was taken by all the speakers in your Lordships' House or another place. But we believe that that balance is needed and we believe that approach to be compatible with the provisions of the European Convention on Human Rights.
We listened carefully to the views expressed on the compensation sums in this House, in another place, and by the organisations and individuals who have commented on this issue since October 2000. The conclusion we have reached is that the compensation payable in respect of older premises, already in 76 existence at the point when it became an offence to drive on common land, should be a relatively small amount. We therefore propose that the compensation sum should be 0.25 per cent of the value of premises in existence on 31st December 1905 and 0.5 per cent for premises coming into existence after this date, but which were in existence on or before 30th November 1930. For all other premises the figure proposed is 2 per cent. Those are significant reductions in the sums that owners of premises might expect to pay without these regulations, when compensation of up to 10 per cent of the value of the premises have been sought by landowners in some circumstances.
We believe this strikes an appropriate balance. I look forward to your Lordships' contributions in commenting on the regulations. I beg to move.
Moved, That the draft regulations laid before the House on 14th May be approved [30th Report from the Joint Committee].—(Lord Whitty.)
§ Lord Trefgarne
My Lords, the House is grateful to the noble Lord, Lord Whitty, for bringing these regulations before your Lordships.
I start by declaring a former interest. I was at one time a trustee of the Horsell Common Preservation Society. One of the cases to which the noble Lord referred was a case brought by a Mr Hanning on behalf of that society. I am no longer a trustee, but am very much in support of its position on the matter.
The regulations, as the noble Lord has said, provide for the implementation of the principles set out in Section 68 of the Countryside and Rights of Way Act 2000. When that piece of legislation was passing through this House, the noble Lord, Lord McIntosh, who was then in charge of the Bill stated:This problem which the Government seek to resolve concerns cases where a property owner has been driving to his home across common land unhindered and continuously for many years".—[Official Report, 16/11/00; col. 421.]The Minister correctly identified part of the problem but only part of it. There is a separate problem, which I shall now briefly describe.
The problem especially affected the Horsell Common Preservation Society. Premises adjacent to Horsell Common were not a home. For many years, they were quasi-industrial premises and were being used covertly for light industrial purposes. The local planning authority made several attempts to enforce the fact that the business being conducted on those premises was unauthorised. Those attempts failed. The premises continued to be used for unauthorised purposes for a considerable period. Eventually, an easement was sought to the effect that the company had used the road through Horsell Common for so many years that it was entitled to it as of right. Horsell Common Preservation Society went to court, won its case and that was the end of the matter at the time.
However, the mischief—if I may describe it in such terms—remained. The Government, recognising the problem, as did the society, laid these proposals. Unfortunately, despite representations from a number 77 of sources, the regulations do not differentiate between domestic and industrial or commercial property. The arrangements that the Government propose for compensation for the owners of domestic property are about right. I have no strong views on that. But they are clearly not right for commercial property.
The plain fact is that had the owners of the property to which I referred, the covert commercial users, gained unhindered access through Horsell Common to their premises, they would have enhanced the value of their property by not 2 per cent but by 200 to 300 per cent. It is wrong that the only compensation they would have been required to pay is the modest figure provided for in the regulations.
The difficulty for the Horsell Common Preservation Society was not only the financial considerations, unjust though they were, but the fact that the use of the road through its common was highly environmentally disadvantageous. I watched the vehicles thundering through myself. From time to time, they placed users of the common in danger. They severely damaged the road and forced the common preservation society to undertake great expenditure to keep the road in reasonable condition.
The arrangements in the regulations to allow easements for commercial property users are inadequate and unsatisfactory. I hope that the Minister will reconsider them. I made those representations to the Minister in a letter to which I have not yet had a reply. It was sent comparatively recently, so I do not complain about that. I hope that he will accept that there is a problem, the nature of which I have described, and will be prepared to consider how to find a solution to it. I look forward to hearing what he has to say.
§ 7.45 p.m.
§ Baroness Sharp of Guildford
My Lords, we on these Benches also thank the Minister for laying the regulations. As the Minister said, they were the subject of extensive consultation and, like the noble Lord, Lord Trefgarne, I agree that the balance now achieved is probably about right.
However, I should like to raise three issues with the Minister to which he may be able to reply. The first is that of common land of which there is no known owner. To date, there is no commitment to sorting out that question, although it has been discussed. The result is that anyone owning property fronting onto such land at present finds it impossible to sell other than to cash buyers because mortgage lenders seek the certainty of an easement, which cannot be granted as there is no one to grant it. They may accept insurance indemnity cover. One possible solution may be for the valuation of the easement to be made by a chartered surveyor and for all the money to be, in effect, put on one side into a trust for a time. But there is concern about what happens where there is no known owner: who shall make the grant?
The second problem is the question of access over village greens, which is a different issue and something of a legal minefield. I have certainly not understood all 78 of the issues involved. But what concerns us most is that, for similar reasons to those obtaining where there is no known owner, there is a danger that people so affected would not be able to sell their house. That is extremely difficult for them. They are locked in until they can sell their house. Has the Minister any proposals for such cases? Is there a deadline by which the Department for the Environment, Food and Rural Affairs make proposals for village greens?
The final issue concerns compensation. Regulation 11(1)(2) states:Subject to paragraph (2), the compensation sum shall be 2 per cent".Is that the maximum, or will it be levied at 2 per cent? For example, Hertfordshire County Council charges nothing, while Guildford Borough Council at present judges anything between £500 and £1,500, depending on council tax band, which is usually much less than 2 per cent. Will they be allowed to continue to charge less than 2 per cent, or is 2 per cent the requisite sum?
The consultation document published in July 2001 states that where authorities,wish to grant an easement for less than the price set out in the regulations, it will be open to them to consider whether. in accordance with the relevant provisions of Part VII of the Local Government Act 1972, they wish the seek the Secretary of State's consent for a disposal at less than the best consideration reasonably obtainable. In such a case, specific consent would only be required if the undervalue exceeded that permitted by paragraph 6 of the Local Government Act 1972 General Disposal Consent 1998".Does that still apply? Is that what is proposed?
With those three reservations—on which I hope that the Minister will enlighten us—we welcome the regulations.
§ The Earl of Onslow
My Lords, I do not think that the Horsell Common Preservation Society has ever received such a high profile. I declare an interest. I am president of the society. It does not mean that [have to do anything, but it was set up by my grandfather for the benefit of the public around Woking.
Such problems have arisen with many commons in areas of considerable habitation—many houses. The proportions of 2 per cent and 0.25 per cent are completely reasonable. I know that the Government absolutely hate my telling them how well they have done; they get embarrassed and crawl—well, I have been told that that is the case.
I emphasise the question asked by the noble Baroness, Lady Sharp: is 2 per cent the maximum? Do people have to charge the maximum or do they have discretion, as would be reasonable? Above all, I support what was said by my noble friend Lord Trefgarne about industrial access.
It is all fine and large an old-fashioned and long-established right being tidied up, which is the case for domestic, private houses The Government seem to have got that about right, if in a slightly complicated and obtuse way. Having said that, it is another matter to allow a commercial company to have an enormous increase in its assets at what could be either public or private cost. As we have heard, Guildford Borough 79 Council and Hertfordshire County Council own a lot of common land. Why should they give an extra subsidy to commercial concerns to increase their value by a sleight of hand?
I know that we cannot amend secondary legislation. We must say either "yea" or "nay", which is a clumsy thing. However, I shall trust to the wisdom, common sense and ability to listen of the Minister. He should pay attention to what the noble Baroness, Lady Sharp of Guildford, my noble friend Lord Trefgarne and I have said. I hope that he will think that we have been sensible and reasonable: I think that we have. Our point needs substantial consideration.
§ Lord Faulkner of Worcester
My Lords, I am also happy to support the Motion, but I shall ask my noble friend the Minister one question. I apologise if I appear naïve in asking it. I read the supporting documents, and I am looking for an assertion that the compensation that will be paid is a once-and-for-all payment that will go with the property to which it applies and will not be re-applied to subsequent owners when they sell. I am sure that that is the case, but I should be grateful for such an assurance.
I shall indulge in a small personal anecdote. Last year, I sold a house on a common adjacent to the Malvern Hills. The common was owned by the Malvern Hills Conservators, and there was a frontage of about six metres between my garage and the road. When I came to sell, I discovered that, because of the legislation, a payment was required. When I bought the house, my surveyor, my lawyer and everyone else who advised me were unaware that compensation would have to be paid. Certainly, they did not alert me to that possibility. It never occurred to me that I was doing anything illegal by taking my car out of my garage and putting it on the road. It was necessary to reach an agreement, in great haste, with the conservators on a payment, so that I could go ahead with the sale of the property.
It strikes me that I am not alone in facing that difficulty. There are hundreds of houses around the Malvern Hills that abut onto common land, and the owners have not the faintest idea that they are acting illegally by driving in and out of their driveway across the common land. I hope that one of the effects of passing the regulations will be that DEFRA and its regional offices will undertake a publicity campaign to make people aware that they will have to deal with compensation. It may be that the landowners—in this case, the conservators—will not go out of their way to get it, but people will have a nasty shock when they come to sell their house.
§ Baroness Byford
My Lords, I also thank the Minister for bringing the regulations before us. Our discussions today will be slightly briefer than the discussions we had about the relevant part of the Countryside and Rights of Way Bill, on which we spent many hours. As noble Lords have suggested, that Bill had huge repercussions for some people, 80 repercussions of which they were totally ignorant. People were not aware that they were not obeying the law within the law.
I have one or two questions for the Minister. On these Benches, we thank the Minister for the fact that the Government listened to that debate. As the Minister will know, we raised the issue in Committee, on Report and at Third Reading. The Minister agreed that, in some cases, the charges were too high and that, in some cases, they were too low. One of the problems was that the costs needed to be at a certain level to cover the cost of administering the registration of the easements. We thank the Government for listening.
The Government originally proposed a figure of 4 per cent. The level is now 2 per cent. Other noble Lords asked whether it was 2 per cent maximum or up to 2 per cent. I looked through the Countryside and Rights of Way Act 2000, and, as far as I could see, that is not defined as such. It is, I think, just 2 per cent, not up to 2 per cent. I seek a little clarification because, unless people actually seek easements, they do not have to get one. It is only in cases in which a party wants to instigate the process that there must be a response from either the owner of the land or the parish council. That is the scenario that has come up today. Can the Minister confirm that I am right in my understanding, which is that if people do not seek an easement, they need not go through the process? If they do, the relevant figure represents a maximum and not an "up to" figure. Having considered the matter, I understand that there is a certain leeway for councils and individuals in deciding whether to enact the full amount. I presume that the 2 per cent figure is a maximum, and I should be grateful for clarification.
I am grateful to noble Lords and to those in another place who spoke during the passage of the Countryside and Rights of Way Bill. Subsequently, however, I have had correspondence from Sally-Jane Raes of Chorleywood, who was concerned about the higher level of compensation. She felt that the legislation should read "up to 2 per cent". We cannot alter the regulations, but the Minister should clarify that.
I do not know whether Sally-Jane Raes has written to the Minister. In her letter to me, she mentioned several other things. One was the situation of those—perhaps themselves elderly—who live in older properties. Many such people are what I describe as property-rich but cash-poor. Have the Government considered making an easement on their behalf? Another point that she raised was that the market value of a house should be set at 1993 levels, not 2002 levels; that would make a huge difference. The interpretation of the law changed in 1993 in the Court of Appeal judgment. What is the Government's view of that? The final point that she raised was that car parking, as such, was not covered by the Act. I think that I am right in saying that we did not debate that issue. Have the Government considered whether there should, under the terms of easement, be specific allocations for parking, in cases in which a lack of space on the driveway means that cars are parked on the common, not the driveway?
81 In another place, my honourable friend Mr Sayeed highlighted the fact that the Law of Property Act 1925 was never intended to stop people driving over the common to their home—not, I note, their business. It was intended to stop members of the public driving on a common while others were on the common for air and exercise. It is true that, between 1925 and 1993, no one was prevented from driving to his or her house across the common. However, the court has now denied that presumption of free access.
My honourable friend also asked how the regulations would deal with a case in which a house was sold but the former owner did not take up a request to buy the rights of access—perhaps he did not drive or did not want the rights. What position is the new owner in? That issue was raised in the other place. Will the Minister enlarge on it today?
My honourable friend Sir Paul Beresford also raised concerns in another place. He raised the issue of whether common land might be held by more than one person. If the common land were in private ownership, it might have been subdivided, and rights of access could go across more than one owner's land. What would be the position in such a case?
My noble friend Lord Trefgarne asked about the position of businesses. Again, I looked back through our deliberations, and I found that it had slipped through the net. We did not address that issue. I asked whether the legislation applied just to a house or to the fields or farm behind it. That has implications too. In Committee and at other stages of the Bill's passage, we decided that it referred only to the property. My noble friend has raised an important issue. We dealt only with domestic property, not business property. No doubt, the Minister will clarify that.
I have also had a long correspondence with Sir Sydney Chapman with regard to a letter that he received from William Pumfrey. I hope that the Minister has a copy of that letter; I understood that he was writ ten to about the matter. As it is a long and full letter, I do not want to go through it in detail. The Minister indicates that he does not have a copy so it may be helpful to the House if I cover a couple of the points raised.
Mr Pumfrey raises an interesting point. Considering the law as it previously stood, he does not see why the property should be dealt with differently and considers that Section 68 should apply to all. He makes a lengthy legal argument. Perhaps it will be more helpful if I pass the letter to the Minister after the debate. I want to indicate the fact that he has raised queries about the regulations.
As noble Lords have said, the difficulty we faced in Committee and in taking the CROW Bill through the House related to the fact that the easement and arrangements fell between parish councils and individual owners. It was the responsibility of parish councils to try to get the best possible value for all their parishioners and therefore some parishes decided to charge a high rate. We welcome the fact that the Government have imposed a maximum of 2 per cent. 82 They are sensible arrangements but raise issues not only for individuals and their properties but also for parish councils in the longer term.
Finally, Regulation 15 relates to the creation of the easement and begins:Upon payment of the compensation sum either".I wonder whether it should read,upon receipt of the payment",because a payment can be made but not received. I do not know whether it is normal legal practice within drafting orders. The Minister can perhaps clarify the matter. I support the points raised by my noble friend Lord Trefgarne.
§ 8 p.m.
§ The Earl of Onslow
My Lords, I am sorry to intervene again, but my noble friend Lady Byford has put into my mind a new and important query. It relates to the access to agricultural land over common land. Let us assume that access to a farm is over common land and that we reasonably say that 2 per cent goes to the farmhouse. As the farm is a business, if the Minister accepts the force of the argument put forward by my noble friend Lord Trefgarne and supported by myself, how do we separate out the difference of access over the land to a private house and access over the same land to a farm or a business? I hope that the Minister will forgive me for intervening a second time. It is an important point arising from what my noble friend Lady Byford said.
§ Lord Whitty
My Lords, some interesting and complex points have been raised. Perhaps I may first deal with the issue of commercial versus domestic properties. The recollection of the noble Baroness, Lady Byford, and other noble Lords is correct; we were talking largely in terms of households or houses. Nevertheless, the argument that there has been an established practice of access morally and legally must equally apply to legal commercial activity. The example raised by the noble Lord, Lord Trefgarne, was of covert extension of the premises into a business activity for which planning permission had not been obtained. However, where there is established use, logically it does not matter what the premises were previously used for. Therefore, commercial use—I shall turn to agricultural use in a moment—establishes the same dilemma as regards the compensation to be given to the landowner and the rights to be given to the property.
In the commercial case, the valuation of the premises would reflect their commercial value. If there is a change of use, the situation changes. If one is moving from a residential to a commercial activity, the previous arrangement falls and the valuation is then based on commercial use. If the commercial activity is non-legal—if there is no permission for it—the landowner has a case that the valuation should reflect the commercial activity. The noble Lord. Lord Trefgarne, raised an important point but in most circumstances—except in a change of use or an 83 unlawful use—the valuation of the property would yield a higher return to the landowner if it were commercially used.
As regards the agricultural dimension, it would be unusual if the only access were at the same point as the access to the farmhouse. In any case, a valuation would relate to the total area for which access was being sought. That could be a house, a commercial property or land. The application must clearly describe the premises which are served by the access and they would be valued accordingly. If there were other access to the farmland, one would expect the application not to include it because that would raise the price. In rare circumstances where the only access was to the farmhouse and the land, the logic of the situation would be that the compensation would be based on the valuation of the totality of the premises to be covered by that access. However, that situation would be rare and special provisions may need to apply. It is probably unlikely to arise.
I repeat that if there is increased commercial activity, or if there is changed commercial activity or a change of use of any kind, the provision for the valuation based on previous commercial use or domestic use is no longer valid. In that situation, and only in that situation, will a new owner, for example, have to face up to a second sum of compensation. In normal circumstances where a valuation has been made and the compensation paid, a new owner would not be faced with further compensation. The easement would stand, as it would in common law, for the future unless there were a change of use.
The noble Baroness, Lady Sharp, asked whether 2 per cent was the maximum or the set fee; in other words, whether one could negotiate up to the maximum. Under the regulations, 2 per cent is the prescribed amount. We are talking about a situation which must be dealt with by regulation and 2 per cent is the figure. Of course, that does not preclude landowners and those who require access reaching a settlement of less than 2 per cent outside the regulations. That would apply to local authorities as much as it would apply to private landowners. Therefore, people can reach a lower figure, but not via Section 68 of the Act or via these regulations.
The noble Baroness, Lady Sharp, asked about the situation in which ownership of the common land is not known. That is difficult conceptually because the situation could not arise if the owner were not known; if the person requesting access raised the issue, no one would apply for the compensation or would require it.
§ The Earl of Onslow
My Lords, I speak from personal experience. With regard to small plots of common land, it can be incredibly difficult to discover who is the lord of the manor and to whom moneys should be paid. As a consequence, if the land covers an area on which a mortgage is to be raised, then the mortgagor will ask, "Have you got an easement?". I must respond by saying, "No, because I do not know whom I should pay". "Right, you cannot have a mortgage". This is an important point.
84 I do not know how it is to be dealt with, but such circumstances can arise. I have been involved in exactly that kind of case at home.
§ Lord Whitty
My Lords, I see the problem. I suppose that there is an obligation on those seeking access to try to find out who is the owner, but if that is not possible and no owner comes forward to claim compensation, then it is conceivable that such compensation might be required at a later stage. However, at the time of any change of ownership, the situation would remain as it stands at that point; namely, that no easement would be required and no easement would be granted. Given that, it would be difficult for a mortgagor to make a stipulation.
Provided that the normal searches had been carried out and that efforts were made to trace the owner and to check whether that owner was likely to require compensation, then the position is clear.
The issue with regard to common land forms part of a significantly wider matter. During the course of our debates on the Bill I recall that my noble friend Lord Williams of Elvel, who is not in his place this evening, raised the issue at some length and has returned to it subsequently. It needs to be addressed as part of a much wider problem. There are unregistered areas of common land, in particular on town and village greens, where the provisions might otherwise make it a criminal offence to assert access. Furthermore, there are certain obscurities with regard to the legal position in those situations. Regrettably it is not always possible to offer a clear legal view since many cases go back into the mists of time.
However, the Government have indicated that they are considering the matter as part of an administrative review of legislation generally on common land. We hope shortly to announce an initiative in the area. However, I regret that I cannot give a full answer tonight.
§ Baroness Sharp of Guildford
My Lords, I shall be brief. There is a continuing problem with regard to non-ownership and village greens because of the issue of mortgages. I think that the Minister should bear it in mind.
§ 8.15 p.m.
§ Lord Whitty
My Lords, I accept the point made by the noble Baroness. That is why the matter will form part of our consideration on a wider review of common land. Not only in this area are there potential legal problems with regard to the unclear situation of the legal owners. Regrettably it applies in a number of areas around the country, and will probably apply in areas about which we do not yet know. As I have said, the problem will be addressed as part of a consideration of the wider context.
The noble Baroness, Lady Byford, asked a series of questions. She queried why property values were to be set at current levels; namely, at the point at which someone files an application rather than freezing values at any given point, such as in 1993. It is 85 reasonable that at the point at which compensation is paid, that compensation should reflect market values at the time. That is why we have stipulated the current value rather than fixing it at the point at which the law was clarified.
The noble Baroness asked about payment by instalments. Nothing in the regulations would prevent an agreement from being made which allowed the payments to be made in instalments, if that was agreeable. However, the 2 per cent is the prescribed rate.
The noble Baroness also asked about car parking. The matter was not touched on when we debated the primary legislation. It might be covered by the easement, but it would have to be proposed as a part of the application at the time. I think it would also have to be an established practice and position about which no one would argue. For that reason, I think that the number of circumstances under which this procedure would cover car parking arrangements would be relatively limited.
The noble Baroness also referred to a letter which I regret I have not seen personally, although I appreciate that it is with the department. As a result of that letter, the noble Baroness asked why there is a differential between the various ages of property. The answer is that the law changed in 1925 and 1930. Indeed, one could argue that before 1925 no criminal offence would have been involved and that any payment would not be logical. My noble friend Lord Williams of Elvel—I hope that he will not mind my referring to his words in his absence—has made the point quite forcefully. On balance, we reached the conclusion that there was a residual possibility of a human rights issue for the landowner and therefore we have prescribed the minimal 0.25 per cent rate. However, the reason for the differentiation is that the law changed during that period, in particular in 1930.
§ Baroness Byford
My Lords, I thank the Minister for allowing me to intervene. The whole thrust of Mr Pumfrey's letter turns on the fact that, because the law changed, it has implications. Previously they may have been acting legally, but that was no longer the case once the law changed. That is the ground on which Mr Pumfrey's argument is based.
I appreciate that the matter is technical and legalistic. However, if the Minister is happy to receive a copy of the letter, then I shall ensure that it is sent.
§ Lord Whitty
My Lords, I am grateful to the noble Baroness. I shall certainly respond.
She also raised a question of whether this should be regarded as a receipt rather than a payment. It states in Regulation 13 that, on payment:The land owner shall …provide the applicant with a written receipt".That then provides evidence of payment. The two are inter-related. I think that the noble Baroness will find that it is normal to refer to "payment" rather than to "receipt" in regulations of this kind.
86 My noble friend Lord Faulkner raised the issue of publicity. As the regulations come into effect we shall consider the need for publicity both for those seeking access and for the landowners involved.
I believe that I have now dealt with most of the questions that were put to me.
§ Lord Trefgarne
My Lords, before the noble Lord sits down, could he clarify the position with regard to what happens when a house owner has secured an easement, perhaps through the provision of these regulations, and then secures a dramatic change of use for those premises from simple residential purposes to light industrial use? The value of that property will then be hugely enhanced. Presumably, however, the owner would not have to pay anything more. Would that be the case?
§ Lord Whitty
My Lords, on any change of use the landowner would have the right to return to indicate that the valuation of the property in its legal change of use should be reflected in the easement. Therefore the difference should be paid by the new owner or the owner who had acquired planning permission for wider purposes. Indeed, even if the property had already been valued for commercial purposes, but those purposes were then significantly extended, the reflection would also apply.
§ The Earl of Onslow
My Lords, I am sorry to interrupt yet again but I have picked up a point from what the noble Lord said. If a man who has a large garden and a farm at the back through which people pass suddenly gets permission for change of use for housing or an industrial estate, the value of his land goes through the roof. Normally if you have a ransom strip you immediately go on holiday and open a Swiss bank account because it becomes very valuable indeed—I believe that the courts have found it to be up to a third of the value of the property.
If someone gets an enormous increase in value, it seems rather unfair on the local authority—let us say Guildford Borough Council—or the Malvern Hills Conservatives or even a private owner of common land that they should not get some of that enormously enhanced value. The 2 per cent on existing rights for houses seems absolutely reasonable and no one will argue about that, but to limit it to 2 per cent of the increased value of a whacking great commercial gain strikes me as a little unfair. It is of no benefit to the Government and it could be construed as a disadvantage to local authorities—some of which own large chunks of common land and look after it for the benefit of the community—that they should not be able to benefit from it. Perhaps the Minister will look at the issue again, think about it, and then come back to us.
§ Lord Whitty
My Lords, procedurally I cannot come back to the House. Clearly the noble Earl has raised an issue. Although of course we are talking about a situation where access has been established in the previous use and not about ransom strips in the 87 normal sense, if there is a huge increase in the value of the land as a result of planning permission change and industrial development, 2 per cent of the increase seems a reasonable return. However, there may be situations where that is not apposite. We shall have to see how matters work out. I am certainly happy to learn from instances such as the one referred to by the noble Earl.
On Question, Motion agreed to.
§ Baroness Farrington of Ribbleton
My Lords, I beg to move that the House do now adjourn during pleasure until 8.30 p.m.
Moved accordingly, and, on Question, Motion agreed to.
§ [The Sitting was suspended from 8.21 to 8.30 p.m.]