What is a Compulsory Purchase Order?
14 February 2017
A Compulsory Purchase Order is when the government, Councils or utility companies in certain circumstances have a Statutory Right to buy your property or take a right over it. In order to exercise such rights the body must meet set criteria as laid down by statute, in particular the authority must prove the purchase is in the public interest.
Statutory bodies who apply for Orders are usually government departments, water or electricity companies. An Applicant does not have power to acquire the land until the appropriate steps have been taken to confirm the Compulsory Purchase Order. The Applicants are also encouraged to agree with the landowner to acquire the land rather than attempting to acquire by compulsion. Only when an agreement cannot be reached will the body be in a position to move forward with a Compulsory Purchase Order.
If you believe a Compulsory Purchase Order process has commenced on your land you should keep a detailed diary of events, together with a list of expenses incurred as a direct result of the process. You can contact the Local Authority who may be able to provide further information relating to a proposed Compulsory Purchase Order.
Before the Compulsory Purchase Order process can commence the Applicant will usually undertake a feasibility study of the area in question and determine what extent of the land is required. They may decide as part of the study to view not only the boundaries but also the gradient of the land, and take into consideration the surrounding area. For example, a water company may require a steep gradient and their feasibility study may involve contouring and images from the air to determine the most suitable area.
If your land is being considered you should be contacted as part of the feasibility study as the Applicant may also wish to 'walk the land' to determine if the area is suitable. They may also wish to undertake a survey and enter into negotiations with you.
Once the Applicant has conducted their initial investigations and they consider the land is suitable, they will seek consent to a Compulsory Purchase Order – but only if an agreement has not been reached with the landowner. A report will be prepared by the Applicant, considered and discussed by the appropriate body.
The next stage will be for the landowners to be contacted and a notice served requesting further information, including ownership of the land and if any other person has an interest. Failure to provide information or providing reckless information is a criminal offence. If you believe you have been served with a notice, seek legal advice immediately.
Once all the data has been gathered the acquiring authority will be in a position to make a Compulsory Purchase Order. The application will contain a plan of the area of land, the owner's details, together with any details of third parties who may have an interest. The application will also note individuals who may be entitled to make a claim for compensation. As part of the application a Statement of Reasons for the Order will be included setting out why the Order should be made.
A press release announcing the proposed Compulsory Purchase Order must be published in a local newspaper for a minimum of two weeks and also placed nearby/on the area in question. A separate notice must also be served on every person potentially affected by the Compulsory Purchase Order. The notices will specify a time for objections to be made and how they are to be made. If objections are made a hearing will usually be arranged, however on occasion this could be dealt with through written representations.
After the closing date for objections it will be decided if an inquiry is necessary. This depends upon whether there have been any objections, and who these objections have come from. If an inquiry is required, it will be held within 22 weeks of the Minister hearing the matter and notifying parties. Subject to the outcome of the inquiry the appointed Minister will decide whether to accept, reject or modify the Compulsory Purchase Order and provide reasons for the decision.
It is worth noting that anyone who has had land acquired under a Compulsory Purchase Order is usually entitled to compensation. Compensation is based on the principle that you should not be any worse off in financial terms after the acquisition than you were before.
When determining compensation values there are various components to consider. You should seek legal advice before you agree to any compensation levels to ensure you are fully aware of your rights and legal position. You can find out more about Compulsory Purchase Orders and compensation on the Government website.
However, please note this does not replace the requirement to seek independent legal advice
The law relating to Compulsory Purchase Orders is very complex. If you believe your property is to be compulsorily purchased you should seek legal advice as soon as possible. The Royal Institution of Chartered Surveyors operates a Compulsory Purchase Helpline which may be able to provide you with advice.