The following Planning practice note produced in partnership with Stephen Morgan of Landmark Chambers provides comprehensive and up to date legal information covering:
The compulsory purchase system is based on the principle that an owner of land or rights compulsorily acquired or interfered with is entitled to the payment of compensation. Thus, assessment of the compensation is a key element in the compulsory purchase process, see: Compulsory purchase—procedure. This Practice Note outlines the key principles that apply to the assessment of compensation arising out of the compulsory acquisition of an interest in land.
Important changes relating to compensation for compulsory purchase are being introduced by Part 2 of the Neighbourhood Planning Act 2017 (NPA 2017) which received Royal Assent on 27 April 2017. Not all of these provisions are yet in force as indicated below.
A person with an interest in the land the subject of a compulsory purchase order (CPO), as defined in the Compulsory Purchase Act 1965 (CPA 1965), (in particular the freehold owner, leaseholder, tenant or mortgagee) and those owners of adjoining land with rights over the subject land (such as easements and restrictive covenants) may be entitled to compensation for any recoverable loss or damage. Others may also have an entitlement to compensation, as addressed below.
The general principle of compensation for compulsory purchase is that the claimant should be no worse or any better off in financial terms following the acquisition. This is referred to in the legal authorities as the principle of
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