Fairness and common sense need to be the cornerstone of CPO process
Richard Collins looks at the dos and don'ts for landowners faced with compulsory purchase orders
The government has earmarked €7.3billion in spending on regional roads projects under its Project Ireland 2040 plan.This will entail a wave of Compulsory Purchase Orders (CPOs) on farmland.
In this series of articles, I will look at what CPOs involve for farmers, and how they can best negotiate what can often be a complex and stressful process.
The overriding principle governing all compensation is the principle of equivalence. A property owner is entitled, insofar as money can do so, to be restored fully to his or her overall position that existed before the CPO.
But a landowner subjected to the CPO should be aware that common sense must prevail. Complying with the rules, regulations and case law, handed down over generations, is the key to satisfactory outcomes.
An experienced agronomist/valuer will be in the best position to do negotiations, and advise on the levels of compensation and accommodation works.
Overall compensation for the value of the land acquired plus devaluation of the land retained is capped at the maximum value of the entire holding. This test is exclusive of compensation for disturbance and costs. This cap will seldom be reached as it is difficult to envisage a situation where the retained property, after the scheme, would be worth absolutely nothing.
Compensating property owners should be a simple exercise but in practice it is not always so. Acquiring authority agronomists/valuers will often strongly resist implementing the statutory rules, regulations and case law. Against that, property owners can have an exaggerated view of their legitimate entitlements.
When these two forces collide, there can only be one outcome - High Court or arbitration. This should be a last resort but not shunned if it becomes necessary.
Property owners are legitimately entitled to compensation in terms of financial payments and accommodation works for:
- The value of the land acquired.
- Permanent disturbance, to reflect the full and potential value to its owner of the land acquired and retained.
- Damage due to severance of the land acquired from the balance of the property retained.
- Damage due to injurious affection of the property retained.
- Temporary disturbance during the construction phase of the works.
- The costs of the CPO process incurred by the property owner.
Selecting experts to manage CPO process
Service of a CPO on a property owner is likely to be a once-off, and indeed a traumatic event. Serious thought needs to be put into how the entire process should be managed. Some dos and don'ts include:
Select a project manager: If the property owner has the relevant knowledge and experience, (s)he will be the best overall project manager. Otherwise, an agronomist/valuer should take on this function.
Select an experienced and qualified team of experts. The team will need to include, at least, an agronomist/valuer, and solicitor with relevant experience.
Beware of persons offering services who promise everything even though such promises cannot be delivered under the terms of the standard entitlements. Such persons are either inexperienced or dishonest and could be found wanting, particularly in complex cases, when it is too late.
Remember, the reasonable costs of professional services are payable by the acquiring authority and getting the best available advice should not cost anything extra.
Except in minor impact cases, it should always be assumed that your case could end up in assessment or arbitration. While everybody will prefer to reach agreements, the fact is that a significant number of the larger cases, on all schemes, will end up in assessment or arbitration.
Selecting Other Professional Advisers
CPO schemes vary significantly. For example, a scheme which includes development land may need the services of a professional planner.
In recent years, health and safety regulations have become important. Acquiring authorities can sometimes be careless in this regard. Strict compliance with health and safety regulations should be insisted on by the property owner. The services of an experienced health and safety engineer will be necessary in many cases.
The design of a road scheme is governed by detailed standards set out by the National Roads Authority. Examples of departures from their own standards by road designers and construction contractors are not uncommon. This means the services of an experienced roads engineer may be advisable.
Other professional service providers such as vets, quantity surveyors, sound engineers etc. may also be required.
In my next article, I will deal with the issue of land values and how the compensation for the land taken from the owner should be valued. In subsequent articles, I will deal (from the owner's point of view) in more detail with all the more important aspects of the CPO process.
Avoiding the pitfalls of 'sweet deals'
Once the scheme is legally put in place, the negotiations on compensation and accommodation works begin. Property owners and the acquiring authority will each appoint their own negotiator, which is normally an agronomist/valuer. There is a responsibility on these negotiators to be credible and realistic.
The acquiring authority negotiator should not be biased but should adhere to the overriding principle that the property owner is entitled to fair compensation for all losses.
No attempt should be made to get a ‘sweet deal’ to please the acquiring authority.
Professional agronomists/valuers should interpret and apply the rules, regulations, and case law in a consistent manner regardless of whether acting on behalf of the property owner or the acquiring authority. Negotiations should sort out minor differences between the respective parties.
The stated policy of the Roads Authority is to get value for money. In itself, this is not in accordance with regulations and case law, which states that compensation should be based on the value of the loss to the owner — not its market value.
Assessment or arbitration is the final step in the compensation determination process if voluntary agreement cannot be reached.
At that stage, the negotiators will be required to give their own independent and professional evidence that will assist the assessor/arbitrator in making a fair and reasonable determination.
My experience has been that county councils acquiring land for road schemes and wayleaves for public infrastructure do not have an interest in being mean with property owners. However, the same cannot always be said for some of their agronomist/valuers.
Richard Collins is a consultant with FBA Consultants, based in Fermoy, Co Cork. He is the co-author with Noel O'Brien of A Practical Guide to Compulsory Purchase in Ireland. firstname.lastname@example.org or 025 31244
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