Porter and another v Secretary of State for Transport

Compulsory purchase — Compensation — Certificate of appropriate alternative development under section 17 of Land Compensation Act 1961 — Issue estoppel — Whether evidence can be adduced to show that conclusions by which certificate issued should not be followed in assessing compensation The claimants owned land on the outskirts of Evesham. The Secretary of State for Transport acquired two strips of land (‘the red land’) from the claimants for the construction of a bypass (‘the yellow route’), and took possession on September 20 1985. The claimants retained adjoining land (‘the blue land’). Following an appeal under section 18 of the Land Compensation Act 1961, the Secretary of State for the Environment granted a certificate of appropriate alternative development for the red land for residential development. He agreed with the reasoning of his inspector and concluded that because there was an alternative and more easterly route for the bypass, the red land could have been residentially developed if it were not being acquired by the acquiring authority for the yellow route. In the reference to the Lands Tribunal, the acquiring authority sought to adduce evidence that the conclusions of the Secretary of State for the Environment should not be followed in assessing compensation for severance and injurious affection in respect of the blue land. At the hearing of a preliminary point of law, the tribunal accepted the claimant’s contention that the Secretary of State for Transport was precluded by the doctrine of issue estoppel from reopening the issue determined by the certificate of appropriate alternative development. The Secretary of State for Transport appealed. Held: The appeal was allowed. 1. Per Stuart-Smith and Thorpe LJ: the decision of the Secretary of State for the Environment on an appeal under section 18 of the Land Compensation Act 1961 cannot give rise to estoppel per rem judicatam or an issue estoppel. Per Peter Gibson LJ: the determination by the Secretary of State of an issue of hypothetical fact in reaching his decision under section 18 is one to which an issue estoppel can apply. 2. However, the issue determined by the Secretary of State was not the same as that which has to be determined by the Lands Tribunal. The Secretary of State does not have to evaluate the chance of an alternative route being chosen, provided it was more than 50%; the tribunal would be concerned in assessing value to evaluate the chances of this happening more precisely. The following cases are referred to in this report. Allied Maples Group Ltd v Simmons & Simmons [1995] 1 WLR 1602, CA Carl Zeiss Stiftung v Rayner & Keeler Ltd (No 2) [1967] 1 AC 853; [1966] 3 WLR 125; [1966] 2 All ER 536, HL Davies v Taylor [1974] AC 207; [1972] 3 WLR 801; [1972] 3 All ER 836, HL Fidelitas Shipping Co Ltd v V/O Exportchleb [1966] 1 QB 630; [1965] 2 WLR 1059; [1965] 2 All ER 4; [1965] 1 Lloyd’s Rep 223, CA Hoystead v Commissioner of Taxation [1926] AC 155, PC Pointe Gourde Quarrying & Transport Co Ltd v Sub-Intendent of Crown Lands [1947] AC 565, PC Thoday v Thoday [1964] P 181; [1964] 2 WLR 371; [1964] 1 All ER 341, CA Thrasyvoulou v Secretary of State for the Environment [1988] 1 QB 809; [1988] 1 EGLR 192; [1988] 10 EG 131 and 11 EG 83; [1988] 2 PLR 37 Thrasyvoulou v Secretary of State for the Environment; Oliver v Secretary of State for the Environment [1990] 2 AC 273; [1990] 2 WLR 1; [1990] 1 All ER 65; (1989) 59 P&CR 326; [1990] 1 EGLR 197; [1990] 13 EG 69; [1990] 2 PLR 69, HL This was an appeal by the Secretary of State for Transport from a decision of the Lands Tribunal on a preliminary point of law in a reference by the claimants for the determination of compensation arising out of the compulsory purchase of land by the acquiring authority. Michael Barnes QC and Christopher Katkowski (instructed by the Treasury Solicitor) appeared for the appellant; Malcolm Spence QC and Nicholas Nardecchia (instructed by Rooks Rider) represented the respondents. Giving the first judgment, Stuart-Smith LJ said: This is an appeal by way of case stated from a decision of the Lands Tribunal (the president, Judge Marder QC) dated January 6 1995. By virtue of section 3(4) of the Lands Tribunal Act 1949 the appeal is on law only. The appellant is the acquiring authority. The case concerns the determination of the compensation payable by the Secretary of State for Transport to the claimants for land acquired by him for the construction of the Evesham bypass. The particular point in issue is whether the Secretary of State for the Environment in issuing a certificate of appropriate alternative development on an appeal to him under section 18 of the Land Compensation Act 1961, can give rise to an issue estoppel which binds the claimants and the acquiring authority in subsequent proceedings before the Lands Tribunal to assess the compensation. The point was decided by the president of the Lands Tribunal on a preliminary issue to the effect that there could in principle be an issue estoppel in the above circumstances. He further held that on the particular facts before him there was an issue estoppel. The Secretary of State for Transport in this appeal contends, first, that in principle there cannot be an issue estoppel where the decision said to found the estoppel is one of the exercise of discretion such as a decision relating to the grant or refusal of planning permission. Second, it is submitted that the issue said to have been decided by the Secretary of State is not the same as that which falls to be decided by the Lands Tribunal and accordingly there is no issue estoppel. In 1985 the Secretary of State for Transport proposed to construct a new highway to be part of the A435 trunk road which would run to the east of the town of Evesham and would serve as a bypass to that town. The claimants own an area of freehold land to the east of Evesham which is shown edged blue on the plan. The line of the proposed 11 highway would pass across the claimants’ land. The proposed line is shown coloured yellow on the plan (save that where it crosses the claimants’ land it is coloured red). In order to acquire the necessary land the Secretary of State made the Bath-Lincoln Trunk Road (A434-Evesham by-pass) Compulsory Purchase Order 1985 under powers conferred on him by the Highways Act 1980. The land to be acquired included a part of the claimants’ land, namely the strip shown coloured red on the plan (which was, of course, a portion of the line of the proposed road). Entry on the claimants’ land was made on September 20 1985. That date became the valuation date for the purposes of assessing compensation. Compensation for land compulsorily acquired is assessed in accordance with principles contained in the Land Compensation Act 1961 (‘the 1961 Act’) and the Compulsory Purchase Act 1965. It is usual to divide the amount of the compensation payable into three components: (1) the value of the land acquired; (2) any diminution in the value of other land of the owners’ retained by them where the diminution is brought about by the acquisition of the land taken; and (3) disturbance. In the present case there is no relevant disturbance claim. The assessment of the first component, the value of the land taken is governed by r(2) of section 5 of the 1961 Act which provides: The value of land shall, subject as hereinafter provided, be taken to be the amount which the land if sold in the open market by a willing seller might be expected to realise: The assessment of the second component is governed by section 7 of the Compulsory Purchase Act 1965, which provides: In assessing the compensation to be paid by the acquiring authority under this Act regard shall be had not only to the value of the land to be purchased by the acquiring authority, but also to the damage, if any, to be sustained by the owner of the land by reason of the severing of the land purchased from the other land of the owner, or otherwise injuriously affecting that other land by the exercise of the powers conferred by this or the special Act. In assessing compensation no account is to be taken of any increase or decrease in the value of the land which is due to the scheme which underlies the compulsory acquisition: see Pointe Gourde Quarrying & Transport Co Ltd v Sub-Intendent of Crown Lands [1947] AC 565, and section 6 and Schedule 1 to the 1961 Act. The claimants consequently claim compensation for (a) the value of the land taken (the red strip on the plan) and (b) a diminution in the value of the land retained by them (the remainder of the blue edged land on the plan after excluding the red strip). In order to assess the land value in both cases it was necessary to ascertain what planning permission (if any) enured for the benefit of the areas of land involved. In accordance with the Pointe Gourde principle the question of what planning permission was to apply to the areas of land had to be ascertained ignoring the effects of the proposal to construct the new highway. Sections 17 and 18 of the 1961 Act contain a statutory procedure for the determination of this question in relation to the land acquired. An application may be made to the local planning authority by either the landowner or the acquiring authority for a certificate of appropriate alternative development (a ‘section 17 certificate’). On receipt of an application the local planning authority are required by section 17(4) to issue a certificate either (a) that in their opinion if the land were not proposed to be acquired compulsorily planning permission would have been granted for a class or classes of development specified in the certificate, or (b) that in their opinion in the above circumstances planning permission would not have been granted for any development. The latter form of certificate is often called a nil certificate. Sections 14(1) and 15(5) of the Act provide that in ascertaining the value of the relevant interest it shall be assumed that planning permission would be granted in accordance with the certificate. It should be noted that the provisions of section 17 and sections 14(1) and 15(5) are such that the certificate, and any planning permission assumed in accordance with the certificate, relate only to the interest in land proposed to be acquired. It follows that a certificate may determine the situation as regards planning permission on the land being acquired, but has no statutory effect on the planning situation on other land of the landowner which is not being acquired and in respect of which there may be a claim for the diminution in its value. Section 18 contains a procedure by which the landowner or the acquiring authority may appeal to the Secretary of State for the Environment against the decision of the local planning authority in issuing a certificate under section 17. Section 18(3) prescribes that, if required by either party, the Secretary of State must hold a hearing before an appointed person (ie an inspector) before determining the appeal. The claimants contended that in the absence of the highway scheme planning permission would have been granted to develop their land residentially. Accordingly, they said that the value of the land taken and their claim for compensation for diminution in the value of the land retained should be assessed on the basis of the potential of the land for residential development. They applied to the local planning authority, Wychavon District Council, for a section 17 certificate certifying residential development as the appropriate alternative development. That council issued a nil certificate (save in respect of a small and immaterial part of the land being acquired). The claimants appealed to the Secretary of State for the Environment under section 18 of the Act. A hearing was held before an inspector in May 1988 and the inspector reported to the Secretary of State on September 23 1988. A question which arose at the hearing was what new highway provision (if any) would have been made in the vicinity of Evesham in the absence of the proposal to acquire the claimants’ land to construct a bypass on the line shown in yellow on the plan. The claimants contended that what would have happened in this hypothetical situation is that a bypass would have been constructed to the east of the town on a line shown in green on the plan (the ‘green route’). The green route would have passed through the claimants’ land some distance to the east of and roughly parallel with the route actually constructed. The actual route and the green route start and end at approximately the same point but take a somewhat different intermediate course. In other words in highway terms they both fulfil much the same function of providing a bypass for traffic to the east of Evesham. The purpose of the claimants in making the contention which they did was that they argued that if there was assumed to be a bypass on the green route that highway would form a physical boundary to the outward spread of Evesham and would add force to their argument that planning permission would then have been granted for the residential development of the greater part of their land which lay inside the physical boundary. At the hearing the local planning authority felt unable to answer the question of what road project there would have been apart from the project on the line proposed by the Secretary of State for Transport. The Secretary of State was invited to attend the proceedings in order to assist on this matter. He was in any event entitled to attend the hearing by reason of section 18(3) of the Act. The submissions made on behalf of the Secretary of State were that if the actual route had not been implemented there would either have been no scheme, or if there was one, the most likely alternative route would have been (a) a combination of a central route and a southern bypass and eastern link, or (b) if an eastern route alone had been selected as an alternative to the actual route an inner eastern route would have been chosen. The inspector who held the hearing rejected the Secretary of State’s submissions and concluded that the green route was the most likely alternative route. He included this conclusion in his report to the Secretary of State, and recommended at para 8.1 of his report that the appeal be allowed and a section 17 certificate be issued specifying residential development as the appropriate alternative development. The Secretary of State in substance agreed with the inspector and on November 30 1988 he issued a section 17 certificate with residential development specified. The result of the decision of the Secretary of State and of the certificate issued is that in the valuation of the land acquired from the claimants it must be assumed that planning permission would be granted for its residential development. The whole of the claimants’ 12 claim for compensation (that is the claim to the value of the land acquired and the diminution in the value of their remaining land) was referred by them to the Lands Tribunal. Mr Malcolm Spence QC, on behalf of the respondents, contends that even if the section 17 certificate does not preclude the Lands Tribunal from reaching a conclusion that planning permission for housing would not have been granted for their land to the west of the green route, the finding of the inspector, accepted by the Secretary of State, that if the actual route had not been adopted, the bypass would have been constructed on the line of the green route creates an issue estoppel and the acquiring authority cannot dispute this in the proceedings before the Lands Tribunal. The distinction is perhaps a fine one, because, if the green route had been constructed, it is very likely that it would have formed the eastern boundary of the town’s development and the respondents would therefore have been likely to have obtained planning permission up to this line. This distinction is one to which Mr Spence attaches some importance, although it is not fully reflected in the preliminary question of law posed for the decision of the Lands Tribunal which is in these terms: Whether the doctrines of res judicata and/or issue estoppel apply in the circumstances of this case so as to preclude the acquiring authority from calling evidence before, and making submissions to the tribunal, that the conclusions reached by the Secretary of State for Environment as set out in a letter dated November 30 1988 whereby he decided to issue a certificate under Section 17 of the Land Compensation Act 1961 for residential development of the land acquired from the claimants should not be followed and applied by the tribunal in assessing the amount of compensation to be paid in respect of severance and/or injurious affection to the land retained by the claimants. The principles of estoppel per rem judicatam and issue estoppel are explained by Diplock LJ in Thoday v Thoday [1964] P 181 at pp197–8 he said: … estoppel per rem judicatam … is a generic term which in modern law includes two species. The first species, which I will call ’cause of action estoppel,’ is that which prevents a party to an action from asserting or denying, as against the other party, the existence of a particular cause of action, the non-existence or existence of which has been determined by a court of competent jurisdiction in previous litigation between the same parties. If the cause of action was determined to exist, ie judgment was given upon it, it is said to be merged in the judgment, or, for those who prefer Latin, transit in rem judicatam. If it was determined not to exist, the unsuccessful plaintiff can no longer assert that it does; he is estopped per rem judicatam. This is simply an application of the rule of public policy expressed in the Latin maxim Nemo debet bis vexari pro una et eadem causa. In this application of the maxim causa bears its literal Latin meaning. The second species, which I will call ‘issue estoppel,’ is an extension of the same rule of public policy. There are many causes of action which can only be established by proving that two or more different conditions are fulfilled. Such causes of action involve as many separate issues between the parties as there are conditions to be fulfilled by the plaintiff in order to establish his cause of action; and there may be cases where the fulfilment of an identical condition is a requirement common to two or more different causes of action. If in litigation upon one such cause of action any of such separate issues as to whether a particular condition has been fulfilled is determined by a court of competent jurisdiction, either upon evidence or upon admission by a party to the litigation, neither party can, in subsequent litigation between one another upon any cause of action which depends upon the fulfilment of the identical condition, assert that the condition was fulfilled if the court has in the first litigation determined that it was not, or deny that it was fulfilled if the court in the first litigation determined that it was. It is common ground that four matters have to be established if there is to be an issue estoppel. 1. The issue in question must have been decided by a court or tribunal of competent jurisdiction. It is accepted by the appellant that the Secretary of State, when deciding an appeal under section 18 of the 1961 Act, is a competent tribunal. 2. That the issue must be one which arises between parties who are parties to the decision. This also is accepted. 3. That the issue must have been decided finally and must be of a type to which an issue estoppel can apply. 4. The issue in respect of which the estoppel is said to operate must be the same as that previously decided. These propositions derive from Carl Zeiss Stiftung v Rayner & Keeler Ltd (No 2) [1967] 1 AC 853. It is in relation to points 3 and 4 that the controversy in this appeal arises. The first question therefore is whether the Secretary of State’s decision on the section 18 appeal is one that can give rise to an issue estoppel. In Thrasyvoulou v Secretary of State for the Environment [1990] 2 AC 273* it was held that certain matters decided by the Secretary of State on an appeal against an enforcement notice could give rise to a plea of estoppel per rem judicatam or issue estoppel, but this did not apply, at least so far as estoppel per rem judicatam is concerned, to a decision on the ground that planning permission ought to have been granted for development to which the notice relates. *Editor’s note: Also reported at [1990] 1 EGLR 197 At p287D Lord Bridge of Harwich, with whose speech the other members of the House agreed, dealt with the various grounds under section 88(2) of the Town and Country Planning Act 1971 on which an appeal against an enforcement notice can be based. Ground (a) is that planning permission ought to be granted for the development to which the notice relates. Ground (b) is that the matters alleged in the notice do not constitute a breach of planning control. Ground (c) is that the breach of planning control alleged in the notice has not taken place. Ground (d) applies to notices alleging development by carrying out building etc. operations which can only be enforced against within four years of the development taking place. Ground (d) is therefore established if the breach of planning control occurred more than four years before the issue of the enforcement notice. Ground (e) applies to development consisting of making a material of use of land which can only be enforced against if the change of use was made since 1963. Ground (e) is therefore established if the change of use occurred before the beginning of 1964. The remaining grounds (f) to (h) relate to subsidiary issues which may arise as to the service of the enforcement notice, the steps required to be taken to remedy the breach of planning control alleged and the time for taking those steps and these grounds have no relevance for present purposes. An issue on ground (a) arises in every appeal against an enforcement notice since by section 88B(3) there is deemed to be an application for planning permission for the development to which the notice relates. In determining whether to allow an appeal on that ground the Secretary of State will decide as a matter of policy and in the exercise of discretion whether planning permission should be granted and in relation to ground (a) no question of legal right arises. By contrast the question whether any of the grounds (b) to (e) on which the appellant relies had been established will be answered by applying the relevant rules of planning law to the facts found and the answer will determine in each case an important matter of legal right. This may be simply illustrated by examples. Thus, if an issue is raised on appeal against a notice on ground (b) as to whether or not a building operation to which the notice relates was within the terms of planning permission granted either upon an express application or by the terms of a development order, a decision of that issue to allow the appeal on ground (b) will determine the status of the building in question as having been lawfully erected. He then went on to give examples on the grounds (c) to (e). The reference to the fact that in relation to ground (a) no question of legal right arises must, I think, be a reference to the fact that the applicant for planning permission, or appellant from an enforcement notice, has no legal right to a grant of planning permission, in the event that certain facts are established. This is in contradistinction to a decision of a court of law where as a rule a litigant who establishes certain facts which constitute a cause of action is entitled as a matter of legal right to a decision in his favour. A decision whether or not to grant planning permission is a matter of discretion based upon considerations of policy and aesthetic opinion, as to which opinions may vary. That this is Lord Bridge’s meaning appears from a later passage, where he makes it plain that someone who has been granted planning permission in respect of a piece of land thereby acquires legal rights. At p290E he said: 13 Much of the argument against allowing a plea of res judicata or issue estoppel founded on the determination of an appeal against an enforcement notice under section 88(2) of the Act rested on the proposition that such a determination is characterised by a ‘planning decision’ and emphasis was placed on the rights of members of the public to be heard. Mr Laws submitted that no distinction could be drawn between a decision on ground (a) of section 88(2) to grant or withhold planning permission for the development the subject of an enforcement notice, and the decision of any issue arising under grounds (b) to (e). If an estoppel arises in the one case, he submits, it must equally arise in the other. I cannot accept this submission. A decision to grant planning permission creates, of course, the rights which such a grant confers. But a decision to withhold planning permission resolves no issue of legal right whatever. It is no more than a decision that in existing circumstances and in the light of existing planning policies the development in question is not one which it would be appropriate to permit. Consequently, in my view, such a decision cannot give rise to an estoppel per rem judicatam. I also think that there is a significant distinction between the issue raised by an appeal under ground (a) and the issues raised by any of grounds (b) to (e) in that members of the public have the right to attend any public inquiry and to be heard as objectors against the grant of planning permission, but can have no locus standi as objectors, although they may be heard as witnesses of fact, in relation to the issues raised on grounds (b) to (e). Basing himself on the reasoning of Lord Bridge, Mr Michael Barnes QC, on behalf of the appellant, submitted that a decision by the Secretary of State under section 18 of the 1961 Act as to whether or not planning permission would have been granted in a hypothetical situation is of a similar nature to a decision whether it should be granted in an actual situation, involving similar questions of discretion, policy and opinion, and accordingly could not give rise to an estoppel. Mr Spence sought to distinguish the two, first on the basis that the section 18 decision is a hypothetical rather than an actual one. But I cannot see that this is a relevant distinction. Second, on the basis that in a section 18 case the public have no participation, unlike an appeal on a planning application or against an enforcement notice. This is the point made by Lord Bridge at the end of his second paragraph quoted. This is a distinction; but it is only one of the reasons given by Lord Bridge and does not affect principal ground. Mr Spence accepts, as I understand it, that a nil certificate would not estop the respondents from contesting before the Lands Tribunal that planning permission would have been granted on the retained land. This he suggests is the effect of section 14(3) and (3A) of the 1961 Act; though the Lands Tribunal is required to have regard to the contrary opinion expressed in the nil certificate. But both section 15(5) and section 14(3) and (3A) are only concerned with the compulsorily acquired land and do not affect the retained land. In my judgment, it would be remarkable if an estoppel per rem judicatam could be created by a positive certificate but not by a nil certificate. But Mr Spence’s secondary submission, and one I think on which he places most reliance, is that even if the decision itself that planning permissions would have been granted up to the green route does not create an estoppel per rem judicatam for the reasons given by Lord Bridge, findings of fact made by the inspector and adopted by the Secretary of State, which were a necessary part of the reasoning which led to the grant of the certificate, nevertheless can give rise to an issue estoppel. Mr Spence cited no authority for this proposition, though he submitted that it was based on general principle. He relied upon a dictum of Lord Shaw of Dumfermline in Hoystead v Commissioner of Taxation [1926] AC 155 at p170 where he said: It is seen from this citation of authority that if in any Court of competent jurisdiction a decision is reached, a party is estopped from questioning it in a new legal proceeding. But the principle also extends to any point, whether of assumption or admission, which was in substance the ratio of and fundamental to the decision This passage was cited with approval by Lord Reid in the Carl Zeiss case at p915G. Mr Spence also referred to two passages from the judgments of the Court of Appeal in Fidelitas Shipping Co Ltd v V/O Exportchleb [1966] 1 QB 630. Lord Denning MR said at p640: The rule then is that, once an issue has been raised and distinctly determined between the parties, then, as a general rule, neither party can be allowed to fight that issue all over again. Diplock LJ at p641 said: The final resolution of a dispute between parties as to their respective legal rights or duties may involve the determination of a number of different ‘issues’, that is to say, a number of decisions as to the legal consequences of particular facts, each of which decisions constitutes a necessary step in determining what are the legal rights and duties of the parties resulting from the totality of the facts. These passages are quoted by Lord Wilberforce in Carl Zeiss at p964. But these were cases where the original decision was one capable of creating an estoppel per rem judicatam or cause of action estoppel, because they were decisions of a court determining the legal rights of the parties by applying the law to the facts found. It is entirely understandable that an issue estoppel can arise from such a decision. They do not lend any support to the contention that where the decision is not such as to create an estoppel per rem judicatam, the lesser creature, issue estoppel can nevertheless arise. Such a conclusion seems to me to be inconsistent with the reasoning of Lord Bridge in Thrasyvoulou. At the beginning of his speech he posed the question thus at p285: My Lords, these two appeals raise the question whether a decision of the Secretary of State allowing an appeal against an enforcement notice on one of the grounds in paragraphs (b) to (e) of section 88(2) of the Town and Country Planning Act 1971, as amended by the Local Government and Planning (Amendment) Act 1981, is capable of giving rise to an estoppel per rem judicatam or to an issue estoppel. If Lord Bridge had thought that even though a decision whether or not to grant planning permission was not one to which estoppel per rem judicatam could apply, it was possible for an issue estoppel to arise in relation to some finding of fact made by the Secretary of State and necessary to his decision, I find it very surprising that he did not say so. It seems to be implicit in his judgment that he thought no such thing. In fact as Diplock LJ made clear in the passage I have cited from Thoday v Thoday, estoppel per rem judicatam embraces both cause of action estoppel and issue estoppel. Since Lord Bridge cited this passage, it seems to me clear that in holding that a decision on ground (a) of section 88(2) cannot give rise to estoppel per rem judicatam, he must be taken to have included in this issue estoppel. Mr Spence sought to gain some support from a dictum of Ralph Gibson LJ in the Court of Appeal in the Thrasyvoulou v Secretary of State for the Environment [1988] 1 QB 809* at p824A he said: *Editor’s note: Also reported at [1988] 1 EGLR 192 It is necessary now to consider whether issue estoppel can arise out of the decision by the Secretary of State or an inspector upon a section 36 appeal. In my judgment issue estoppel can so arise if the party seeking to raise it proves that the earlier decision in the section 36 appeal was given in his favour against the planning authority upon an issue as to his existing rights of use of the property, and was a decision of the same issue as that raised in the new proceedings. A section 36 appeal is simply an appeal from the refusal of planning permission by the local planning authority, and raises identical issues to those in an appeal against an enforcement notice under section 88(2). But I do not understand this passage to differ in any way from what Lord Bridge said in the House of Lords. It relates to grounds other than the question whether or not planning permission should be granted and is made clear in the next paragraph of his judgment. Moreover, I think there is force in Mr Barnes’ submission that it would be remarkable if, although no estoppel per rem judicatam could arise on a section 17 certificate, whether positive or negative (and Mr Spence concedes there cannot be in relation to a nil certificate), there 14 were to be an issue estoppel in relation to a finding of fact upon which the section 17 certificate is largely based. There is I think an additional reason why a decision of the Secretary of State whether to grant planning permission, whether on an appeal from an enforcement notice or original refusal by the local authority, cannot give rise to estoppel per rem judicatam, either in the form of cause of action or issue estoppel, and that is because it lacks the necessary element of finality. It is well established that a judgment pending trial, such as whether or not to grant an interlocutory injunction, cannot give rise to an estoppel of either sort, because it lacks this element of finality. As Lord Bridge pointed out in Thrasyvoulou a refusal of planning permission does not finally determine the matter; a fresh application can be made. Moreover, although a grant of planning permission can create rights and if acted upon cannot be revoked, if it is allowed to lapse determines nothing. In my judgment, Mr Barnes is correct on the first question and the decision of the Secretary of State on a section 18 appeal cannot give rise either to estoppel per rem judicatam or an issue estoppel. I turn to consider the second question, namely whether the issue determined by the Secretary of State is the same as that which has to be determined by the Lands Tribunal. Mr Barnes submits that it is not. What the Lands Tribunal has to assess is the diminution in value, if any, to the land of the respondents retained by them. Consideration of the open market value of a piece of land will involve an assessment of the chances of planning permission being granted for it, together with such questions as the demand for such development. The assessment of the prospect of planning permission no doubt depends to a large extent on where an alternative bypass would have gone if it had not followed the yellow route. To this extent the questions before the Lands Tribunal and the Secretary of State are similar; but, in my view, they are not the same. The point can best be illustrated by taking an example where the facts may be somewhat different from those which in fact existed. Suppose there were two alternative routes to the route chosen, one to the east of it and one to the west. The two alternatives might be very evenly balanced. But the Secretary of State might decide that the scales just tipped in favour of the eastern route, with the result that he concludes that planning permission would have been granted up to that alternative route and this would include the claimants’ land. Because of the assumptions required to be made in relation to the acquired land, this finding is the equivalent of a certainty that planning permission would be granted in relation to that land. Mr Spence also submits that the finding as to the position of the alternative route must also be regarded as a certainty, because he says it is a finding of hypothetical fact. It is only necessary for the Secretary of State to find the position of the alternative on a balance of probability; but the Lands Tribunal have to assess the extent of the chance, which in the example given is only just better than even. Where a court or tribunal has to decide what would have happened in a hypothetical situation which does not exist, it usually has to approach the matter on the basis of assessing what were the chances or prospect of it happening. The chance may be almost a certainty at one end to a mere speculative hope at the other. The value will depend on how good this chance is. Where however the court or tribunal has to decide what in fact has happened as an historical fact it does so on balance of probability; and once it decides that it is more probable than not, then the fact is found and is established as a certainty. This distinction is well illustrated by the case of Davies v Taylor [1974] AC 207 and Allied Maples Group Ltd v Simmons & Simmons [1995] 1 WLR 1602, CA. It would be unnecessary for the Secretary of State to evaluate the chance of the eastern route being the preferred alternative route in the event that the actual route was not chosen, provided it was more than 50%; but the Lands Tribunal would be concerned in assessing value to evaluate the chances of this happening more precisely. It may well be that on the facts of this case the only viable alternative was the green route and other alternatives can be completely discounted. I do not know. But a question of principle cannot be determined on the basis of favourable facts of a particular case, and for this reason also I am of the opinion that the Secretary of State’s decision did not create an issue estoppel. I would allow this appeal and answer the question posed in para 4 of the case stated, namely whether the Lands Tribunal erred in law in rejecting the acquiring authority’s submission that no issue estoppel was created in favour of the claimants in the alternative. Agreeing, Peter Gibson LJ said: There is much that is common ground between the parties. Of the four conditions for there to be an issue estoppel, which Stuart-Smith LJ has set out in his judgment, only the satisfaction of part of the third condition, viz that the issue in question must be of a type to which an issue estoppel can apply, and the fourth condition, viz that the issue, in respect of which the estoppel is said to operate, must be the same as that previously decided, is now contested by the acquiring authority. It is right to point out at the outset that, as Mr Spence QC for the claimants emphasised, they do not rely on the certificate under section 17 Land Compensation Act 1961 itself, which was directed by the Secretary of State on the appeal to him under section 18, for the issue estoppel asserted by the claimants; they merely rely on one issue of hypothetical fact underlying the certificate. That fact is that there would have been an alternative bypass to the east along the line of the preferred route in the absence of the actual bypass. There is no doubt but that the issue whether there would have been such an alternative bypass on that line was an issue that was distinctly raised by the claimants and determined by the Secretary of State in the course of arriving at his decision to issue the section 17 certificate. The first question is therefore, in my view, more accurately stated as whether the determination by the Secretary of State of an issue of hypothetical fact in reaching his decision under section 18 is one to which an issue estoppel can apply. Mr Barnes QC for the acquiring authority submitted that the Secretary of State had to reach a decision whether in his opinion planning permission would have been granted for a form of development on the land acquired if it were not being acquired compulsorily, and that in essence was the decision the Secretary of State makes on any planning appeal, including an appeal on ground (a) of section 88(2) Town and Country Planning Act 1971. He relied on what Lord Bridge said in Thrasyvoulou v Secretary of State for the Environment [1990] 2 AC 273 at pp287 and 290 as authority for the proposition that the decision of the Secretary of State in the section 18 appeal is one of a nature and category which cannot give rise to an estoppel per rem judicatam. If that proposition were limited to the decision whether to direct the issue of a section 17 certificate, I would accept it. Mr Barnes submitted that if the genus of estoppel per rem judicatam does not apply to a decision, it would be absurd to hold that one species of that genus, issue estoppel, can apply to the same decision. Put that way, his submission is a mere truism which does not help to resolve the real question. Issue estoppel, as distinct from cause of action estoppel, will arise where cause of action estoppel cannot be established but nevertheless there has been a final determination of a precise point distinctly put in issue and the contrary of the same point is sought to be raised in subsequent proceedings between the same parties. I cannot see why in principle an issue estoppel in respect of the determination of such a point may not arise in the course of proceedings culminating in a decision which itself cannot be the subject of an estoppel. It is said that Lord Bridge’s speech in Thrasyvoulou is inconsistent with the possibility of an issue estoppel arising in such circumstances. I am unable to agree. The observations of Lord Bridge on ground (a) of section 88(2), and the reasons why he distinguished that ground from grounds (b) to (e), were directed to the decision of the Secretary of State as to whether planning permission should be granted. As he said (at p289), that decision will be reached ‘as a matter of policy and in the exercise of discretion’ and (at p290) ‘It is no more than a decision that in existing circumstances and in the light of existing planning policies the development in question is not one which it would be appropriate to permit’. None of that reasoning is pertinent to the determination of a point of fact, actual or hypothetical, that determination not being dependent on policy or discretion. I would add that in that part of Lord Bridge’s speech where he considers ground (a) of section 88(2), he uses the terms ‘estoppel per rem judicatam’ and ‘issue estoppel’ indifferently (see p295) but goes on to distinguish between them by reference to the terminology used by Diplock LJ in Thoday v Thoday [1964] P 181 at pp197–8. Thus applying that terminology and classification by analogy to the issues which arise on an appeal against an enforcement notice on any of grounds (b) to (e) of section 88(2), he thought the analogue of a cause of action estoppel would arise whenever the determination of the ground decided in favour of the appellant on an appeal against an enforcement notice could be relied on in an appeal against a second enforcement notice in the same terms and directed against the same development as the first. But he contrasted that with the issue estoppel that arose on the appeal in Oliver v Secretary of State for the Environment, (decided at the same time as the Thrasyvoulou appeal) where there was a determination of an issue of fact (as to an established use) which Lord Bridge described as an essential foundation for the finding of an inspector, which issue could not be raised in subsequent proceedings. I cannot see why the determination of an issue of fact which was an essential foundation for the decision of the Secretary of State on an appeal under ground (a) should not similarly give rise to an issue estoppel. It is not suggested that an issue of hypothetical fact should be treated differently from an issue of actual fact. Accordingly, I would hold on the first question that the determination by the Secretary of State of an issue of hypothetical fact in reaching his decision under section 18 is one to which an issue estoppel can apply. That leaves the second question: is the issue of whether there would have been an alternative bypass on the line of the preferred route the same as that to be determined by the Lands Tribunal? For the reasons given by Stuart-Smith LJ I agree with him that it is very similar but that it is not the same. I, too, would allow the appeal and answer the question in para 4 of the case stated in the manner proposed by Stuart-Smith LJ Also agreeing, Thorpe LJ said: The result for which the land owners contended in the Lands Tribunal has obvious practical attractions. If by an expensive appellate procedure the Secretary of State has pronounced what would have happened had the yellow route not been selected, the proposition that the same hypothetical question of fact should be reinvestigated in subsequent proceedings between the same parties is obviously unattractive. Therefore the decision of the president of the Lands Tribunal is hardly surprising and I would have favoured upholding it had authority permitted. However, Mr Barnes swiftly demonstrated that authority does not permit, and Mr Spence’s manful efforts to turn the attack were, in my judgment, unavailing. For me the case of Thrasyvoulou v Secretary of State for the Environment [1990] 2 AC 273 is determinative. Although the speech of Lord Bridge does not expressly state that issue estoppel cannot underlie a decision to which estoppel per rem judicatam cannot apply, I share the view of Stuart-Smith LJ, that that is the effect of his judgment by implication. Thus I accept Mr Barnes’ submissions on both issues and agree that this appeal should be allowed. Appeal allowed.