England and Wales Lands Tribunal

Garrod v London Borough of Newham [2004] EWLands ACQ_96_2002 (20 April 2005)

ACQ/96/2002

LANDS TRIBUNAL ACT 1949

COMPENSATION – compulsory purchase – abandoned house in dilapidated condition – untraceable owner – comparable transactions – Housing Act 1985 s.17 and Land Compensation Act 1961 Part 1 – compensation determined at £60,000

IN THE MATTER of a NOTICE OF REFERENCE

BETWEEN F GARROD Claimant

and

LONDON BOROUGH OF NEWHAM Acquiring Authority

Re: 73 Washington Avenue, London, E12

Before: P R Francis FRICS

Sitting at: Procession House, 110 New Bridge Street, London, EC4V 6JL

on

14 April 2005

The claimant did not appear and was not represented

Mrs Anna Eastgate, solicitor to the London Borough of Newham, for the acquiring authority


 


DECISION

1. This a decision to determine the amount of compensation to be paid into court by the London Borough of Newham ("the council") in respect of the compulsory acquisition of the freehold interest in 73 Washington Avenue, London, E12 ("the subject property") under the Newham (73 Washington Avenue, London, E12) Compulsory Purchase Order 2000 ("the CPO"), where the owner is untraceable.
2. At the hearing, Mrs Anna Eastgate, a solicitor with the London Borough of Newham, detailed the steps that had been taken to trace the owner and called Mr David Drane MRICS, a district valuer with the Valuation Office Agency, who gave valuation and background evidence.
3. From the evidence presented at the hearing, I find the following facts:

3.1 The subject property, which has been vacant since it was severely damaged by fire in 1994, comprises a Victorian mid-terrace two storey bay fronted house of brick construction under slated roofs. It is in a long terrace of similar properties on the north side of Washington Avenue, in an established residential area off the main A118 Romford Road and backs on to the main railway line serving London Liverpool Street Station. There were two reception rooms and a kitchen on the ground floor and three bedrooms with bathroom and wc on the first together with small gardens to front and rear.

3.2 Following the fire, when the property was vacated and never re-occupied, its condition deteriorated and it subsequently became derelict. It attracted unauthorised entry and the council received complaints from the neighbours. L B Newham has used its statutory powers to secure the property on a regular basis and has undertaken basic maintenance to prevent roof slates slipping and causing injury to passing pedestrians.

3.3 In the light of a perceived need to provide 8,300 additional dwellings in the district by 2006, the council had adopted an Empty Property Strategy in 1996 aimed at bringing long-term empty properties back into beneficial use. With this in mind, and as it was considered there was no likelihood of the property being returned to beneficial use unless the council intervened, its Housing Committee authorised the making of a CPO on 16 February 1999. In support of its case, the Statement of Reasons for the proposals included the following:

"4.5 If the order is confirmed then the council would wish to see the property made available to a Housing Association/Trust or placed onto the private market, thereby ensuring it is brought back into beneficial use as quickly as possible. Such action will include a complete upgrading of the property both internally and externally, which will contribute to the regeneration of the Borough as a whole and thus fall within the council's vision to make Newham and attractive place for people to live and work.

4.6 It is considered that the disposal of the property will achieve the provision of housing accommodation as the owner, who is at present uncontactable, is uncommitted to the property's use as a housing unit. Without immediate attention being given to the property it may deteriorate further to a point where a substantial amount of refurbishment work or even demolition of the whole structure will have to be considered".

3.4 The CPO was subsequently confirmed by the Secretary of State on 10 May 2000, a General Vesting Declaration was made on 21 February 2001 and the property was formally vested in the council on 16 August 2001, which is the valuation date for the purposes of this reference.

4. Mrs Eastgate confirmed that the council had taken all possible steps to trace the owner, including advertising in the local newspaper and service of documentation by recorded delivery on Mr Garrod's last known address. Enquiries had also been made of his neighbours and of all relevant council departments, including social services and the Council Tax section, the latter advising that there were arrears outstanding.
5. Mr Drane is a chartered surveyor, and a district valuer with the Valuation Office Agency. He has 15 years valuation experience within the VOA 7 of which have included work in the Newham area. He said he had inspected the property when possession was taken on 16 August 2001 in the company of a structural surveyor who had carried out a detailed investigation and produced a comprehensive report dated 28 August. Mr Drane had relied upon this report, and upon evidence of comparable sales in the vicinity. The property, he said, was in appalling condition, made worse by a severe pigeon infestation. Complete refurbishment was required, including making the building wind and weathertight, renewal of all windows and doors, extensive replastering and replacement of ceilings, the renewal of all internal services, provision of new kitchen and bathroom fittings and complete redecoration. This would be the minimum required to make the property habitable and other works could be contemplated including the fitting of central heating.
6. In arriving at his opinion of value, Mr Drane said that he had considered the sales, at around the valuation date, of three similar properties in the street. All were in satisfactory and habitable condition and contained 3 bedrooms and 2 reception rooms. 3 Washington Avenue was sold in July 2001 at £125,000, number 21 was sold in November 2001 at £129,000 with number 15 sold in March 2002 at £122,000. In his professional opinion the subject property would have been worth £125,000 in good condition at August 2001, but the cost of refurbishment (estimated at £50,000) and an allowance for risk/profit (at £15,000) reduced the figure to £60,000. Mr Drane said the house would have been unmortgageable in its then condition, and would only have been of interest to a cash buyer or a builder/speculator – hence the need to allow for a risk and profit element.

Conclusions

7. From the evidence, and from the information provided to the Registrar in preparation for this hearing, I am satisfied that the acquiring authority has taken all reasonable steps, and made sufficient diligent enquiries to trace the owner but without success. The provisions of Schedule 2 to the Compulsory Purchase Act 1965 will, therefore, apply. I am also satisfied that Mr Drane's valuation correctly reflects the open market value of the subject property as at 16 August 2001in its then condition.
8. The amount of compensation payable for the freehold interest in 73 Washington Avenue, London, E12 is thus determined at £60,000. The claimant's costs of legal transfer, if any, are to be paid in addition. All costs in respect of this reference shall be paid by the council in accordance with Schedule 2, para (4) of the 1965 Act.

DATED 20 April 2005

(Signed) P R Francis FRICS