London’s Court of Appeal today backed the multi-billion pound Crossrail project in a dispute over its compulsory purchase policy relating to unused land.
The case was brought by a leaseholder of a flat in a block that was bought and demolished under a compulsory purchase order by Crossrail to build a new station at Tottenham Court Road.
When the station is finished, there will be a “significant site above ground” that is no longer required for the station. The former leaseholder, Michael Pritchett, claims that he should be given first refusal to develop the site, before it is sold on the open market.
The disposal of land acquired by a public or quasi-public bodies following compulsory purchase orders is laid down in the so called “Crichel Down” (CD) rules, which enable former owners the right of first refusal to re-acquire land at market value.
For the purposes of Crossrail, the rules have been supplemented. However, according to today’s ruling, written by Lord Justice McCombe, the CD rules allowing first refusal don’t apply “when the relevant land has materially changed in character since acquisition”.
The supplementary rules don’t change this, he said, and “the site in issue in this case affords a classic example of such a situation”.
In addition, the rules were modified for the Crossrail project to allow excess land to be sold off “as a whole” rather than in various small parcels.
According to the policy, “the former owner will be given two months from the date of that letter to indicate an intention to purchase. When there is no response or the former owner does not with to purchase the property or there are competing bids from former owners, it will be sold on the open market.”
In February 2014 Crossrail informed all former owners that they had two months to express and interest. Within that period, Pritchett, Aviva Plc and Pearl & Coutts all made expressions of interest.
As there were three expressions, Crossrail informed the parties that they planned to sell the site on the open market.
At a hearing last month, lawyers for Pritchett argued that the decision was unfair because, although there were three bids, they were not actually “competing” as, among other things, there was a possibility that the bidders could form a consortium.
However, the court was unconvinced by this argument.
“A straightforward reading of the policy as a whole”, McComebe LJ wrote, “makes it clear that two or more expressions of interest, whether from individuals or from individuals and a consortium or consortia, amount to competing bids”.
The court dismissed the appeal.
Michael Pritchett v Crossrail Limited, Court of Appeal (Davis LJ, Lewison LJ, McCombe LJ) March 3,2017.
