What Is A Compulsory Purchase Order?
Posted on 19th August 2020
Our Property Conveyancing Solicitors have often come across the term “Compulsory Purchase Order”, however, most of our clients will not have heard the term. Therefore, in today’s blog, our expert team will explain what this term means and what it could mean for your property sale or purchase if you are looking at buying a property that this would affect.
What is a Compulsory Purchase Order?
A Compulsory Purchase Order is when certain organisations, such as a government, local Council or a utility company, have a Statutory Right to buy your property or take a right over it. A Statutory Right means a right granted under the law. To be able to exercise such a right, the body or organisation much meet specific criteria, again set out in the law, and they must prove that the purchase would be in the public interest.
Who can apply for a Compulsory Purchase Order?
As our Property Conveyancing Solicitors have explained above, the most common bodies who apply for this type of Order would include government departments, water or electric companies or a local council. They would be known as the Applicants.
When does a Compulsory Purchase Order take effect?
Until a Compulsory Purchase Order is granted, after the necessary steps have been taken, the Applicants do not have the power to take over or acquire your land.
Before taking any legal steps by making an application, the Applicants are encouraged to discuss acquiring the land directly with the owner. Therefore, only if an agreement cannot be reached should a body or organisation move forward with an application for a Compulsory Purchase Order.
What should I do if a Compulsory Purchase Order has been commenced?
If you believe that an organisation has applied for a Compulsory Purchase Order in relation to your property or land, you should keep a detailed log of any events that take place, along with details and receipts for any expenses incurred due to the process.
You can also contact the Local Authority, who could provide you with more information about the proposed Order.
Before any organisation commences an application for a Compulsory Purchase Order, they will most likely need to know information about the land. They will usually undertake what is known as a feasibility study. They will investigate the local area, the amount of land needed, the boundaries of the land, the gradient and the surrounding area.
At this point, the organisation will usually contact you, especially if they want to physically visit the land to determine if the area is suitable for their requirements.
Will I get an option to sell my land first?
Before any application is made for a Compulsory Purchase Order, the potential applicants should discuss the intended purchase with the current owner. You may receive a notice requesting more information about the land, and whether any other parties have an interest. At this stage, failure to provide the requested information could be a criminal offence.
If you have been served with a notice, you should seek legal advice from qualified Property Conveyancing Solicitors to ascertain what you need to do.
When your property is subject to a Compulsory Purchase Order, if you know what you are doing, you may be able to negotiate better terms or even stop the acquiring authority from securing powers to force you to sell.
What is included in the application for a Compulsory Purchase Order?
Once all the necessary information has been collected and collated, and if negotiations with the owners of the land were unsuccessful, the organisation will prepare the application. This will contain a plan of the land to be acquired, the owner’s details, details of third parties who have an interest, as well as details of those parties who may wish to make an application for compensation. The application will also include a Statement of Reasons for the Order, setting out why the Order should be made.
What happens next?
A notice must be served on every person potentially affected by the Compulsory Purchase Order, specifying how to make objections and the timeframe for making these. The organisation may also be required to place a press release in a local paper, usually for a minimum of two weeks, notifying the public of the application.
If any objections are received to the Order, a hearing may be required to discuss these in person. Alternatively, written representations may be accepted. This should be held within 22 weeks of the Minister hearing the matter and notifying the relevant parties.
Once the hearing has been completed, if required, the appointed Minister will decide whether to accept, reject or change the Compulsory Purchase Order, providing reasons for their decision.
Will I receive compensation if my land is purchased?
If your land is purchased under a Compulsory Purchase Order, you should usually be entitled to compensation. This is based on the principle that you should not be left out of pocket financially after the acquisition is made by the organisation.
Should I seek legal advice?
Yes. If you have been offered compensation relating to a Compulsory Purchase Order, you should seek legal advice as soon as you can, and definitely before accepting any offer.
The Government website offers some useful assistance in relation to these Orders, which you can read about, here.
The law surrounding Compulsory Purchase Orders can be very complex, and you should definitely seek legal advice before attempting to navigate these situations yourself. If you do not, and you accept an offer without advice, even if you discover further loses in the future, you may not be able to claim these at a later date.
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