Scottish Court of Session Decisions
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Cite as: 2016 GWD 4-100, 2016 SLT 409, [2016] CSIH 5, 2016 SC 347, [2016] ScotCS CSIH_5
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EXTRA DIVISION, INNER HOUSE, COURT OF SESSION
[2016] CSIH 5
XA28/15
Lord Brodie
Lady Clark of Calton
Lord Malcolm
OPINION OF LORD BRODIE
in the appeal to the Court of Session
under section 29 of the Land Compensation (Scotland) Act 1963
by
SCARBOROUGH MUIR GROUP LIMITED
Appellant;
against
a decision of the Scottish Ministers dated 23 February 2015 and communicated to the appellant on 23 February 2015
Respondents:
Appellant: Armstrong QC; Shepherd + Wedderburn
Respondents: Findlay; Scottish Government Legal Directorate
21 January 2016
Introduction
[1] The Forth Crossing Act 2011 (“the 2011 Act”) is an Act of the Scottish Parliament. It came into force on 18 March 2011. It authorises the Scottish Ministers to construct a new bridge over the Firth of Forth and to construct and improve associated roads and structures (the “Forth Crossing Works”). Acting through their executive agency, Transport Scotland, the Scottish Ministers have embarked on the Forth Crossing Works and, as at the date of the hearing of this appeal, their completion is anticipated by late 2016 or perhaps early in 2017.
[2] The 2011 Act confers certain powers on the Scottish Ministers in order that they may carry out the Forth Crossing Works. These powers include powers to acquire land and rights in and in respect of land. A power to acquire any land compulsorily is conferred by section 22 of the 2011 Act. A power, when carrying out the Forth Crossing Works, to enter and take temporary possession of specified land is conferred by section 37 of the 2011 Act. Provision is made in part 6 of the 2011 Act for the compensation of the owners and occupiers of land which is made subject to the exercise of the Scottish Ministers’ powers. Particular provision is made for the compensation of a person who has been disturbed in the enjoyment of their land by the taking of entry and temporary possession in terms of section 37, by section 54 of the 2011 Act.
The circumstances giving rise to the appeal to this court
[3] The appellant is Scarborough Muir Group Limited (“SMG”). It owned land known as the Rosyth Gateway site (“the CAAD Land”) extending to 4.2 hectares and lying immediately to the north of the Firth of Forth. The CAAD Land was required by the Scottish Ministers for the Forth Crossing Works. By virtue of their powers under section 22 of the 2011 Act, the Scottish Ministers permanently acquired part of the CAAD Land (“the permanently acquired land”) and temporarily entered and possessed another part of the CAAD Land (“the temporarily acquired land”). Accordingly, in terms of the 2011 Act, SMG became entitled to compensation for loss and disturbance caused by the Scottish Ministers’ possession of the temporarily acquired land. SMG has submitted a claim to the Scottish Ministers but the quantification of the claim is disputed by the Scottish Ministers.
[4] Section 54(2) of the 2011 Act provides that any dispute about the amount of compensation payable for any loss arising from the entry into and temporary possession of land is to be determined by the Lands Tribunal for Scotland. Section 54(3) provides that where temporary possession is taken under section 37 of the 2011 Act, such a dispute is “to be determined in accordance with the [Land Compensation (Scotland) Act 1963 (‘the 1963 Act’)] as if it were a question of disputed compensation for the compulsory acquisition of land”. Sections 22 to 24 of the 1963 Act make provision as to the assumptions to be made as to the planning permission applicable to land for the purpose of assessing compensation in respect of compulsory acquisition. These sections are contained in part III of the 1963 Act. Sections 25 to 30 of the 1963 Act make provision for an application to the relevant planning authority for a certificate stating its opinion as to what planning permission would be appropriate for the land in question (a certificate of appropriate alternative development (“a CAAD”)). These sections comprise part IV of the 1963 Act.
[5] Relying on its interpretation of the relevant statutory provisions and with a view to assisting in the quantification of its loss caused by the Scottish Ministers’ acquisition and possession of the CAAD Land, SMG applied to Fife Council, as relevant planning authority, for a CAAD. On 31 October 2013 Fife Council issued a CAAD in respect of the CAAD Land. The Scottish Ministers, acting through Transport Scotland, appealed against the issue of the CAAD to the Scottish Ministers under section 26 of the 1963 Act. On any such appeal the Scottish Ministers have power either to confirm the CAAD, or vary it, or cancel it and issue a different certificate in its place, as they may consider appropriate. The Scottish Ministers appointed a reporter, Mr Donald Harris (“the Reporter”) to report. The Reporter considered submissions made to him and carried out a site visit. Thereafter the Reporter prepared the Report. In chapters 2 and 3 of the Report there is a summary of the arguments advanced on behalf of the Scottish Ministers and SMG in relation to the competency of the CAAD application. The Reporter set out his conclusions at paragraphs 31 to 33 of the Report (chapter 4). The Reporter identified that he could not make a determination on the legal arguments as to the applicability of part IV of the 1963 Act to the assessment of compensation for entry and temporary possession of land and therefore the competency of the application, but he stated that he had not found the argument advanced by Transport Scotland in support of the proposition that the CAAD procedure provided for by part IV of the 1963 Act did not apply to the assessment of compensation for temporary possession to be persuasive. At paragraph 8.1 of the Report, the Reporter recommended that the Scottish Ministers vary the CAAD for the reasons set out in chapter 7 of the Report.
[6] The Scottish Ministers determined the appeal to them by upholding the appeal in part and cancelling the CAAD dated 31 October 2013. Their decision was given by decision letter dated 23 February 2015. The reasons for their decision are contained in paragraphs 7 and 8 of the decision letter which are in the following terms:
“7. Scottish Ministers have carefully considered the evidence presented by the reporter, the reporter’s findings, reasoning, conclusions and recommendations thereon. However, they do not adopt, for the purposes of their own decision, the reporter’s reasoning and conclusion in Chapter 4 of his report, that is on the validity of the CAAD. Consequently they do not accept the recommendations in Chapter 8 of the report to vary the CAAD.
8. In accordance with Section 26(2) of the Land Compensation (Scotland) Act 1963 (‘the 1963 Act’), Scottish Ministers hereby uphold the appeal in part, in so far as it relates to the validity of the CAAD, and cancel the CAAD dated 31 October 2013. This letter constitutes their decision to that effect. The exercise of powers under section 37 of the Forth Crossing Act 2011 (‘the 2011 Act’) are not of themselves sufficient to meet the circumstances set out in section 30(2) of the 1963 Act and so to allow an application for a CAAD to be made under section 25 of the 1963 Act. The exercise of a power to enter and take temporary possession of land under section 37 of the 2011 Act does not amount, within the meaning of section 30(2) of the 1963 Act, and therefore for the purposes of section 25, to a proposal to acquire an interest in land by an authority possessing compulsory purchase powers. These provisions of the 1963 Act are not modified by section 54 of the 2011 Act.”
[7] SMG appeals to this court against the decision contained in the decision letter of 23 February 2015 in terms of section 29 of the 1963 Act. It invites the court to answer the questions of law for the opinion of the court in the affirmative and quash the decision.
The grounds of appeal
[8] The appellant advances three grounds of appeal against the decision by Scottish Ministers of 23 February 2015. The grounds may be stated shortly as follows:
1. The Scottish Ministers erred in law in reaching the conclusion set out in paragraph 8 of the decision letter in that they failed properly to apply section 54 of the 2011 Act with the result that they failed to apply the provisions of the 1963 Act and in particular part IV of the 1963 Act.
2. In the absence of any basis for doing so being set out in the Decision Letter, the Scottish Ministers erred in law and acted unreasonably in not granting a CAAD in relation to the permanently acquired land.
3. The Scottish Ministers failed to set out proper and adequate reasons (i) as to why the exercise of power under section 37 of the 2011 Act is not of itself sufficient to meet the circumstances set out in section 30(2) of the 1963 Act, (ii) as to why sections 25 and 30 of the 1963 Act are not modified by section 54 of the 2011 Act, (iii) as to why they would not adopt chapter 4 of the Reporter’s Report, and (iv) as to why they would not grant a CAAD in relation to the permanently acquired part of the CAAD Land. Accordingly they erred in law and acted unreasonably.
The appellant presents the following corresponding questions for the opinion of the court:
1. Did the Scottish Ministers err in law in cancelling the CAAD and not granting a CAAD on the basis set out in paragraph 8 of the decision letter?
2. Did the Scottish Ministers err in law and act unreasonably in not granting the CAAD in relation to the permanently acquired part of the CAAD Land?
3. Did the Scottish Ministers fail to give proper and adequate reasons for their decision?
Principal statutory provisions
[9] The 1963 Act provides, inter alia:
“25 Certification of appropriate alternative development.
(1) Where an interest in land is proposed to be acquired by an authority possessing compulsory purchase powers, either of the parties directly concerned may, … apply to the planning authority for a certificate under this section
…
(3) An application for a certificate under this section—
(a) shall state whether or not there are, in the applicant’s opinion, any classes of development which, either immediately or at a future time, would be appropriate for the land in question if it were not proposed to be acquired by any authority possessing compulsory purchase powers and, if so, shall specify the classes of development and the times at which they would be so appropriate;
(b) shall state the applicant’s grounds for holding that opinion; and
(c) shall be accompanied by a statement specifying the date on which a copy of the application has been or will be served on the other party directly concerned.
(4) Where an application is made to the planning authority for a certificate under this section in respect of an interest in land, the planning authority shall, not earlier than twenty-one days after the date specified in the statement mentioned in subsection (3)(c) of this section, issue to the applicant a certificate stating that, in the opinion of the planning authority in respect of the land in question, either—
(a) planning permission would have been granted for development of one or more classes specified in the certificate (whether specified in the application or not) and for any development for which the land is to be acquired, but would not have been granted for any other development; or
(b) planning permission would have been granted for any development for which the land is to be acquired, but would not have been granted for any other development,
and for the purposes of this subsection development is development for which the land is to be acquired if the land is to be acquired for purposes which involve the carrying out of proposals of the acquiring authority for that development.
(5) Where, in the opinion of the planning authority, planning permission would have been granted as mentioned in subsection (4)(a) of this section, but would only have been granted subject to conditions, or at a future time, or both subject to conditions and at a future time, the certificate shall specify those conditions, or that future time, or both, as the case may be, in addition to the other matters required to be contained in the certificate.
…
(9A) In assessing the compensation payable to any person in respect of any compulsory acquisition, there shall be taken into account any expenses reasonably incurred by him in connection with the issue of a certificate under this section (including expenses incurred in connection with an appeal under section 26 of this Act where any of the issues on the appeal are determined in his favour)
26 Appeals against certificates under s. 25.
(1) Where the local planning authority have issued a certificate under section 25 of this Act in respect of an interest in land,—
(a) the person for the time being entitled to that interest, or
(b) any authority possessing compulsory purchase powers by whom that interest is proposed to be acquired,
may appeal to the Secretary of State against that certificate.
(2) On any appeal under this section against a certificate the Secretary of State shall consider the matters to which the certificate relates as if the application for a certificate under section 25 of this Act had been made to him in the first instance, and shall either confirm the certificate, or vary it, or cancel it and issue a different certificate in its place, as he may consider appropriate.
(3) Before determining any such appeal the Secretary of State shall, if any such person or authority as is mentioned in subsection (1)(a) or subsection (1)(b) of this section so desires, afford to each such person or authority and to the local planning authority an opportunity of appearing before and being heard by a person appointed by the Secretary of State for the purpose.
...
30 Interpretation of Part IV.
(1) In this Part of this Act “the parties directly concerned”, in relation to an interest in land, means the person entitled to the interest and the authority by whom it is proposed to be acquired.
(2) For the purposes of sections 25 and 26 of this Act, an interest in land shall be taken to be an interest proposed to be acquired by an authority possessing compulsory purchase powers in the following (but no other) circumstances, that is to say—
(a) where, for the purposes of a compulsory acquisition by that authority of land consisting of or including land in which that interest subsists, a notice required to be published or served in connection with that acquisition, either by an Act or by any Standing Order of either House of Parliament relating to petitions for private bills, has been published or served in accordance with that Act or Order; or
(b) where a notice requiring the purchase of that interest has been served under any enactment, and in accordance with that enactment that authority are to be deemed to have served a notice to treat in respect of that interest; or
(c) where an offer in writing has been made by or on behalf of that authority to negotiate for the purchase of that interest.”
The 2011 Act provides, inter alia:
“54 Compensation: entering and using land temporarily.
(1) A person with an interest in land is entitled to compensation from Ministers for any loss, or any disturbance in that person’s enjoyment of such land ...”
(2) Any dispute about –
(a) a person’s entitlement to compensation, or
(b) the amount of the compensation,
is to be determined by the Lands Tribunal
(3) Such a dispute is, where temporary possession of land is taken under Section 37, to be determined in accordance with the 1963 Act as if it were a question of disputed compensation for the compulsory acquisition of land (and Sections 8, 9, 11 and 12 of the 1963 Act accordingly have effect in relation to such a dispute so far as applicable and subject to the necessary modifications).
(4) In assessing such compensation, account must be taken of—
(a) the fact that entry is taken for a temporary period only, and
(b) whether any action taken under section 41 will have a permanent or temporary effect.
(5) Any compensation payable under this section does not affect liability to pay compensation for loss arising from the Forth Crossing works under—
(a) section 6 of the Railways Clauses Consolidation (Scotland) Act 1845 (as incorporated by section 21), or
(b) any other enactment,
but compensation is not payable for the same matter under this section and that other enactment.”
Submissions of parties
The appellant
[10] Mr Armstrong QC, who appeared on behalf of the appellant, noted that it was accepted on behalf of the Scottish Ministers that the appeal must be allowed in so far as it related to the permanently acquired land and that therefore the decision must be quashed and the matter remitted to the Scottish Ministers with a view to them confirming the CAAD at least in so far as the permanently acquired land was concerned. Moreover, he accepted that grounds 1 and 3 overlapped. Accordingly, essentially there remained only one issue between the parties and that was whether or not the effect of section 54 of the 2011 Act was to apply the CAAD procedure provided for by part IV of the 1963 Act, subject only to necessary modifications, to the determination of a dispute as to a person’s entitlement to compensation for any loss or disturbance in that person’s enjoyment of land. It was Mr Armstrong’s submission that it did. When he came to address us, Mr Findlay, who appeared for the Scottish Ministers, submitted that it did not.
[11] Having set out the structure of what he proposed to say Mr Armstrong began his submissions by referring to two background matters. The first was the period of time over which the appellant was likely to be “temporarily” deprived of its property. The CAAD Land had been required for a works compound for the whole of the project. Entry had been taken on 18 April 2011. While it was hoped that the new bridge would be opened in late 2016 there might be slippage in progress with a consequential completion date in 2017. In terms of section 37(2) of the 2011 Act the Scottish Ministers might remain in temporary possession of land entered into in terms of section 37(1) for up to one year after completion of the Forth Crossing Works. The second background matter was the Reporter’s conclusion on the competence of a CAAD application being made in connection with the land temporarily acquired in terms of section 37 of the 2011 Act. At paragraph 4.2 of the Report the Reporter notes the concern of Transport Scotland that the issue of a CAAD in positive terms in respect of land which was only temporarily taken from the landowner’s possession would enable the landowner to benefit from an uplift in development value twice: first through a CAAD based claim under section 54 of the 2011 Act and second from a subsequent CAAD based planning permission once the land had been returned to the landowner’s possession. At paragraph 4.3 the Reporter states that he does not find this concern to be persuasive in that when the Lands Tribunal for Scotland considers a dispute about compensation under section 54, account must be taken of the fact that the land is entered for a temporary period only. That would clearly minimise any uplift in development value arising from the CAAD being taken into account. Nevertheless in calculating any uplift it is clearly necessary to consider the value of the land. The CAAD allowed this to be done. It was accordingly the Reporter’s view that the CAAD application was competent.
[12] Mr Armstrong then turned to the central issue of the proper interpretation of the 2011 Act. Section 37(2) conferred power on the Scottish Ministers to enter and remain in temporary possession of land. Section 54(1) gave an entitlement to any person with an interest in land to compensation for any loss, or any disturbance in that person’s enjoyment of such land as a result of, inter alia, exercise of the section 37(2) power. Section 54(2) provided that any dispute about a person’s entitlement to compensation for such disturbance was to be determined by the Lands Tribunal for Scotland. Section 54(3) provided that such a dispute arising from temporary possession of land having been taken under section 37 should “be determined in accordance with the 1963 Act as if it were a question of disputed compensation for the compulsory acquisition of land”. It would be argued on behalf of the Scottish Ministers that the words immediately following those quoted and which are in parenthesis: “(and Sections 8, 9, 11 and 12 of the 1963 Act accordingly have effect in relation to such a dispute so far as applicable and subject to the necessary modifications)”, make clear that notwithstanding what precedes the parenthesis, it is only the sections of the 1963 Act which are specified within the parenthesis which apply to the determination of a claim arising from temporary possession of land. That, submitted Mr Armstrong, would be to misconstrue the sub-section. Where the drafter of the 2011 Act wished to incorporate some, but not all, of the provisions of another statute, thereby disapplying particular sections, he had done so clearly and explicitly: section 21(1) (“The Lands Clause Act are incorporated with this Act, except sections …”), section 21(2) (“Section 6, and sections 71 to 78 …of the Railways Clauses Consolidation (Scotland) Act 1845 are incorporated with this Act”), section 47(b) (“section 14 of the 1963 Act does not apply”). If it were the intention of the legislation to disapply all the sections of the 1963 Act other than those specified in the parenthesis, section 54(3) would have done so in terms. In contrast, section 54(3) contained no words of exclusion. On no view, submitted Mr Armstrong, can section 54(3) be construed as limiting the application of the 1963 Act to the sections in parenthesis. Section 12 of the 1963 Act, which is one of these sections, sets out the “Rules for assessing compensation” and provides that “the following provisions of this part of this Act shall have effect with respect to the assessment”. Sections 22 and 23 of the 1963 Act fall within part III of the Act and deal with planning assumptions. They make specific reference to Section 25. Thus, section 54 of the 2011 Act modifies the 1963 Act to apply it to disputes where temporary possession of land is taken under section 37 of the 2011 Act; it is not restrictive as to which sections of the 1963 Act it modifies. Far from serving to exclude the application of the 1963 Act other than the specified sections, the words in parenthesis should be taken to have no legislative effect whatsoever, being included merely to assist the reader: Craies on Legislation (10th edition) para 8.2.14.
[13] Mr Armstrong commended applying what he described as a holistic framework to the interpretation of the relevant provisions of the 2011 Act. There are obvious reasons to apply that framework in its entirety. There are no obvious reasons as to why a legal framework should be created around the four sections contained in the parenthesis in subsection 54(3). Those sections were not designed to be a self-contained grouping but instead were to form part of the scheme created by the whole of the 1963 Act. The intention in enacting section 54 was to treat the process of assessing compensation for the exercise of a statutory power to take temporary possession of land as equivalent to the process of assessing compensation for the exercise of a statutory power permanently to acquire ownership of land: cf BPP (Farringdon Road) Ltd v Crossrail Ltd [2015] UKUT 0356 (LC) at paras 63 to 66. That involves including the facility of applying for a CAAD. The procedure of application to the relevant planning authority for the issue of a CAAD in terms of section 25 of the 1963 Act is a mechanism designed to assist the Lands Tribunal in assessing, in accordance with the rules laid down in section 12, the amount of compensation payable to the owner of land by the authority which proposes to acquire it by compulsory means: Grampian Regional Council v Secretary of State for Scotland 1984 SC (HL) 1 at 9 and 13, on the view that the planning authority is the body best placed to evaluate the likelihood of a future grant of permission in respect of a particular use or uses having regard to the relevant policies and material considerations. Where the landowner seeks compensation on the basis of the planning potential of the land acquired there is something approaching an onus on him to substantiate that aspect of his claim by using the CAAD procedure: Williamson and Stevens v Cambridgeshire County Council [1977] 34 P&CR 117 at 122; the Lands Tribunal should not be asked to decide matters which were capable of decision by certificate: JD White Ltd v Secretary of State for the Environment and Stockton-on-Tees Borough Council [1982] JPL 506 at 507.
[14] It was accordingly Mr Armstrong’s submission that the Scottish Ministers had erred in law in cancelling the CAAD both in relation to the permanently acquired land and the temporarily acquired land. While it had been conceded on behalf of the Scottish Ministers that they had made an error in failing to have regard to the inclusion of the permanently acquired land in the CAAD Land and that their decision must therefore be quashed, Mr Armstrong asked that, given that this was an issue between the parties which required to be resolved, the court make clear in its opinion that the error extended to the temporarily acquired land.
The Scottish Ministers
[15] Mr Findlay, on behalf of the Scottish Ministers (and not, he explained, Transport Scotland), confirmed that ground of appeal (2) was not opposed. What was left was a short issue of statutory construction primarily concerning section 54(3) of the 2011 Act. Neither the length of the period of temporary possession which might be taken in terms of section 37 nor the views of the Reporter were of relevance when it came to determining that issue. A CAAD could be of use in valuing land but in the compensatory scheme Parliament had only identified one situation where it had application and that was where land was being compulsorily acquired permanently. It could not, for example, be used in relation to severed land or injurious affectation. That was not to say that the prospect of obtaining planning permission might not be relevant to the assessment of a claim arising from the taking of temporary possession but in such a case it would be for the Lands Tribunal to evaluate (as a percentage) the chances of planning permission in appropriate terms being granted, something that it did regularly, as in Steel v Scottish Ministers 2015 SLT (Lands Tr) 81 or in any case where compensation had to be assessed under paragraph 7 of schedule 4 to the Electricity Act 1989 in respect of the grant of a wayleave for an electric line.
[16] Mr Findlay explained that it was the contention of the Scottish Ministers that section 54(3) of the 2011 Act only incorporates the specified sections of the 1963 Act; otherwise the words in parenthesis would be otiose. The inclusion of the words in parenthesis must have been for some purpose. In the submission of the Scottish Ministers that purpose was to explain that the specified sections were to “have effect in relation to …a dispute so far as applicable and subject to any necessary modifications”, thereby giving the Lands Tribunal a jurisdiction. There were, Mr Findlay emphasised, these two elements: (1) the reference to the sections and (2) the provision as to application subject to modification.
[17] The Scottish Ministers further contended that the words in section 12 of the 1963 Act: “the following provisions of this Part of this Act shall have effect with respect to the assessment” with their reference to “this Part”, in other words part III, are not capable of importing the CAAD provisions from part IV. The CAAD provisions in part IV can only operate in respect of the permanent acquisition of “an interest in land”, as defined by section 30(2) of the 1963 Act, that is an interest proposed to be acquired by an authority possessing compulsory purchase powers in one or other of the three circumstances specified in the subsection: (a) where, for the purposes of compulsory acquisition, a notice required by an Act or by any Standing Order of either House of Parliament relating to petitions for private bills, has been published or served; or (b) where a notice requiring purchase has been served which is deemed to be service of a notice to treat in respect of the interest; or (c) where an offer in writing has been made by the authority to negotiate for the purchase of the interest.
[18] Mr Findlay emphasised that in this area of the law there is a fundamental distinction which is consistently made between the compulsory (and permanent) acquisition of land and compensation for that, on the one hand; and the acquisition of other rights, including the right temporarily to enter and use land, and compensation for that, on the other: see eg the treatment of the subject in Roots et al The Law of Compulsory Purchase (2nd edit). Compensation in respect of land taken is assessed separately from compensation in respect of retained land: see the approach adopted by the Upper Tribunal (Lands Chamber) in Ramac Holdings Ltd v Kent CC [2014] JPL 897. Although concerned with issues relating to costs and so not directly applicable to the present case, the analysis of the Upper Tribunal (Lands Chamber) in BPP (Farringdon Road) Limited v Crossrail Ltd proceeds on the basis of the same distinction between permanent and temporary acquisition of land. The distinction is to be observed in the structure of the 2011 Act. Powers of acquisition are conferred by part 3 of the Act (and, in particular, sections 22, 23 and 29). Powers to enter and use land are conferred by part 5. Compensation for acquisition is dealt with by sections 47 to 50. Compensation for other rights is dealt with by sections 51 to 54.
[19] As supportive of his argument that only the sections of the 1963 Act which are specified in the parenthesis in section 54(3) of the 2011 Act and such other sections as were necessarily linked to these sections (he having conceded that section 12 had the effect of bringing in the rest of part III, so far as applicable) were incorporated for the purposes of compensation for temporary possession, Mr Findlay drew attention to the differences in structure as between sections 21 and 47 of the 2011 Act on the one hand and the provisions of sections 51(3), 52(2), 53(2) and 54(3) (“the subsections (2) and (3)”) on the other. Again, this reflected the distinction between the compulsory acquisition of the ownership of land and the acquisition of other rights. Section 21 (incorporation of the Lands Clauses Acts and the Railways Clauses Consolidation (Scotland) Act 1845) and section 47 (modification of the application of the 1963 Act in respect of determination of compensation) related to compulsory acquisition of the ownership of land. The subsections (2) and (3) (each of which was in the same terms as section 54(3)) related to other lesser rights: servitudes and real burdens, cutting trees, stopping up roads, and entering and using land temporarily.
[20] In the light of his concession that the subsections (2) and (3), including section 54(3) had the effect of incorporating part III of the 1963 Act into the 2011 Act, Mr Findlay drew attention to features of the 1963 Act which pointed to a disjunction between parts III and IV. Whilst various sections in part III of the 1963 Act referred to part IV (eg section 22(7) and section 23(5)) they did not incorporate its terms nor was their operation in any way dependent upon the existence of determinations under part IV. The provisions of part IV flowed from sections 25 and 26. These sections presumed a permanent acquisition of an interest in land; their terms were not capable of being sensibly applied to land temporarily acquired. Moreover, and importantly, part IV of the 1963 Act was free standing in terms of providing for CAADs. It provided a procedure for so doing which did not depend upon part III. Section 30(2) strictly confined the circumstances in which sections 25 and 26 can operate to the acquisition of land: see Portsmouth Roman Catholic Diocesan Trustees v Hampshire County Council 1980 40 P. & C.R. 579 and Porter v Secretary of State for Transport [1996] 2 E.G.L.R 10. Accordingly, mere reference in section 12 to other sections within part III, which themselves make provision to deal with any CAADs that may exist, did not lead to the conclusion that part IV was to be treated as significantly amended and section 30(2) to be ignored. In Mr Findlay’s submission these provisions made it clear that the facility of applying for a CAAD can only be applied in the limited circumstances provided for by the 1963 Act. They did not apply just because the prospect of planning permission may be relevant to the assessment of compensation. For example, it was clear that the CAAD provisions do not apply in respect of land retained by a claimant (ie in respect of which no question of permanent/temporary acquisition applies) even although the prospect of planning permission for such land may play a significant role in valuing the extent of compensation in respect thereof.
[21] Finally, Mr Findlay contended on behalf of the Scottish Ministers that CAADs would not be appropriately used in assessing compensation under section 54(3) and might lead to a windfall for the appellant.
[22] Accordingly, while the Scottish Ministers’ conceded that their error in relation to the inclusion of the permanently acquired land means that their decision must be quashed, the court should confirm that they made no error in concluding that a CAAD could not competently be applied for in respect of the temporarily acquired land.
Second speeches
[23] In a brief second speech Mr Armstrong sought to make four points. The first was in relation to 30(2) of the 1963 Act which Mr Findlay had relied on as providing a comprehensive definition of the circumstances in which an interest in land shall be taken to be acquired for the purposes of section 25. One of these circumstances is that set out in section 30(2)(a) which is where, for the purposes of a compulsory acquisition of land consisting of or including land in which that interest subsists, a notice which required to be published or served in connection with that acquisition, either by an Act or by any standing order of either House of Parliament relating to petitions for private bills, has been published or served in accordance with that Act or Order. The Forth Crossing Bill was introduced in the Scottish Parliament on 16 November 2009. As appeared from the Forth Crossing Bill Explanatory Notes and Other Accompanying Documents Session 3 (2009) paragraph 316, on 13 November 2009 the Scottish Ministers undertook to send copies of the documents required by Rule 9C 3.2 of the Parliament’s Standing Orders (see also paragraphs 302, 303 and 321 of the Explanatory Notes and chapter 6, paragraph 6.1 of the Report). Mr Armstrong’s second point arose from the layout of the 2011 Act and the turning upon itself of an argument advanced by Transport Scotland at paragraph 2.8 of its statement of grounds of appeal against the decision of Fife Council to grant a positive CAAD. The 2011 Act first dealt with powers and then with compensation consequential on the exercise of these powers. In the case of temporary possession the respective provisions were sections 37 and 54. If there was intended to be a disapplication of any provision of the 1963 Act relating to compensation one would expect to find it in section 54 of the 2011 Act, whereas it was not there: cf the correct method of disapplication in terms of section 47(b). Thirdly, Mr Armstrong submitted that Portsmouth and Porter were primarily concerned with compensation in relation to retained land whereas temporary possession was more analogous to permanent acquisition. Mr Findlay had touched on the principle of equivalence with a view to the person compensated being neither better nor worse off in consequence of the exercise of compulsory powers, as mentioned in Ramac Holdings at para 60. The issue of a CAAD, said Mr Armstrong, did not prevent it being argued that the appellant never would have developed the CAAD Land in the relevant period. Fourthly and finally, Mr Armstrong reminded the court that Mr Findlay had not referred to Williamson and Stevens and Sir Douglas Frank’s observations at p122 about the expectation that a claimant for compensation whose claim depended on the planning status of the relevant land should apply for a CAAD.
[24] Mr Findlay, even more briefly, submitted in relation to section 30(2) that Mr Armstrong was not so much seeking to modify it as to amend it; that was to go too far.
Decision
[25] The question that this court has to determine is one of statutory interpretation of a somewhat technical nature which, in the light of a concession made on behalf of the Scottish Ministers, is of less importance than might otherwise have been the case. It is convenient immediately to say something about that concession. The appellant accepts, as it must, that its claim for compensation in respect of it being deprived of possession of the temporarily acquired land is for loss or disturbance in its enjoyment of that possession. As it is not being permanently deprived of the land, its claim is not for the value of the land, as it would be in the case of a compulsory acquisition. Nevertheless, it is the appellant’s position that the assumed planning status of the temporarily acquired land is relevant to the assessment of a claim for loss or disturbance in that the use to which the appellant might have put the temporarily acquired land during the period of its possession by the Scottish Ministers would depend, inter alia, on what planning permission the appellant might have been able to obtain. As it is put at paragraph 2.23 of the appellant’s response to Transport Scotland’s grounds of appeal against the decision of Fife Council to grant a positive CAAD: “…the CAAD informs the assessment of loss and therefore the assessment of compensation.” When presenting its appeal against the decision of Fife Council, Transport Scotland, acting on behalf of the Scottish Ministers, took the position that “Land value has no relevance to a dispute concerning the acquisition of land on a temporary basis under s.37 of [the 2011 Act]” (see Statement of Grounds of Appeal by Transport Scotland dated 3 January 2014 paragraph 1.1). However, in the course of his response to this appeal, counsel for the Scottish Ministers expressly conceded that where temporary possession has been taken of land in terms of section 37 of the 2011 Act, the planning status of that land might be relevant to the assessment of the compensation to which the landowner was entitled under section 54. I accordingly approach the question which we are required to decide, that is whether or not part IV of the 1963 Act has been applied by virtue of section 54(3) of the 2011 Act for the purpose of compensation for temporary loss of possession, on the understanding, derived from what has been said by the parties, that irrespective of which construction is considered to be correct, it will remain open to the appellant to argue that compensation for the taking of possession of the temporarily acquired land should be assessed by reference to the likelihood of a grant of planning permission in particular terms.
[26] Neither counsel commended section 54(3) for its clarity of expression. The subsection (and the other of the subsections (2) and (3)) presents something of the nature of an interpretative puzzle, the clues to which have to be found in the text and structure of the legislation. Neither counsel was able to offer any statutory objective which might provide the basis of a purposive construction. While Mr Findlay repeatedly emphasised the fundamental importance of the distinction between compensation for permanent acquisition (where the facility of applying for a CAAD was available) on the one hand and compensation for the interference with lesser rights (where, according to him, the facility was not available) on the other, he shrank from proposing any underlying principle which might help in interpreting the particular provision which was before the court.
[27] When construing a statute the court must determine and apply the legal meaning of the enactment, that is the meaning that correctly conveys the legislative intention: Bennion on Statutory Interpretation (6th edit) section 150. Usually, as Bennion explains, the legal meaning corresponds to the grammatical meaning of the verbal formula that constitutes the enactment. I therefore begin with what I see to be the grammatical meaning of the relevant words, as read within their immediate context.
[28] Section 54(1)(a) of the 2011 Act confers on a person with an interest in land an entitlement to compensation for loss or disturbance in that person’s enjoyment of the land arising as a result of the Scottish Ministers entering the land and taking temporary possession of it in terms of section 37 of the Act. Section 54(2) confers jurisdiction on the Scottish Lands Tribunal to determine any dispute about the entitlement to or computation of the amount of such compensation. Section 54(3) is concerned with how “Such a dispute is …to be determined”, in other words the way in which the jurisdiction conferred by section 54(2) is to be exercised. How such “a dispute” is “to be determined” may be contrasted with “assessing such compensation”, in other words the way in which compensation may be calculated, which is addressed in section 54(4), thereby suggesting that section 54(3) is a provision dealing with matters of dispute resolution and therefore the procedure to be followed by the Lands Tribunal and only with matters of procedure. That obtains some support from the passage in parenthesis. Outside the parenthesis the subsection provides that “Such a dispute …is to be determined” “in accordance with the 1963 Act as if it were a question of disputed compensation for the compulsory acquisition of land”. There then follows the parenthesis, marked off with brackets. As a matter of grammar, a parenthesis is a word or passage inserted in a sentence the meaning of which is complete without it, the parenthesis being supplementary but not necessary to the meaning of the sentence. Much the same point is made in relation to statutory construction in Craies on Legislation (10th edit) at para 8.2.14 (under the heading “Brackets”):
“Propositions that have no legal effect are commonly found in parentheses in legislation, …
It is sound practice, although not one invariably adopted, to reserve parentheses for material of this kind, having no legal effect and being included merely to assist the reader…”
Mr Armstrong relied on this passage for the proposition that as the words in parenthesis had no legal effect, the subsection had to be understood exclusively by reference to the words outside parenthesis and therefore as any dispute about compensation for a section 37 taking of entry and possession is “to be determined in accordance with the 1963 Act”, all provisions of the 1963 Act, or at least all provisions which could be made applicable, were to be taken to be applicable to resolution of a section 54 claim. I do not accept that proposition. All the words in a statute are to be assumed to have been included in order to assist in making Parliament’s intention clear. That is so even if they appear in parenthesis. Reading section 54(3) as a piece of English would suggest that the draftsman considered that the words in parenthesis logically followed from the preceding words outside parenthesis; in other words that the words in parenthesis are strictly superfluous but are included in order, as Craies has it, “to assist the reader”. Putting it slightly differently, the way the subsection is set out suggests that the reader should be able to work out that the words in parenthesis are a necessary consequence of the preceding words (hence “accordingly”) but that the words in parenthesis are included in order to make the reader’s task easier. For that to be so, the words “so far as applicable and subject to the necessary modifications” which appear in the parenthesis would have to be capable of being implied had it been the case that the words outside parenthesis appeared alone. Mr Findlay submitted that had the words not appeared, given that a dispute about compensation for temporary possession is to be determined “as if it were a question of disputed compensation for the compulsory acquisition of land” (emphasis added) then it would have been necessary to imply “so far as applicable and subject to the necessary modifications”. I would agree with Mr Findlay on that and take the view that the way in which section 54(3) is formulated suggests that in enacting the provision, the Scottish Parliament considered that the provisions which were applicable in the event of a dispute were “accordingly” the specified sections of the 1963 Act: sections 8, 9, 11 and 12; in other words what appears in parenthesis is of the nature of a more specific restatement of what appears outside parenthesis.
[29] In saying that the words in parenthesis are of the nature of a restatement of what appears outside parenthesis I do not mean to suggest that the words in parenthesis are of no importance. I agree with Mr Findlay that their inclusion must be taken to have a purpose and that purpose can only be to draw attention to sections 8, 9, 11 and 12 as being the provisions which are of importance. I therefore reject Mr Armstrong’s suggestion that the plain meaning of the words outside parenthesis in section 54(3) of the 2011 Act is to incorporate all the provisions of the 1963 Act subject only to such modifications as may be necessary.
[30] As I have already touched on, that section 54(3) is to be interpreted as having a more limited rather than a more general effect receives support from the references to “dispute” and “disputed” in section 54(3) and section 54(2). These subsections are about the determination by the Lands Tribunal of disputes over compensation. I would see this as pointing to a weakness in Mr Armstrong’s suggested approach to construction in that it is not obvious why the facility of application for a CAAD should be limited to a situation where there is a dispute to be determined. Speaking generally, a party may wish to apply for a CAAD at the stage where that party is formulating its claim for compensation and therefore before any dispute falls to be determined by the Lands Tribunal. Where what is proposed is the compulsory acquisition of an interest in land, there is nothing in section 25 of the 1963 Act to prevent a party applying for a CAAD at an early stage (and indeed I note that in Rowan Robinson Compulsory Purchase and Compensation The Law in Scotland (3rd edit) at para 7.13 the author states that the intention of section 25 is that “arguments about the hypothetical planning position of the land should be settled before an appropriate forum and in advance of the negotiations over compensation”) but, on Mr Armstrong’s suggested construction, there would have to have been a “dispute” before a CAAD could be applied for in any case where what was proposed was only temporary possession of the land.
[31] I accept that the association between section 54(3) and dispute determination in a purely procedural sense cannot be pushed too far. Sections 8 to 11 comprise part II of the 1963 Act. The heading of part II is: “Determination of questions of disputed compensation by Lands Tribunal”. Sections 12 to 24 comprise part III with the heading: “Provisions determining amount of compensation”. Sections 25 to 30 comprise part IV with the heading: “Certification by planning authorities of appropriate alternative development”. The inclusion of section 12 in the parenthesis in section 54(3) means that in any dispute about compensation for temporary possession of land it is not only the provisions of the 1963 Act relating to procedure before the Lands Tribunal which are to have effect; section 12 brings in rules for assessing compensation, so far as applicable and “the following provisions of [part III of the Act] …with respect to the assessment [of compensation]”. Some at least of the provisions of part VI (“Miscellaneous and general”), including section 41 (application of Act to the Crown) and section 45 (interpretation), must also apply. That much Mr Findlay conceded, as he had to, but he drew the line at application of any of the provisions of part IV of the 1963 Act to a dispute over compensation for temporary possession. He emphasised that while various sections in part III referred to part IV, none of them incorporate it and their operation was not dependent upon it. The part IV provisions presumed the acquisition of an interest in land. I consider that Mr Findlay is right about that and I have concluded that on a proper construction of the 2011 Act it is not competent to apply for a CAAD in respect of land which is not to be compulsorily acquired but is only to be temporarily possessed.
[32] As I have already explained, I do not read section 54(3) of the 2011 Act as applying every provision of the 1963 Act to a dispute as to entitlement to or assessment of the amount of compensation for temporary possession. Rather, such a dispute is to be determined in accordance with the 1963 Act as if it were a question of disputed compensation for compulsory acquisition, with the specified sections having effect so far as applicable. Thus, there are two different sorts of claim arising from the exercise of different sorts of power and the 2011 Act recognises that. I would see it as clear that the facility of applying for a CAAD in terms of section 25 of the 1963 Act arises in the context of the valuation of an interest in land which is to be compulsorily acquired. A CAAD is a certificate “in respect of an interest in land”: section 25(4) of the 1963 Act. Section 25(1) provides that an application under the subsection can only be made with a view to the granting of a certificate “Where an interest in land is proposed to be acquired by an authority possessing compulsory purchase powers”. Section 30(2) of the 1963 Act defines the circumstances in which an interest in land is proposed to be acquired by an authority possessing compulsory purchase powers. The taking of temporary possession under statutory powers is a different situation. In the event of an exercise of the powers conferred by section 37 of the 2011 Act, there is no interest proposed to be acquired by an authority possessing compulsory purchase powers, as that expression is defined by section 30(2) of the 1963 Act. Taken on its own, section 25 and the facility it provides for applying for a CAAD, have nothing to do with compensation for the taking of temporary possession. In his second speech Mr Armstrong drew attention to the fact that the legislative history of the 2011 Act included the giving of notice in terms of Parliamentary Standing Orders, a circumstance falling within section 30(2)(a). That may be so but as it will have been “for the purposes of compulsory acquisition” it cannot have been in respect of the temporarily acquired land which is what is relevant for present purposes.
[33] Nothing in the 2011 Act applies section 25 or any of the other provisions of part IV of the 1963 Act for the purposes of a claim for or dispute over compensation for temporary possession. Mr Armstrong made the point that where the drafter of the 2011 Act wished to disapply particular sections; he did so clearly and explicitly. I accept that that can be said to be so. However, it can also be said that where the drafter of the 2011 Act wished to apply particular provisions he was able to do that explicitly. That is certainly so with the incorporation of provisions of the Lands Clauses Acts and the Railway Clauses Consolidation (Scotland) Act 1845 by section 21. The point can also be made, albeit less strongly, by reference to section 47 of the 2011 Act (with the section heading “Lands Compensation (Scotland) Act 1963”). That section refers to the “application of the 1963 Act to the compulsory acquisition of land under section 22 [of the 2011 Act]” being subject to specified modifications. It is true that the 1963 Act would have applied to a section 22 compulsory acquisition without special provision because the 1963 Act applies to any compulsory acquisition. Nevertheless, section 47 addresses the “application” of the 1963 Act, subject to modifications, in relation to compulsory acquisition. There is no equivalent provision addressing the application of the 1963 Act in relation to compulsory temporary possession.
[34] I have had the opportunity of reading your Lordship’s opinion in draft, with which I respectfully agree. I am particularly grateful for and concur with your Lordship’s analysis of the decision of the Upper Tribunal in BPP (Farringdon) Road Limited v Crossrail Limited and assessment of the application of that decision to the different question of interpretation which faced this court.
Disposal
[35] It is conceded that the decision of the Scottish Ministers was not within the powers of the 1963 Act in so far as it related to the permanently acquired land. In my opinion the decision was within the powers of the 1963 Act in so far as it related to the temporarily acquired land. However, given the Scottish Ministers’ error in relation to the permanently acquired land their decision will be quashed. Whereas the second question presented for the opinion of the court can be answered in the affirmative, the other questions do not admit of succinct answer. It appears to me to be unnecessary to attempt a response to these questions. I would therefore propose to your Ladyship and your Lordship that we should remit to the Scottish Ministers with a view to their confirming the CAAD in so far as the permanently acquired land is concerned and thereafter proceeding in terms of the 1963 Act, with all questions of expenses in this court being reserved.
EXTRA DIVISION, INNER HOUSE, COURT OF SESSION
[2016] CSIH 5
XA28/15
Lord Brodie
Lady Clark of Calton
Lord Malcolm
OPINION OF LADY CLARK OF CALTON
in the appeal to the Court of Session
under section 29 of the Land Compensation (Scotland) Act 1963
by
SCARBOROUGH MUIR GROUP LIMITED
Appellant;
against
a decision of the Scottish Ministers dated 23 February 2015 and communicated to the appellant on 23 February 2015
Respondents:
Appellant: Armstrong QC; Shepherd + Wedderburn
Respondents: Findlay; Scottish Government Legal Directorate
21 January 2016
[36] I have considered the opinions in draft of your Lordship in the chair and the additional observations by Lord Malcolm. I am content to agree with the decision of your Lordship in the chair and the proposed disposal.
EXTRA DIVISION, INNER HOUSE, COURT OF SESSION
[2016] CSIH 5
XA28/15
Lord Brodie
Lady Clark of Calton
Lord Malcolm
OPINION OF LORD MALCOLM
in the appeal to the Court of Session
under section 29 of the Land Compensation (Scotland) Act 1963
by
SCARBOROUGH MUIR GROUP LIMITED
Appellant;
against
a decision of the Scottish Ministers dated 23 February 2015 and communicated to the appellant on 23 February 2015
Respondents:
Appellant: Armstrong QC; Shepherd + Wedderburn
Respondents: Findlay; Scottish Government Legal Directorate
21 January 2016
[37] I have had the advantage of reading a draft of the opinion of your Lordship in the chair. I agree with it and with the proposed disposal. I add the following observations on the question of statutory interpretation.
[38] The proposition for the appellant is that section 54(3) of the Forth Crossing Act 2011 applies the whole of the Land Compensation (Scotland) Act 1963, including the part providing for an application for a certificate of appropriate alternative development (a “CAAD”), to issues of disputed compensation concerning the exercise of the Scottish Ministers’ powers of temporary use of land under section 37 of the 2011 Act. The sub‑section requires to be read as a whole, and in the context of the legislative schemes of the two statutes. The appellant’s approach, in effect, ignores the part of the sub‑section in parenthesis, which incorporates only sections 8, 9, 11 and 12 of the 1963 Act, and then only “so far as applicable and subject to any necessary modifications”. The obvious inference is that the sub‑section is not intended to have the wide effect contended for by the appellant. (It is worth noting that identical phraseology to that used in section 54(3) can be found in the equivalent provisions of sections 51, 52 and 53, which cover disputes regarding compensation for, amongst other things, the extinguishment of servitudes and the cutting down or lopping of trees and shrubs.)
[39] Section 8 of the 1963 Act specifies that the Lands Tribunal for Scotland shall assess compensation in respect of land which is the subject of compulsory acquisition. Section 9 is a procedural provision, and section 11 deals with expenses. Section 12 sets out the rules for assessing compensation for compulsorily acquired land, many of which will have little or no application to section 37 claims.
[40] The fundamental purpose of section 54 is to give the Lands Tribunal jurisdiction in respect of the determination of disputed compensation claims concerning the Scottish Ministers’ use of their powers to take temporary possession of land under section 37. The relevant parts of the 1963 Act do not extend beyond those specified. It is true that section 12 states that the subsequent provisions in the same part of the Act (part 3) shall have effect with respect to the assessment of compensation, but the CAAD provisions are in part 4 of the Act. It is understandable that provisions in part 3 make reference to any certificate issued under part 4 ‑ see sections 22(3A) and 23(5). This occurs in the express context of compulsory acquisition. In my view this provides no foundation for the suggested incorporation of the certificate procedure into claims under section 37 of the 2011 Act.
[41] In any event, even if a more extended meaning can be given to section 54(3) along the lines that other parts and provisions in the 1963 Act are brought into the picture, there remains a significant problem for the appellant’s contention. In particular, the CAAD provisions in part 4 are expressly restricted to, and can operate only in the context of land which is to be the subject of compulsory acquisition. Section 25 of the 1963 Act allows an application for a certificate “where an interest in land is proposed to be acquired.” Counsel for the Scottish Ministers observed, in my view correctly, that to date CAADs have had no part to play in cases of disputed compensation flowing from the exercise of compulsory powers which do not involve the permanent taking of land. It would be surprising if there was any intention to innovate on this in the 2011 Act. The provisions in section 25(2) of the 1963 Act make it clear that the CAAD procedure is restricted to cases where land is to be acquired, not to issues concerning retained land, such as claims of severance or injurious affection. As an example reference can be made to Porter and another v The Secretary of State for Transport [1996] 3 ALL ER 693 (CA) in the judgment of Stuart‑Smith LJ at page 697. His Lordship noted that a certificate:
“has no statutory effect on the planning situation on (land) of the landowner which is not being acquired and in respect of which there may be a claim for the diminution in its value.”
[42] The appellant urged that an extended meaning could be given to the phrase acquisition of “an interest in land” so as to cover the exercise of powers entitling temporary possession and control of land. However, that proposition faces an obstacle in the terms of section 30 of the 1963 Act. It is clear that the legislative intention was to limit CAADs to cases of compulsory acquisition. Thus section 30(2) provides that for the purposes of sections 25 and 26:
“An interest in land shall be taken to be an interest proposed to be acquired by an authority possessing compulsory purchase buyers in the following (but no other) circumstances:”
(a) - reading short - where a statutory notice or a notice governed by a standing order by either House of Parliament relating to petitions for private bills, has been published or served “for the purposes of a compulsory acquisition” by an authority of land in which the relevant interest in land subsists, or
(b) where a notice requiring the purchase of that interest has been served under any enactment, and whereby the authority are deemed to have served a notice to treat, or
(c) where an offer in writing has been made to negotiate for the purchase of the interest.
Contrary to the submission made on behalf of the appellant, I am not persuaded that anything that was done in the present case in pursuit of the Scottish Ministers’ temporary use of the appellant’s land can be brought within the scope of section 30(2)(a) of the 1963 Act. Furthermore, nothing in the 2011 Act signals an intention that CAADs should be available in respect of section 54 (or section 51/53) claims. Thus, even adopting the most extended interpretation of section 54(3), the appellant still faces the difficulty that the CAAD procedure is not available in respect of anything other than the compulsory acquisition of an interest in land as defined by section 30 of the 1963 Act.
[43] Disputed compensation claims under section 37 can be resolved by the Lands Tribunal without any requirement to modify the 1963 Act in this way. Indeed it can be noted that the distinction between compensation for land permanently acquired and other types of claim is recognised in the structure of the 2011 Act itself. In short, whatever else, it is apparent that the provisions in the 1963 Act concerning applications for CAADs are not applicable in the present circumstances. None of this prevents the appellant from asking the Lands Tribunal, when assessing the appropriate level of compensation, to take account of the likely planning status of the land; thus the court’s decision will not have as severe an impact on the potential value of the appellant’s claim as was, apparently, at one time thought to be the case.
[44] For the appellant, considerable reliance was placed upon the decision of the Upper Tribunal in BPP (Farringdon) Road Limited v Crossrail Limited [2015] UKUT 356 (LC). The question was whether the Upper Tribunal had power to award costs in a reference for compensation for the taking of temporary possession of land under the Crossrail Act 2008. It was contended for the claimants that the costs of the compensation proceedings were incurred “in proceedings… for injurious affection of land (or) for compensation for compulsory purchase of land.”, and therefore, under rule 10.6 of the Tribunal Procedure Rules 2010 (as amended), they fell within the tribunal’s power to award costs. The tribunal rejected the argument based upon injurious affection on the view that temporary possession did not damage the land. So far as the alternative argument was concerned, reliance was placed upon paragraph 1(5) of Schedule 5 to the 2008 Act which provides that a dispute over compensation when possession of land is taken for use as a working site “shall be determined under and in accordance with part 1 of the Land Compensation Act 1961”. It was recognised that no interest in land had been acquired by Crossrail, however the Upper Tribunal was invited to apply a broad interpretation to the provision so as to include compulsory acquisition of the right to temporary possession and use of land.
[45] The Upper Tribunal held that the matter before them could “properly be regarded as involving proceedings for compensation for compulsory purchase.” Crossrail had compulsorily acquired a right over the land for which it was liable to pay compensation (para 63). The taking of exclusive control of the land was sufficient to bring the claimants within the phrase “compensation for compulsory purchase of land”, even without the acquisition of an interest in land. Rule 10 intended a broad classification of different types of proceedings in the tribunal. There was no good reason and no policy justification for the exclusion of proceedings concerning compensation for the temporary use of land.
[46] The Crossrail decision concerned the proper interpretation of the Tribunal Procedure Rules, and in particular rule 10 which governs the tribunal’s power to award costs in respect of compensation proceedings. In that context the broad approach taken by the tribunal to the terms of rule 10(6)(a) is wholly understandable. However, it is an entirely different matter to apply similar reasoning to section 54 of the 2011 Act. It requires to be interpreted with regard to its own terms, purpose and background (discussed earlier). In any event, there is no equivalent policy justification for a liberal approach which sweeps the CAAD provisions into a dispute over the exercise of temporary powers. The Upper Tribunal was influenced by the otherwise arbitrary effect of the competing submission. No such factor applies here.