Greater London Council v Holmes

Land Compensation Act 1973 — Entitlement to home loss payment — Appeal by applicant against judge’s decision in favour of acquiring authority — Appeal raised two questions: (1) Whether, at date of appellant’s displacement, the land, which had been compulsorily acquired, was for the time being held by the respondent authority for the purpose for which it was acquired, and (2) whether the appellant’s displacement was ‘in consequence of the carrying out of redevelopment on the land’ — The facts were that at the time of acquisition of the site it had been the intention of the respondent authority to clear the site and build local authority housing on it — The plan was, however, subsequently changed and it was decided to dispose of the land in the open market for housing by a private developer — Held, on the first question, disagreeing in this respect with the judge’s decision, that although the original concept was the provision of local authority housing, the broad ‘purpose’ for which the land was acquired was that it should be cleared for the erection of houses and at the material time it was still held for that purpose — Held further, on the second question, again disagreeing with the judge’s decision, that the appellant was displaced in consequence of redevelopment carried out by the respondent authority — It had been argued on behalf of the authority that demolition carried out to clear the land for sale to a purchaser was not redevelopment, which meant putting up new buildings — The Court of Appeal, rejecting this argument, considered that the demolition which resulted in the appellant’s displacement was an essential step in the process of redevelopment which was begun by the respondents but was intended to be completed by the purchaser — Appeal allowed and the questions raised as to the appellant’s entitlement to a home loss payment answered in his favour This was an appeal from a decision of Judge Sir William Stabb QC, sitting as a High Court judge, by Leonard Thomas Holmes, who had, until displaced, been the occupant of a mobile home on a site at 37 Clark Street, London E1, in the borough of Tower Hamlets. The judge had answered in favour of the respondents, the Greater London Council, certain questions raised by an originating summons as to the entitlement of the appellant to a home loss payment under Part III of the Land Compensation Act 1973. D R Watkinson (instructed by May Maughan, Tower Hamlets Law Centre) appeared on behalf of the appellant; M G Anthony (instructed by R A Lanham, Greater London Council) represented the respondents. Giving judgment, OLIVER LJ said: This is an appeal from an order of His Honour Judge Sir William Stabb QC, made on February 17 1984, by which he answered in favour of the respondent, the Greater London Council, certain questions raised by an originating summons as to the entitlement of the appellant to a ‘home loss’ payment under the provisions of the Land Compensation Act 1973. The summons, the evidence in support of which consisted simply of an agreed statement of facts with some supporting documents, raised two questions, the first of which was expressed in very general terms, that is to say, whether the appellant was entitled to a payment as a person displaced from his home in consequence of the carrying out of redevelopment on the site on which his home was situate. The second question was whether displacement consequential on a decision of the respondent to clear the land and sell with vacant possession constituted displacement from a dwelling on land ‘in consequence of the carrying out of redevelopment on the land’. As regards the first question it is agreed that the real issue raised is a much narrower one, namely that of the purpose for which the land was held by the respondent at the time when the appellant was displaced. The section of the Land Compensation Act 1973 with which this appeal is concerned is section 29(1)(c). It appears in Part III of the Act, which is headed ‘Provisions for Benefit of Persons displaced from land: Home loss payments’, and is in the following terms: 29. (1) Where a person is displaced from a dwelling on any land in consequence of (a) the compulsory acquisition of an interest in the dwelling; (b) the making, passing or acceptance of a housing order, resolution or undertaking in respect of the dwelling; (c) where the land has been previously acquired by an authority possessing compulsory purchase powers or appropriated by a local authority and is for the time being held by the authority for the purposes for which it was acquired or appropriated, the carrying out of redevelopment on the land, he shall, subject to the provisions of this section and section 32 below, be entitled to receive a payment (hereafter referred to as a ‘home loss payment’) from the acquiring authority, the authority who made the order, passed the resolution or accepted the undertaking or the authority carrying out the redevelopment, as the case may be. The remaining subsections of the section deal with the qualifications for entitlement and it is unnecessary to refer to them because it is common ground that, subject to the two questions raised on the appeal, the appellant was otherwise qualified to receive a payment. The instant case is not one where the land concerned had been ‘appropriated’ by the local authority. It was land which was compulsorily acquired and it is agreed that, subject to the question of whether the displacement was in consequence of redevelopment by the respondent, the only question which requires to be answered is whether at the time of the displacement the land so acquired was, on the true construction of the section, being held by the respondent for the purposes for which it was acquired. The relevant facts as they appear from the agreed statement are as follows: The appellant became the tenant of a mobile home at 37 Clark Street, London E1 (in the Borough of Tower Hamlets) in April 1967 and until displaced in April 1980 occupied that site as his only home. Clark Street runs parallel to Ashfield Street and the block of land between the two (which included no 37) was known as ‘the Ashfield Street site’. It had been compulsorily acquired in 1963 and we have been given to understand (though this does not appear in the agreed statement) that it was acquired under powers conferred by the Housing Act 1957. It may be convenient to refer to the relevant provisions of that Act at this stage, since they form the basis of one of Mr Watkinson’s submissions on behalf of the appellant. Section 96 of the Act provides that ‘a local authority shall have power under this Part of this Act (a) to acquire any land, including any houses or buildings thereon, as a site for the erection of houses . . .’. Section 97 authorises the acquisition either by agreement or by compulsory purchase and provides that, with the consent of the minister, land may be acquired for the statutory purposes even if not immediately required for these purposes if it appears to the minister that it is likely to be required for those purposes within 10 years from the date on which he confirms the compulsory purchase order. 23 Section 96(e) authorises acquisition for the purposes of the sale or lease of the land under powers conferred by para (a) of subsection (1) or by subsection (2) of section 105 of the Act — a paragraph which provides that where land has been acquired for the purposes of the Act it may, with ministerial consent, be sold or leased for the purpose and subject to conditions as to the erection of numbers and types of houses specified by the local authority. Section 105(1)(b) also contains a general power, with the consent of the minister, to sell the land. Returning to the agreed facts, it appears that the immediate provision of housing was satisfied, at any rate so far as the appellant was concerned, by the provision of a mobile home, but para 5 of the agreed statement indicates what, so it is said, the respondent’s ultimate intention was. Para 5 of the statement reads as follows: At the time of acquisition of the site, it was the intention of the plaintiffs to clear the site and to build housing thereon as is shown by the outline planning brief dated April 4 1979, a copy of which is appended hereto at Appendix 2. How the intention of the respondent in 1963 is manifested by a document brought into being some 16 years later is not entirely clear, but we have to accept the agreed statement at its face value and it is not in dispute that the intention with which the land was acquired was the clearance of the site and the provision of local authority housing. It is unnecessary to refer in any detail to the housing brief, but the following paragraphs may be material. Para 1.4 is headed ‘Site Availability’ and reads: The site can be made available when required subject to the usual arrangements for programming the rehousing and clearance. Para 2.1 describes the type of housing proposed, that is, a mixture of flats and houses. Section 3.2 is headed ‘Statutory Position’ and reads: These sites are vested in this Council and are zoned in the Initial Development Plan for public open space. As the IDP is still in the statutory document for the area, the proposed housing development will conflict with the provisions of the plan and will have to be advertised. Part 4 of the brief indicates a programme providing for the scheme and estimate to be produced by April 1980. By July 1979, however, the picture had changed and on July 16 1979 the respondent’s housing development committee ordered all work on the project to be stopped. A report on August 31 1979 listed a number of options for the development of the land, one of which was sale on the open market for housing use. On February 11 1980 the housing policy committee resolved that the Ashfield Street Scheme be not proceeded with and that the central area planning committee be informed that the sites ‘are surplus to, or are not required for the purposes of the Council’s own housing programme’. It recommended that the site be disposed of by ‘open market sale for housing for sale’. That was confirmed by the central area planning committee on February 13 1980. Thereafter the appellant was visited by a housing welfare officer and sent a leaflet explaining his possible entitlement to home loss and disturbance payments but prefaced by a caution that the issue of the leaflet did not necessarily imply any liability on the part of the respondent for such payment. The appellant then vacated the site on April 12 1980 and was rehoused. Thereafter, as I understand it, the respondent proceeded with the demolition of buildings on the site and its clearance in order to enable it to be sold with vacant possession for housing development by private developers. The first question raises a short but not altogether easy point of construction against the background facts of this case, and that is simply what is meant by the words ‘the purposes for which it was acquired’. The respondent’s contention, which succeeded before the judge, is that ‘purpose’ is not to be distinguished from ‘intention’. The ‘intention’ of the local authority here was that the land should be cleared and redeveloped by the erection of houses by or under the control of the local authority in accordance with a scheme which they subsequently evolved but which had the important characteristic that the title to the land at that time was intended to remain with the local authority and the housing provided on it was to be part of the local authority’s housing stock. Thus, Mr Anthony argues, when the respondent resolved in 1980 to clear the land and dispose of it in the market, this was a complete change of intention which resulted in the land now being held by it for the purpose of sale and disposal. The learned judge accepted that argument. He said: It seems to me that the Greater London Council by abandoning their original intention to redevelop the land, and by resolving that the land should be sold to a purchaser for the purpose of that purchaser building houses, were divorcing themselves from the whole original concept. They no longer could be said to be holding the land for the purpose for which it was acquired, which I hold to be for the purpose of redevelopment by themselves. Mr Watkinson submits that this approach puts altogether too narrow a construction upon the critical phrase ‘purpose for which it was acquired’. ‘Purpose’ may sometimes equate precisely with intention, but in the context of this Act, which is to compensate (inter alia) people displaced as a result of the exercise of statutory powers for the disturbance resulting from their being deprived of their homes following acquisition, one has to look not at the precise scheme which the acquiring authority may have had in mind at the particular time or any subsequent time for the carrying out of the statutory purpose, but at the general purpose upon which reliance was placed in making the original acquisition. Here the acquisition was for the purpose specified in section 96(a) of the Act of 1957 to which reference has already been made. That purpose still exists and the fact that the acquiring authority has proposed to carry it out by clearing the site and selling to a private developer for him to erect the houses does not alter the fact that the land was at the material time held as a site for the erection of houses. Speaking for myself, I do not derive a great deal of assistance from a consideration of the Housing Act 1957 or the precise statutory purpose which justified the original acquisition of the site by the respondent in 1963. If ‘purpose’ in the Land Compensation Act 1973 was intended to refer to the statutory justification for the original acquisition, then I am persuaded by Mr Anthony’s argument that, on that analysis, the ‘purpose’ of selling the land in 1980 was not the same purpose as the purpose of acquisition in 1963. If one assumes that the statutory ‘purpose’ of acquisition was that described in section 96(a) of the 1957 Act, that must, as it seems to me, be construed, as a matter of necessary implication, as the purpose of erecting houses by the local authority for it contrasts with the purpose specified in sections 96(e) and 105(a). A decision to sell for private development outside the control of the local authority would involve invoking the provisions of section 105(1)(b) and that would, in my judgment, be a different purpose. On the other hand, I am not persuaded that the expression ‘the purposes for which it was acquired’ in section 29(1)(c) of the Act of 1973 falls to be construed in the narrow way suggested by Mr Anthony as synonymous with the intention of the acquiring authority to carry out a particular scheme of development. One has, as it seems to me, to look at the Act as a whole and to give a purposive construction to its provisions. The legislature clearly intended to produce a scheme for the payment to a person who was compelled to vacate his home as a result of development carried out under compulsory powers of compensation for the loss of his home and of assistance with the expenses necessarily entailed in moving. It is to be noted in this connection that the conditions for payment of disturbance allowances in section 37 of the Act are the same as those for home loss payments under this section. The matter is to a large extent one of impression, as so many points of construction are, but although the arguments are finely balanced, I have not, for my part, felt able to take the same restrictive view of the word ‘purpose’ as that adopted by the learned judge. While it is true that the original concept was, no doubt, the provision of local authority housing, the broad ‘purpose’ for which the land was acquired was that it should be cleared for the erection of houses. The fact that the respondent abandoned the idea of erecting houses itself and proceeded to move the tenants with a view to clearing the site so that someone else could erect houses there does not, in my judgment, involve the conclusion that the land was not at the material time held for the purpose for which it was acquired. So far as the tenant is concerned, he has been removed and disturbed in order to enable the original purpose of housing development to be carried out and it would, in my judgment, defeat the purpose of the Act to hold him deprived of compensation for his loss because the acquiring authority has chosen to stop its own operations at the point of completion of clearance and to arrange for the process of housing development to be completed by someone else. I find it difficult to accept that the legislature, in framing a statute designed to provide compensation for disturbance on redevelopment pursuant to compulsory powers, could have envisaged that payment could so24 easily be avoided by taking all the necessary steps to permit the proposed redevelopment to take place and then handing the actual process of erecting houses to someone else by way of compensation-free realisation. While, therefore, I have not found the question an easy one, I would answer the first question in the sense opposite to that urged by Mr Anthony and found by the learned judge. That, however, does not dispose of the matter, because there remains the further question whether the displacement of the appellant was in fact the consequence — and Mr Anthony stresses these words — of the carrying out of the development on the land by the respondent. As he points out, the machinery of the Act is to enable the displaced person to obtain his home loss payment from the authority which carries out the redevelopment and from no one else. If therefore one finds that the appellant was displaced by something legitimately called ‘redevelopment’ one still has to find, before he establishes his claim, that that redevelopment was carried out by the respondent. The argument here is that the mere act of demolishing so as to provide vacant possession for a purchaser who is going to carry out housing development is not itself redevelopment. The point is encapsulated in the following extract from the judgment of the learned judge: Furthermore, in my judgment, a step in connection with or for the purpose of the sale cannot properly be said to be part of a process of redevelopment; it is part of the process of the sale and not of the redevelopment, which, as I have said, must be a redevelopment carried out by the authority who made the payment, as the concluding words of section 29(1) make clear. If the words ‘the carrying out of redevelopment’ are to be given their ordinary meaning, as it was said that they should by Lord Widgery CJ in R v Corby District Council [1975] 1 WLR 735, then I would consider those words to mean, or at least to include, the putting up of new buildings. Here the Greater London Council are not to put up any new buildings, and therefore cannot be said to be carrying out any redevelopment. Any other construction, with all respect to Mr Watkinson’s able and closely reasoned argument, would in my view be putting an unjustifiable strain on the words of the section. Mr Watkinson relies heavily upon the case of R v Corby District Council and the subsequent case of Follows v Peabody Trust [1983] 10 Housing LR 62 as establishing that demolition, so long as it forms merely a step in a larger process of redevelopment, can itself constitute redevelopment for the purpose of the section. In the former case the tenant of an aluminium bungalow had been displaced and rehoused following the demolition of his bungalow as part of a scheme of clearance prompted by the fact that a great many of the similar bungalows on the estate had become unfit. Lord Widgery CJ at p 738 said: Mr Knight contends, and I think this is perhaps his best point, that when one looks at the language of section 29 it clearly contemplates a causal connection between the displacement of the tenant and the factor causing displacement, which is referred to later in the subsection. He says that these tenants were not displaced because of the carrying out of the redevelopment on their land. He says that Mr McLean was displaced because his bungalow proved unfit. It is an interesting argument, but for my part I do not think it stands up to consideration for very long. I do not see why in principle, or, as Bridge J put it in argument, as a result of any social principle, a distinction should be made in these cases between the private tenant who is evicted because his house is unsuitable and the local authority tenant who has to give up possession of his house for the same reason. It seems to me that the same principle should apply to each, and I have no difficulty, speaking for myself, in saying that the carrying out of redevelopment in this section should be given its ordinary common sense meaning and can go back to and include the act of demolition which precedes the substitution of new buildings which are to come under a redevelopment scheme. The same approach is reflected in Follows v Peabody Trust where Cumming-Bruce LJ at pp 73-4 said: The next question is the question did the plaintiff prove that there was a carrying out of redevelopment?  Demolition is not synonymous with redevelopment. There may be demolition and no redevelopment; there may be demolition entirely unconnected with any scheme of redevelopment. At the other end of the spectrum there may be demolition which is only undertaken by the owner as a step in a process of redevelopment. It is a question of fact in any case where demolition is in contemplation whether that demolition at that date may sensibly and reasonably be held to be one step in a process of redevelopment, or whether it is demolition without sufficient nexus with redevelopment so that it is not, for the purposes of these two subsections, to be regarded as the carrying out of redevelopment. In every case it must be a question of fact to decide on which side of the line a demolition is proved to fall at the relevant date. Similarly, Sir Denys Buckley at p 80 observed: The judge held that the words ‘carrying out of redevelopment’ refer to a continuing process and one wide enough to cover any material stage in the achievement of contemplated redevelopment. The use of the word ‘redevelopment’ infers that the relevant land is not a virgin site but has already been developed in the past, where, as in this case, an authority acquired property which is encumbered with unwanted buildings, with a view to its redevelopment and the continued existence of those buildings would inhibit the proposed redevelopment, the demolition of those buildings may easily be found to constitute an integral part of the development, notwithstanding that at the date of demolition it may be uncertain when the redevelopment is likely to be completed and even if it may then be uncertain how it may be completed or whether it will ever be completed. Whether there has been a step which constituted an act of redevelopment is, I would agree with my lord, one of fact to be determined in the light of the surrounding circumstances and this, in my view, would be nonetheless true because the early taking of such a step as demolition might have financial advantages of a short-term nature unrelated to the achievement of the projected development such, for example, as matters of good estate management. As Mr Anthony points out, however, both those cases were cases where the authority concerned was itself proceeding with the subsequent stages of the redevelopment, albeit possibly much later on. Here, by contrast, the demolition was an act designed to clear the land for sale and subsequent redevelopment by a purchaser and he argues that the contrast points to the conclusion for which he contends. That argument has its attraction, but again I have not myself felt able to accept it. Whether demolition per se constituted a ‘redevelopment’ for the purposes of the Act must be a question to be decided on the facts of the particular case. There is nothing in the agreed facts here to lead to the conclusion that demolition and clearance was an isolated measure prerequisite to the disposal of the land and unrelated to the subsequent erection of houses upon it. It was, as I see it, something done to enable the respondent to dispose of the land more advantageously for the purposes of enabling it to be developed as a housing estate by the purchaser. I do not think that the question of the status of demolition can be divorced from the first question which I have already sought to answer. If one asks: ‘Was the land still held at the date of the respondent’s decision for the purposes of housing redevelopment?’  I, for the reasons already given, think that that question must be answered affirmatively. If that be right, then it seems to me that the demolition which resulted in the appellant’s being displaced was an essential step in the process of redevelopment which at that stage was being carried out by the respondent but, following a sale, was intended to be completed by the purchaser. It was done to enable or encourage the purchaser to carry out the original purpose of acquisition and I would hold that it had itself the character of redevelopment and redevelopment carried out by the respondent. I would accordingly allow this appeal and substitute affirmative answers to both questions raised by the summons. RALPH GIBSON LJ and ANTHONY LINCOLN J agreed and did not add anything. The appeal was allowed with costs. Legal aid taxation was ordered.