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Clause 39—(Compensation For Sever Ance, Injurious Affection And Disturbance)

Volume 530: debated on Tuesday 13 July 1954

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Amendment made: In page 43, line 43, after "assessed." insert:

"in respect of an interest in land."—[Mr. H. Macmillan.]

I beg to move, in page 44, line 4, to leave out from "with," to the end of line 5, and to insert:

"subsections (2) to (7) of this section."
This is the first of another series of rather complicated Amendments carrying out further the process of what I might call the slaughter of the Schedules, so I hope it will be popular from that point of view, at any rate.

The purpose of this Amendment and the one which follows it in line 11 is to dispense with the Eighth Schedule and to insert the substance of it in the present

Clause in a somewhat simpler form. Certain of the provisions will be inserted in a subsequent Clause. The arrangements for the necessary adjustments in the unexpended balance, the machinery for which is contained at the moment in paragraphs 8 and 9 of the Schedule, will be found in Clause 40 in due course.

It is, of course, essential to carry out the same type of calculation as was previously required, this Schedule being the one which deals with the machinery for compensation for severance or injurious act or event on compulsory acquisition of the land. The depreciation which is caused by the injurious act or event has to be dealt with in two branches—the damage to the prospects of development, which we call "loss of development value," and the damage to the existing use of the land, which is called for purposes of convenience the "loss of immediate value."

8.30 p.m.

The compensation, therefore, is to be the amount of the loss of immediate value plus the amount of the loss of development value—if the land affected has an unexpended balance—within the limits of the balance. That is provided by subsections (3) and (4) of the Amendment and that, with the definitions, replaces paragraphs 1 to 5 of the Schedule. The changes in Clause 19 make it unnecessary to provide anything to replace paragraph 6, which can now come out. The proviso to subsection (4) and subsection (5) of the Amendment deal with cases where two or more interests exist in the whole of the land or part of it. They are very similar to the provisions which we have already discussed in Clause 21.

The proposed subsection (6) serves as a pointer to the forthcoming Amendment in Clause 40, which contains the substance of what is now paragraph 9 of the Schedule. If hon. Members will look at the Amendment they will see that it carries out one of the objects which were so much insisted upon by hon. Members during the Committee stage. They will see the way in which the definitions are set out, and the provisions which follow them can, I think, be read very simply and clearly. I hope that the House will agree that the Amendment makes a substantial improvement in that respect.

As the Attorney-General has said, we now see the end of the Eighth Schedule, and we are very glad of it. I should like to say that my colleagues and I appreciate the drafting of the Amendment, and especially the wording of the subsections (6) and (7). From time to time Parliamentary draftsmen come in for a great deal of criticism, some of which is justified and some unjustified, but this, at least, is a piece of work of which they can well be proud.

Amendment agreed to.

Further Amendment made: In page 44, line 11, at end, insert:

(2) In the subsequent provisions of this section, the following expressions have the following meanings respectively—
"the compensation" means compensation such as is mentioned in paragraph (a) of the preceding subsection;
"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;
"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 the preceding subsection 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.

(3) If neither the land affected taken as a whole nor any part thereof is qualified land, the amount of the compensation shall be the loss of immediate value.

(4) 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 the amount mentioned in paragraph (ii) of this subsection, 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.
  • (5) If the land affected, taken as a whole, does not satisfy the conditions mentioned in the last preceding subsection 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 subsection if each such part had been the whole of the land affected.
  • (6) If in any case the amount of the compensation attributable to the loss of immediate value is less than the depreciation in restricted value of the interest affected, subsection (3) of the next following section shall have effect with respect to the amount of the difference.

    In this subsection the expression "the depreciation in restricted value" means the amount, if any, by which the value of the interest affected, immediately after the injurious act or event, would be less than the value of that interest immediately before that 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.

    (7) In calculating value for any of the purposes of this section in its 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.—[ The Attorney-General.]