A Compulsory Purchase Order (CPO) allows certain statutory bodies to obtain land or property from an individual without their consent to do so. These orders will occur when the purchase of said land or property is needed to carry out a function that Parliament feels is in the public’s best interest (1). In practice, the most common users of CPOs are Local Authorities and the Highways Agency. When a CPO is requested a very compelling argument has to be made as to why it would be in the public interest before a CPO is granted.
You may be affected by a CPO if you live within or near to a major development project that will require large amounts of land to go ahead. A good example of this is the development of the High Speed 2 (HS2) railway line which will provide a high speed rail link between London and Birmingham. The scale of this project means that there will be CPOs served to property owners along the proposed route by the Government. Considering the route of HS2 is still in the consultation stage CPOs are unlikely to be issued at the moment. However, once CPOs are issued the government has promised to pay those individuals affected a sum based on the open market value of the properties “as if unaffected by the HS2 scheme (2). Additionally, the Government proposes a home loss payment worth 10% of the property’s value. up to a current maximum of £47,000, plus reasonable moving costs such as surveyor and legal fees and stamp duty on a new property (2).
However, the emotional toll of receiving a CPO is something that needs to be considered. Receiving a fair price and some additional compensation for your home is logically a fine fix but in reality things can be quite different. As the old saying goes ‘A man’s home is his castle’ – where do you stand if you don’t want to move?
It is possible to object to a CPO and have an enquiry into the fairness of the order. This recently happened with a £520 million proposal for the rebuilding of the West Hendon estate in the London borough of Barnet. Barnet Council issued compulsory purchase orders to the tenants of this estate and in January of this year these orders were challenged at a public inquiry by residents who said they were being forced out of the area (3). The residents claimed that the compensation offered (£175,000 for a two-bedroom flat and £115,000 for a one-bedroom flat) would preclude the majority of home owners affected from staying in the estate, an area in which many of them had spent most of their lives. In comparison a two-bed flat build as part of the new development is expected to sell for up to £415,000 (3). In order to be successful in their objection to the CPOs the tenants of West Hendon estate must prove that the proposed development is not in the public’s best interest. The Local Authority in this case argued that the scheme would contribute “very significantly” to the social, economic and environmental well-being of the area, and that the scheme’s public benefits “justify the inevitable interference” with human rights (4). At the time of writing this piece, information on a decision in this case was not available.
References
1. Communities and Local Government Publications (2004) Compulsory Purchase and Compensation Compulsory Purchase Procedure. https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/11487/147639.pdf
2. The Guardian (2012) HS2 and house prices: what the high-speed rail link means to you. http://www.theguardian.com/money/2012/jan/10/hs2-house-prices-high-speed-rail
3. The Guardian (2015) Barnet council ‘engaged in social cleansing’ at West Hendon estate http://www.theguardian.com/society/2015/jan/20/barnet-council-social-cleansing-barratt-homes-west-hendon
4. This is Local London (2015) Public inquiry into Barnet Council’s use of CPOs in West Hendon Estate comes to an end http://www.thisislocallondon.co.uk/news/11762646.West_Hendon_CPO_inquiry_draws_to_an_end/?ref=mr
This article was submitted to be published by Groundsure Ltd. as part of their advertising agreement with Today’s Conveyancer. The views expressed in this article are those of the submitter and not those of Today’s Conveyancer.
