Grants and compensation

General principles

The compulsory purchase system is based on the general principle that an owner of land or rights compulsorily acquired or interfered with is entitled to compensation and should be no worse or better off in financial terms following the acquisition.

The assessment of compensation generally takes into account the open market value of the interest acquired, assessed in accordance with the statutory no-scheme principle, together with any compensation properly payable for severance, injurious affection, disturbance and other recoverable losses.

The principle of equivalence applies to the assessment of compensation. This requires the claimant, so far as money can do so, to be placed in the same financial position as if the land had not been acquired, subject to the statutory rules. The claimant has a duty to mitigate its loss. See Practice Note: Compulsory purchase—compensation.

Compensation Code

The Compensation Code is the collective term used to describe the legislation and case law governing the procedures for compensation following compulsory purchase.

The main statutes are the Land Compensation Acts and the Compulsory Purchase Act 1965 (CPA 1965).

Basis for compensation

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