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Highways LawThursday 7th December, 2017

Huw Williams, Charles Felgate & Tomos

Phillips - Geldards LLP


Highways Compulsory

Purchase Orders and

CompensationHuw Williams

Partner, Geldards LLP


• Origins of compulsory purchase for infrastructure

schemes

• CPO Legislation

• The “Life Cycle” of a CPO

Introduction


• S.239 acquisition for construction or improvement

• S.240 acquisition for side roads (s.14) and new

PMA’s (s.124), watercourse diversion (s.110),

public conveniences (s.114) & lorry areas (s.115)

• S.246 mitigation of adverse effects

• S.248 acquisition in advance of requirements

• S.249 distance limits (220 yards for LA’s) –

Sch.18

Main Highways Act CPO

Powers


• S.250 creation of new rights over land

• S.260 Clearance of title to HA land

• S.106 - 107 Construction of bridges, diversions

and works in navigable waters

• S.108 works in non navigable waters

Highways Act CPO - Related

Powers


• Acquisition of Land Act 1981

• Principal Regulations• Compulsory Purchase of Land (Prescribed Forms)

(Ministers) Regulations 2004

• Compulsory Purchase of Land (Written

Representations Procedure)(Ministers) Regulations

2004

• Compulsory Purchase (Inquiries Procedure) Rules

2007

• Highways (Inquiries Procedure) Rules 1994

CPO Legislation – Procedural

Legislation


CPO Legislation – Procedural

Legislation 2

• Compulsory Purchase Act 1965

• Compulsory Purchase (Vesting

Declarations) Act 1981

• Also:

– Human Rights Act 1998

– Equality Act 2010


• Land Compensation Act 1961

• Land Compensation Act 1973

• Tribunals, Courts and Enforcement Act

2007 and the Tribunal Procedure (Upper

Tribunal) (Lands Chamber) Rules 2010

CPO Legislation – “The Land

Compensation Code”


• DCLG – Guidance on compulsory purchase process

and the Crichel Down Rules for the disposal of

surplus land acquired by, or under threat of,

compulsion

• Issued October 2015 in stand-alone format

• Updated 22nd September 2017

Non- statutory CPO guidance


• Circular 1/97 Highways Act 1980: Orders under

section 14 of the highways act 1980 and opposed

Orders Under section 124 of that Act. [“Side Roads

Orders”]

• Circular 2/97 Notes on the Preparation, Drafting and

Submission of Compulsory Purchase Orders for

Highway Schemes and Car Parks for which the

Secretary of State for Transport is the Confirming

Authority.

• Highways Agency Memorandum TR138D [“Land

Reference Plans”]

Non-statutory Guidance -

Highways CPO


• Right to make a representation to the

appropriate Minister who must certify:

• Land held for undertaking

• Land can be taken without serious detriment or

• If taken that alternative land is available to the

undertaking

• Where acquiring authority is not a Minister or a local

authority a statutory undertaker may invoke Special

Parliamentary/Assembly procedure

Statutory Undertakers


• DECC /DoT/DEFRA/HMT

• Initiated by a representation during the CPO

objection period

• Decision maker on serious detriment/replacement

land and whether to issue “section 16 certificate”

Statutory Undertakers –

Role of the “appropriate Minister”


• Phase 1 - Powers and Justification

• Phase 2 - Preparation

• Phase 3 – Examination and Confirmation

• Phase 4 - Implementation

• Phase 5 - Compensation

The “Life Cycle” of a CPO


• Powers

• Planning Background and Permission

Phase 1 – Powers/Justification


• Need to satisfy Ministers that no planning

impediments if CPO confirmed so permission will

always need to be in place before

inquiry/confirmation

• Schemes of any significance will require EIA

• Habitats regulations – need for preliminary appraisal

of need for appropriate assessment

Phase 1 - Planning Position


• Elements of a CPO:

• Order

• Maps

• Concurrent procedures

• Statement of Reasons

Phase 2 – Preparation


• Drafting the Order

• Statutory Forms

• Selection of correct form

• The CPO Map

• Order Map

• Land Referencing Map

• Note changes when temporary occupation

introduced

Phase 2 - The Order and Map


• Investigation of ownership and occupation

• Roles of lawyers and surveyors

• Statutory notices

• Legal interests map

• Plot description must be accurate and enable land

to be identified without the Map

• Local Government (Misc Provisions) Act 1976

• Common power to enter for survey now in force

under Housing and Planning Act 2016

Phase 2 - Land Referencing


• Table 1

• Owners

• Lessees

• Tenants

• Occupiers

• If in doubt include a party and serve

Phase 2 - Scheduling – Table 1


Table 1


• Table 2

• Response to HRA concerns

• Mortgagees/utility companies/benefit of rights of way/restrictive covenants/other persons with potential claims under s.10 CPO Act 1965

Phase 2 - Scheduling – Table 2


Table 2


• Special categories:

• Common land

• Public open space

• Allotments

Phase 2 - Concurrent Procedures

Special Categories of Land - 1


• Confirmation subject to Special Parliamentary

Procedure, unless a “S.19 Certificate” is given that

SoS satisfied that:

• Adequate exchange land will be given

• Acquisition is to improve management, or

• Area is <250 sq yds for highway widening or drainage


Special Categories of Land – Open Space


• Applies to land of National Trust “held inalienably”

• Confirmation subject to Special Parliamentary

Procedure unless objection withdrawn

• NT will usually require a CPO to be made if

inalienable land is affected

Phase 2 Concurrent Procedures

Special Categories of Land – National Trust


• Improvements and alterations to existing roads due

to new “principal road”

• Classification notice of new principal road (s.12(3))

• SRO must precede or made simultaneously with

CPO

• Circular DoT 1/97

• Form of SRO, Schedule and maps

• Separate procedure for notification and

advertisement (Schedule 1 Part 1)

• Rights of statutory undertaker maintained


Side Roads Orders


• Works in Navigable Waters

– ss 106 – 107 Highways Act 1980

– Navigation authority objection and potential for

Special Parliamentary Procedure

• Works in non-navigable waters

– ss 108 Highways Act 1980

– Do not require specific authorisation if included in

CPO


Bridge Orders


• The Crown is immune from compulsory purchase

unless consent has been obtained

• In the absence of express agreement Crown

interests must be excluded

• Special provisions for the crown to agree with an

acquiring authority for inclusion of land in a CPO

Phase 2 -Note on Position of The

Crown


Phase 2 – Note on Minerals

• Special rules apply to acquisition of minerals by

CPO

• Application of the “Mining Code”


• See Circular Guidance

• Sources of information:

• Planning report

• Non technical summary of EIA

• Human rights assessment

• Equalities Act assessment

• Basis for CPO authorisation report

• Include maps

• Delegated powers to make changes

Phase 2 – Drafting the Statement

of Reasons


• Statutory forms of Notice – description of land

• Covering letter

• Reduced size copies of maps

• Statement of reasons

• Information about compensation

• Unknown owners

• Service on Companies

• Site notices

Phase 2 - Service of Notices


• Circular Guidance

• Check number of copies

• CPO and SRO requirements differ

• Documents referred to in Statement of Reasons

• Deposit documents

Phase 2 - Submission of Orders

Public Inquiries for

Highways

Charles Felgate



• Procurement of your team

• Statutory undertakers

• Allotments and Open space

• Managing documents

• Dealing with third parties

• Permitted development rights

• Climate change and carbon impacts

• Air quality

Issues to consider


• Members of your team:

Consultants – one consultant or several experts from different disciplines?

Programme officer

Public liaison officer

Compensation surveyors

Counsel

Procurement of your team


• Early contractor involvement

• Appoint Counsel early to get a steer on issues

• Multi disciplinary or cherry picking of experts

Procurement of your team


• Undertakings for accommodation works

• Avoid third party objections where possible

• Early consultation is key

• Consider modifications to CPO and seek agreement

• Consider requirements in relation to acquisition by agreement

Dealings with third parties


• CPO may not be confirmed for land of statutory undertaker unless Minister certifies:

Land can be purchased and not replaced without serious detriment to undertaking; or

Land can be replaced by land belonging to or available for acquisition by undertakers without serious detriment to undertaking

• S.16 Acquisition of Land Act 1981

Statutory undertakers


• Difficulties sometimes arise in using highways powers to replace land of statutory undertakers

• You may need to rely on powers of statutory undertakers

• Reach agreement with statutory undertakers early

Statutory undertakers


• Extensive documents and long inquiries

• Good library system essential

• Need to decide whether to make documents

available electronically

• Deposit points needed – where public can view

documents

• Logistics are important

Managing documents


• Powys windfarms inquiry – largest in Britain

• 6 sessions on 55 days spread over a year

• Planning lawyers doubled as van drivers

• The best dressed white van man in Britain

Managing documents – Geldards’

experience


• M4 Corridor around Newport Inquiry

• 62 sitting days so far

Managing documents – Geldards’

experience


• Town and Country Planning (General Permitted

Development) (England) Order 2015

• Development schemes can use permitted

development rights but some constraints apply:

Rights subject to considering habitats regulations

Some demolition permitted but not listed buildings

Permitted development rights might not apply if

environmental impact assessment required

Permitted development rights


• Power for a highway authority to acquire land for the

purpose of mitigating adverse effects of constructing

or improving highway

S.246 Highways Act 1980

• Narrow power but objectors sometime suggest

highways authorities should use it widely

• No case law

Mitigation


• Section 246(2A) Highways Act 1980

Power for highways authority to acquire blighted

land by agreement if authority considers

enjoyment of that land will be seriously affected

by works or use of the highway and interest of

vendor is a qualifying interest

Blight


• R v Parliamentary Commissioner for Administration

Ex parte Balchin (No.1) [1998] 1 PLR 1

• R v Parliamentary Commissioner for Administration

Ex parte Balchin (No.2) [2000] 2 LGLR 87

• R v Secretary of State for Transport Ex parte Owen

(No.1) [1995] RVR 117

Blight Mitigation – Case Law


• Consider carbon impacts of highways schemes

Do not get drawn into considering how this will

affect Government targets

• Process

Consider construction impacts, user impacts,

operational impacts

• Consider wider implications

Eg impact of policy to move to no new non-

electric vehicles

Climate change and carbon

impacts


• Consider air quality impact of highways schemes

• Judicial reviews on air quality have clarified strength

of legislature and requirements

• R (on the application of Client Earth) v Secretary of

State for the Environment, Food and Rural Affairs C-

404/13

Air Quality


• Autumn Budget 2017

• Increase in taxes on new diesel cars that do not meet

the latest standards to be used to fund a Clean Air

Fund to support the implementation of local air quality

plans

• “Before the headline writers start limbering up let me

be quite clear: No white van man (or woman) will be

hit by these measures.” – Chancellor Philip

Hammond

Air Quality

Compulsory purchase orders

and compensation continued

Huw Williams



• Decision Letter

• Certificates – s.16/s.19

• Housing and Planning Act 2016 – six week time limit

• Service of Notice of Confirmation

• Statutory form

• Check referencing information for changes e.g. change

of company registered office

• Site notices

• Notices of Concurrent Procedures

• Provision of “As confirmed” copies

Phase 3 - Notice of Confirmation


• ss. 23-26 Acquisition of Land Act 1981

• Grounds:• No power to make CPO

• Procedural defect causing substantial prejudice

• Statutory challenge – no leave stage

• Six week “window” to challenge• From first public advertisement

• Danger of premature challenge

• Quashing can now extend to decision or

applicant only

Phase 3 - Legal Challenge


• Duration of powers

3 years

Extended if there is a challenge by 1 year or time

to disposal if longer

• Notice to Treat and Notice of Entry

Return of claim form

Model form as from 22nd September 2017

• Notice period for entry is now three months

Counter notice procedure if entry not taken

• Severed interests

Phase 4 - Implementation


• Transfers title on vesting

• Some disadvantages if used for highway schemes

• Reforms of GVD process from 3rd February 2017

• Preliminary notice abolished

• Amendments to form of CPO

• Vesting and right of possession 3 months after

notices served of GVD

Phase 4 – GVD Procedure


– Section 5 Land Compensation Act 1961

• Rule 1 - No allowance for acquisition being

compulsory

• Rule 2 - Market value for land

• Rule 3 - No account of special suitability

• Rule 4 - Unlawful uses disregarded

• Rule 5 - Equivalent reinstatement

• Disturbance payable in addition to Rule 2 (Market value)

Phase 5 – Compensation Main

Principles


• From 22nd September 2017 new statutory “no

scheme” rule in ss2 & 6A LCA 1961:

– any increase in the value of land caused by the

scheme forwhich the authority acquires the land is

to be disregarded, and

– any decrease in the value of land caused by that

scheme or the prospect of that scheme is to be

disregarded.

– 5 “no-scheme rules”

Phase 5 – Compensation “No-

scheme” rule


• New rules brought in under the Localism Act from

6th April 2012

• Based on principle of scheme cancellation

Phase 5 - Compensation Planning

Assumptions


• Severed land

• Additional Payments

Statutory loss payments

Injurious affection to retained land

Phase 5 – Compensation other

payments


• Advance Payments

– Request for advance payment

– 90% of authority’s estimate

– Overpayments and further payment

– Pending reforms to increase uptake

Note judgement interest on late payment –

8%

• Limitation

– 6 years from entry

– may be waived or extended

Phase 5 Compensation - Advance

payments and Limitation


• Injurious affection – no land taken

S. 10 Compulsory Purchase Act 1965

“McCarthy Rules”

Damages/loss of capital value basis

• Claims for physical effects of use

Part 1 LCA 1973

• Blight Notices – “reverse CPO”

Note restrictions on right to claim to certain interests

and value limits

Phase 5 – Compensation Special

cases


Drafting and Negotiating

Section 38 and Section 278

AgreementsTomos Phillips

Senior Associate, Geldards LLP


• Section 38 most commonly used for construction of

new roads to be adopted

• Section 278 for works on existing highway

• Often will involve use of both powers

• Similar procedure

Introduction


• Adoption of new roads as highway maintainable as

public expense

• No obligation under Advance Payments Code

(s.219(4)(d), HA 1980)

agreement can provide for any sums paid under

Advance Payments Code to be repaid (s.221(3))

HA should consider serving notices within 6

weeks

• Need dedication and adoption

Introduction to S.38 Agreements


• Only owner of land with capacity to bind land in

perpetuity has capacity to dedicate

• Consider the following:

Freehold owners – yes

Lessee – no

Adverse possession – yes, but await registration

• Mortgagee consent

• Need for caution if ownership unknown

• Connection to a point to which public have right of

access (Kotegoankar v SoS [2012])

Capacity to Dedicate


• Wide discretion for HA (s.38(6))

• Construction costs

• Supervision and inspection fees

• Costs in event of developer default

• Grant of any easements

• Commuted sum (R (Redrow Homes Ltd) v

Knowlsley MBC [2014])

• Legal costs

Terms that may be Included


• Indemnity for losses and liabilities from breach of

developer’s obligations

• Indemnity for compensation claims:

s.10, Compulsory Purchase Act 1965

Land Compensation Act 1973 (Wiltshire CC v

Crest Estates Ltd [2005])

Noise Insulation Regulations 1975

Indemnity


• Security to ensure road brought up to adoptable

standard in event of default

• Bond with surety

• Cash deposit

• HA step in rights and licence to enter onto land

Security & Step in Rights


• Not an overriding interest under LRA 2002 so not

binding on successors in title

• Register as a land charge

• S.33 Local Government (Miscellaneous Provisions)

Act 1982?

• S.87 New Roads and Street Works Act 1991

• Restriction on assignment

Assignment & Transfer of Benefit


• Consider how highway to be drained

• Drains may be vested in HA (s.264, HA 1980)

• May need agreement under s.104 Water Industry

Act 1991

specify timescale for entering into agreement

• Caution against relying on developer to maintain

Drainage


• Developer to carry out/pay for diversionary works

• Such works to be agreed before commencement of

highway works

• Code of Practice under s.84 New Roads and Street

Works Act 1991

Statutory Undertakers


• Detailed description of works

• If split into phases specify timescale for each phase

of works

• Specification of materials

• Materials to be tested to ensure accord with

specification

• Right of entry for testing

Specification of Works


• Public liability insurance

reflect size and complexity of works

• Certificate of insurance cover to be provided before

commencement of works

• Construction (Design and Management) Regulations

2015

ensure developer/contractor specified as the

client

Insurance & Liability


• Inspection upon practical completion

• Inform developer of any defects to be rectified

• Issue certificate once satisfied

• Restriction on occupation of development

• Maintenance period – typically 12 months

road becomes highway open for public use but

not maintainable at public expense

Inspections, Maintenance

Periods and Certificates


• Developer to maintain works during maintenance

period

• Further inspection at end of maintenance period

• Specify conditions to be satisfied prior to issue of

final certificate

• Upon issue of final certificate highway becomes

maintainable at public expense

Inspections, Maintenance

Periods and Certificates


• General position – surface of road vests in HA,

subsoil remains with private owner

• Potential implications if highway later stopped up

and if statutory undertaker apparatus

• Developer obliged to transfer if requested by HA

• Developer to assist in any LR application

Transfer of Land


• Ensure intention of parties clearly defined

• Address any discrepancies between plans and

highway actually constructed

Betterment Properties (Weymouth) Ltd v James

Carthy & Co Ltd [2010]

Clarity on land to be adopted


• Works within adopted highway

• Developer to pay whole or part of costs

• Essentially a “funding mechanism” (O’Connor v

Wiltshire CC [2007])

• Works not constructed on behalf of developer

Introduction to s.278 Agreements


• Must fall within HA’s powers

• May be entered into even if HA need to exercise

CPO powers to execute the works (s.278(4), HA

1980)

Authorised Works


• Usually follows grant of planning permission

likely to be sufficient benefit if mitigates effects of

development

• If PP granted on appeal, HA may be acting

unreasonably if refuses to enter into agreement

R v Warwickshire CC ex p Powergen plc (1998)

• May be scope to refuse if material change in

circumstances or highway concerns not properly

taken into account

Benefit to the Public


• Developer to pay whole or such part of costs

specified in agreement

• S.278(2) – includes costs incurred in the:

making of the agreement;

making/confirmation of any scheme or order;

granting of any authorisation, permission or consent;

acquisition by the HA of any land required; and

administrative expenses

• Commuted sum for future maintenance

Cost of the Works


• Restriction on use of access/facility

• If not complied with, HA may execute works to stop

up access or deny the facility

• HA can recover outstanding sums from person

having an estate or interest in land that benefits from

the access or facility

• Any sum outstanding can be registered as a local

land charge

Enforcement of Payment


• Indemnity for losses and liabilities from breach of

developer’s obligations or compensation claims

• Security to ensure works completed to required

standard in event of default

• Step in rights

Indemnity & Security


• HA appoints developer to act as its agent

• Delegation to contractor provided developer remains

liable

• Approval of construction contract

• NCE4 standard conditions of contract

Delegation of Obligations


• Works not to commence until pre-commencement

certificate issued by HA

• This should not be issued until:

detailed design, specification and programme of

works approved by HA

various costs paid to HA

any TRO’s have been made

all other matters have been carried out e.g.

agreeing diversionary works with statutory

undertakers

Pre-commencement

Requirements


• TRO may be needed to restrict or prohibit movement

of traffic (s.14(1) RTRA 1984)

• Make clear HA not obliged to make TRO

• Any objections need to be considered

• HA may be required to try and resolve any

objections as soon as possible

Traffic Regulation Orders


• Works to be inspected upon completion

• If HA satisfied, certificate of practical completion

issued

• Maintenance period – typically 12 months

• During maintenance period highway should be made

available for use by the public

• At the end of the maintenance period, HA inspect

again and issue final certificate

• Works become part of highway maintainable

at the public expense

Inspections, Maintenance Periods

and Certificates


• Reg 123 – LPAs can’t require s.278 agreement for

infrastructure on ‘Reg 123 infrastructure list’

• Exception where s.278 agreement would be entered

into by relevant Minister (e.g. trunk roads), TfL or

strategic highways company

CIL Regulations 2010


• HA may receive requests for information under FOIA

2000 or EIR 2004

• Statutory duty to release information unless

exemption applies

• HA should resist any confidentiality provisions

Freedom of Information


Any Questions?

Huw WilliamsPartnerT: 029 2039 1765

E: [email protected]

Tomos PhillipsPartnerT: 029 2039 1787


Charles FelgatePartnerT: 029 2039 1858



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