The following cases are referred to in this decision:

Potter v London Borough of Hillingdon [2010] UKUT 212 (LC)

Greenweb v Wandsworth LBC [2008] EWCA Civ 910, [2009] 1 WLR 612

The following further cases were cited in argument:

Pointe Gourde Quarrying & Transport Co Ltd v Sub-Intendent of Crown Lands [1947] AC 565

Transport for London v Spirerose Ltd (in administration) [2009] UKHL 44, [2009] 1 WLR 1797

Stokes v Cambridge Corporation (1961) 13 P & CR 77

DECISION

Introduction

1. This is a reference to determine the amount of compensation payable to Mrs Sheila Grace Hall (“the claimant”) following the compulsory acquisition of Rose Cottages Scrap Yard, Moor Lane, Harmondsworth UB7 0AS (“the reference land”) by London Borough of Hillingdon (“LBH” or “the acquiring authority”) pursuant to the London Borough of Hillingdon (Harmondsworth Moor) Compulsory Purchase Order 2003 (“the CPO”).

2. Mr Rana Bains, a former solicitor and the claimant’s authorised agent, appeared for the claimant. He called Mr John Douglas Thurlbeck who had provided a witness statement of fact. Following an application made just before the commencement of the hearing, and having heard submissions from both parties, we admitted witness statements and oral evidence from Messrs Anthony Edward Hall and Nicholas Mark Hall (the claimant’s husband and son respectively), also as witnesses of fact. For reasons explained in more detail below, and against the background of previous procedural directions made in this reference, we took the view that there had been no good reason for the significant and serious delay on the part of the claimant in applying to adduce this late evidence, but that the overriding objective of dealing with this case fairly and justly required us to admit the further evidence in order to enable the claimant to participate fully in the proceedings. We considered that any prejudice to LBH caused by its late production could be addressed in our evaluation of the further evidence.

3. However, we would not wish our late acceptance of the further evidence in this case to serve as any encouragement to parties in other cases to follow a similar course to that taken by the claimant. We remind parties that they are required by the procedural rules which govern proceedings in this Tribunal to help it to further the overriding objective and to co-operate with the Tribunal generally. In part as a result of the time taken to address this issue at the commencement of the hearing, there was insufficient time to conclude this matter by way of oral submissions within the time allotted to it, and we therefore had to call for written submissions to be lodged sequentially after the conclusion of the hearing. The claimant called no expert evidence in support of her claim.

4. Mr Richard Langham (of counsel) appeared for LBH and called Mr Dennis Pope MRTPI of Nathaniel Lichfield & Partners who gave expert planning evidence and Mr Kirk Macdiarmid MRICS of Savills who gave expert valuation evidence. We carried out an accompanied inspection of the reference land, the surrounding area, and four further sites relied upon as comparables in good weather on Monday 26 October 2015.

The claim

5. Under the claimant’s principal case compensation for the value of the reference land should be assessed on the basis of a 50/50 split of the value of the planning gain enjoyed by British Airways Plc (“BA”), the developer of its new headquarter offices and park land in the surrounding area, such sum to be “agreed at a later date and, if not agreed, to be referred back to the Upper Tribunal for a further determination”. We describe that as the “ransom value argument”. If that basis is not accepted, the claim on the first alternative basis is quantified at £4 million - that being the “hope value argument” - on the assumption that planning consent for residential or other development would be forthcoming at the valuation date. The second alternative values compensation on the basis of the existing use value of the land at £3 million. It was submitted for the claimant that if the first two valuation bases were to be rejected by the Tribunal, and the value of the land was to be determined on its existing use value, then there is also a claim for disturbance amounting to £303,585 relating to removal charges and loss of value of stock that “had to be given away in order to clear the reference land”. The claimant also seeks the recovery of her legal and professional fees and statutory interest.

6. The acquiring authority maintained that the land on the relevant date had no ransom or hope value, and compensation should be determined at £300,000 on the basis of its existing use value as a scrap yard. Disturbance compensation should amount to no more than £5,000. By the time he presented LBH’s closing submissions, and following some concessions made by Mr Macdiarmid in cross-examination, Mr Langham invited the Tribunal to award £450,000 (less a discount of up to 20%) for the land taken with the figure for disturbance remaining at £5,000.

Factual Background

7. Inevitably in a reference where the evidence and submissions of the parties have ranged widely there will be particular points (both factual and legal) which we do not consider to be material to our determination of this case. One such point is the precise level of contamination and costs of remediation of the reference land. The mere fact that we do not mention a particular matter, particularly in our summary of the parties’ respective cases, does not mean that we have overlooked it or that it has not been considered in the course of our deliberations. To mention every single point, however immaterial or of marginal relevance, would have rendered this decision indigestible.

8. A draft statement of facts and issues was prepared by the acquiring authority, but it was not agreed between the parties. However, that document served as useful background information and from this, together with the parties’ statements of case, the witness statements and the evidence of Messrs Anthony and Nicholas Hall and Mr Thurlbeck, LBH’s expert witness evidence and our inspection of the reference land, we find the following facts. We should also say here that the facts found in the Upper Tribunal’s decision in Potter v London Borough of Hillingdon [2010] UKUT 212 (LC) (the “Potter case”), which was relied upon by LBH and also referred to extensively by the claimant, have been of further assistance to us.

9. The reference land comprises a level, rectangular site of 0.31 ha (0.76 acres) lying on the south side of Moor Lane to the east of Harmondsworth village, and at the valuation date it was lawfully operated by the claimant (who was the sole freehold owner), her husband and other members of the Hall family, as a scrap yard. It was acquired by LBH pursuant to the CPO which was made on 29 January 2003 and confirmed (with modifications) by the Secretary of State on 11 February 2005. The stated purpose of the CPO was “achieving the proper planning of an area in which the land is situated by the provision of a public park”. The general vesting declaration was dated 25 June 2008 and the agreed valuation date is therefore 23 July 2008. (The valuation date in the Potter case was 6 June 2007). LBH did not however take physical possession of the reference land until 16 December 2009 and the claimant remained in occupation until then. On 18 December 2009 LBH transferred it to BA for a nominal consideration of £1. The price of the reference land reported to the Land Registry at the time (presumably by BA’s solicitors) was £356,375. We accept the evidence of Mr Macdiarmid that this was a combination of his assessment at the time of the value of the land (£300,000) and an appropriate award for disturbance (£56,375).

10. There is a substantial history to the compulsory acquisition and the compensation claim in respect of the Potter land which was set out in full in the Upper Tribunal (Lands Chamber) decision in the Potter case, to which reference should be made for the full factual background. Suffice to say here that the CPO was connected with a proposal by BA (for which it was granted outline planning permission on appeal in 1992) for “a Corporate Business Centre (5.1 hectares), landscaping, new access and car parking, public parkland and community and leisure sports facilities on land known as Prospect Park to the west and north of Harmondsworth...” That permission was subject to some 35 conditions and what is referred to as the first section 106 Agreement dated 6 January 1992.

11. Two principal distinguishing features of the present case are that, unlike the land in the Potter case, the reference land (1) had, at all material times before possession was taken (and thus at the valuation date), an established use as a scrap yard in the Green Belt and (2) BA was not required to incorporate the reference land into the public park. Under the terms of a second, replacement, s106 agreement entered into on 13 April 1995 (“the 2^nd s.106 agreement”) which rescinded the first one, BA was obliged to use “reasonable endeavours” before 31 December 2000 to seek to acquire the freehold ownership of four remaining areas of land (including the reference land and the Potter land): see cl 6.18. Should the acquiring authority, in its absolute discretion, choose to acquire any of the remaining areas by CPO (which in the event it did), BA was required to accept the transfer of such land and to reimburse the acquiring authority for any compensation payable: see cl 6.19. By cl 6.21, if BA acquired freehold ownership of the reference land, it covenanted “not to use or permit the continued use of this land for open storage or as a scrap yard or for commercial or industrial purposes and [BA] will improve the appearance of the [reference land] so that it is compatible with the appearance of the New Park Land after completion of the Landscaping Works PROVIDED THAT [BA] may carry out development on the [reference land] pursuant to a planning permission granted after the date of this Agreement notwithstanding that the implementation of the development will affect the appearance of the [reference land].” By cl 4.2 and 4.3 this covenant was binding upon, and enforceable by LBH against, BA’s successors in title to the reference land.

The claimant’s case in support of her claim

12. The claimant complains that the acquiring authority and BA have caused many painful years of delay in relation to the reference land by making it virtually impossible for her to obtain reliable professional representation. She asserts that she has had to advance her case without a valuation expert and without access to important relevant information which the acquiring authority holds and which it ought to have made available to her. The claimant believes that she has been mistreated by LBH, which has preferred BA’s interests over her own to her detriment. Mr Bains submits that the expert evidence tendered by the acquiring authority is biased, based on conflicts of interest, incomplete and unsafe. He took a preliminary objection to the admissibility of Mr Pope’s expert evidence on the grounds that he had allowed his overriding duty as an expert witness to the Tribunal to be compromised by his continuing role as a planning consultant to BA. He supported that by submitting that important matters had been overlooked or misstated in his report. We rejected Mr Bains’s objection to the impartiality and independence of Mr Pope’s report and accepted his report in evidence (subject to cross-examination and our own assessment of the weight to be attached to it).

13. Mr Bains accepts the relevance of the Potter land to this reference but he points out that each case has to be decided on its own facts; and he submits that there is a fundamental difference in approach between the Potter land and the reference land. He also points to the Potters’ lack of legal representation and their failure to draw attention to the fact that BA had already completed and entered into occupation of its office development well before the relevant CPO was even made. In the case of the Potter land, the 2^nd s.106 agreement required BA to spend money to lay the land out as a park and thereafter maintain it but in the case of the reference land BA was required to cease the existing use as a scrap yard although it could carry out a development which was compatible with the park. Given that the properties on either side of the reference land (Scotch Lake Farm to the east and Cambridge Lodge to the west) have an established residential use, it is said that it can safely be assumed that a residential use on the reference land would have been perfectly compatible with the park and, as an infill site, such a use would probably have been welcomed by a planning authority. Both of the acquiring authority’s experts have, Mr Bains pointed out, overlooked mentioning this important fact which would have had significant effects on the value of the reference land. The land has been transferred by LBH to BA which can hold it as part of its“land bank”.

14. Mr Bains submits that in the Potter case (at [89]) the Tribunal had recognised BA as a “special purchaser”. He argues that the reference land had been an essential consideration in securing planning consent for BA’s coveted office development scheme to be implemented in the Green Belt and it would therefore have been prepared to pay whatever was necessary to secure the reference land. The cessation of the undesirable scrap yard use of the reference land had been seen as a sufficiently valuable benefit to justify granting planning permission for BA’s office development in the Green Belt. The special importance of the reference land to BA’s entire scheme had been of crucial and fundamental significance since 1992; and in the 2^nd s.106 agreement BA had undertaken to underwrite the cost of its acquisition by LBH without any limitation. Indeed, Mr Bains describes the reference land as “the very last piece of the jigsaw for BA’s development”. BA was a special purchaser because the reference land was of the utmost importance to BA as it would enable it finally to sign off its outstanding obligations under the 2^nd s.106 agreement and release the value of its development. In any event, the acquiring authority should be estopped from denying the importance of the reference land to the scheme. The claimant asks the Tribunal to find that she is entitled to compensation based upon a ransom value 50/50 split of the planning gain enjoyed by BA (which LBH’s valuation expert was said to have agreed was the correct split in the Potter case) and in accordance with the principles in Stokes v Cambridge Corporation (1961) 13 P & CR 77, with the figures to be agreed at a later date and, if not agreed, to be referred back to the Tribunal for a further determination.

15. The claimant’s first alternative claim is for the hope value of the reference land as development land in the sum of £4 million. There was undisputed evidence that six terraced cottages on the reference land had been demolished in the mid-1950s pursuant to a slum clearance scheme. An OS Map for 1935 annexed to the claimant’s Statement of Case (at Bundle 1/A/27) shows the cottages and there is a poor quality copy photograph of them at Bundle 1/A/29. Mr Bains submits that pursuant to Land Compensation Act 1961 s.15(3) planning permission may be assumed for the rebuilding of those cottages when arriving at the “existing use” value. He relies on the Court of Appeal authority of Greenweb v Wandsworth LBC [2008] EWCA Civ 910, [2009] 1 WLR 612; and he points out that neither of LBH’s experts refers to this assumption at all.

16. Mr Bains submits that the lawful use of the reference land as a scrap yard means that the local planning authority would have considered granting planning permission for a use that was compatible with the two adjoining properties, one of which (Cambridge Lodge to the west) was residential and the other (Scotch Lane Farm to the east) was part residential and part commercial. Those uses, together with the industrial use at Saxon Way Industrial Estate (to the north-west), were viewed as compatible with the use of the park that was created to the rear of and opposite to the reference land. Mr Bains submits that the local planning authority would have been quite flexible and willing to grant permission for many other types of development which were more “neighbour friendly” than a scrap metal yard. Regardless of the fact that the reference land was in the Green Belt, it is said that its existing “bad neighbour” use meant that the local planning authority would have accepted any development that caused a lesser environmental impact, as there were very special circumstances applicable to the reference land. That is said to have made the reference land extremely valuable.

17. In assessing its open market value as at the valuation date, it is said to be reasonable to assume that the hypothetical purchaser would take account both of the existing open storage/scrap yard use and also of the prospect of obtaining planning consent for some other use compatible with the appearance of the park, including residential use. BA was a special purchaser by reason of its ownership of Cambridge Lodge immediately to the west of the reference land. That has been allowed to fall into a derelict state (as we were able to observe during our site view). If combined with the reference land, it would form a development site of approximately 1.8 acres with access to both Moor Lane and Accommodation Lane and with potential for residential, office, light industrial or commercial car park use. Whether in conjunction with Cambridge Lodge or Scotch Lake Farm, a substantial residential development would have been perfectly feasible; and the location of the reference land, opposite the lake, surrounded by park land and in the Green Belt, would make it a desirable and profitable development. Mr Macdiarmid was said to have over-estimated the costs and under-stated the potential profits of any development of the reference land. In cross-examination it was put to him that there were many relevant differences between his suggested comparables and the reference site, and that he had not made appropriate allowances to reflect those differences

18. The claimant’s second alternative claim is for the existing use value of the reference land based on its use as a scrap yard which is put at £3 million. In support of this claim, the claimant emphasises that the reference land is outside the conservation area and has been lawfully used as a licensed scrap yard by her and members of her family since about 1961. She says that it has never been used as a car breakers’ yard (which would have given cause for concern about possible land contamination). Mr Bains argues that there were no genuine concerns that the reference land might be contaminated, as demonstrated by the absence of any reference to the need for tests, reports or remediation works in the 2^nd s.106 agreement. The claimant points out that there is unrestricted access with or without vehicles via Moor Lane through Harmondsworth Village and then over a single lane bridge which (as we observed) is subject to no weight restriction. The reference land is said to have been fenced and secure at the valuation date. It had a compacted hardcore road and paths running through it allowing heavy vehicles to enter and leave the land without getting stuck. There was no significant contamination. There were three caravans on site for occupation by site workers and a small port-a-cabin which was used as a site office and was connected to mains water, electricity and telephone.

19. The claimant also relies upon offers made for the land by BA and LBH in the 1990s, over 10 years before the valuation date. On 8 April 1994, Rogers Chapman (BA’s then appointed agents) wrote to Mr Hall confirming that BA was willing to offer him £450,000 for the reference land. This offer was said to be “based on prevailing market values for land in the airport area” and cited two comparable transactions in support of the offer. It should be noted that at this time the operative s.106 agreement was the first (dated 6 January 1992) which required BA to use its “best endeavours” to acquire the reference land. On 1 August 1997 Rogers Chapman made a final offer to Mr Hall on behalf of BA to acquire the reference land for £450,000. The letter stated that: “An independent Report and Valuation was carried out stating that the current market value of your property is £350,000.” The letter referred to BA’s obligation under cl 6.18 of the 2^nd s.106 Agreement to use “reasonable endeavours” to seek to acquire the freehold of the reference land before 31 December 2000 and stated that “in the interests of bringing about an amicable solution” BA was prepared to submit a final offer of £450,000. That offer was repeated in a chasing letter dated 8 September 1997. By a letter dated 25 March 1998 LBH confirmed to Mr Anthony Hall that the council’s Policy Committee had resolved on 23 January 1998 to “seek to acquire your property by use of its Compulsory Purchase powers” and made a pre-CPO offer of £350,000 to settle the compensation for the reference land. Mr Bains submits that since Rogers Chapman were rightly trying to get the best deal for their client, the prevailing open market value would, if anything, have been higher, not lower, than what was offered. Given what had happened to property prices in the intervening 14 year period between 1994 and the valuation date in 2008, the acquiring authority’s current assessment of the market value of the reference land at the valuation date is said to be “grossly misaligned”.

20. By reference to increases in the House Price index, £450,000 as at April 1994 is now said to be worth some £1.77 million. Sites with planning permission for scrap yard use are said to have been “extremely rare” in 1989 (when BA offered to take an option on the reference land for £800,000) and are even more so now. The market is said to be prepared to pay a premium because of the scarcity value. That is why the offer of an option was rejected as inadequate. Assuming that an option would have been exercised for £800,000 before August 1992, that figure would have risen to some £3.09 million by the valuation date. This forms the basis of the claim for £3 million on an existing use basis, exclusive of disturbance, professional costs and interest. The claimant also relies, by way of cross-check, upon the sale of 45 Holloway Lane, Harmondsworth for some £632,000 as at 6 January 2011 (which is said to be equivalent to almost £643,000 at the valuation date). Allowing for the fact that this site (which remains undeveloped) is less than half the size of the reference land, and adjusting for its triangular shape and the fact that it is said not to be located in such a desirable spot as the reference land in terms of road noise, lack of parking and outlook, the claimant submits that this comparable would produce a value for the reference land at the valuation date of £1.8 million.

21. If the reference land falls to be valued on an existing use basis, there is also a claim for compensation for disturbance. Although the vesting date was 23 July 2008, the claimant was allowed to remain in occupation of the site after that date. No possession notice was served until 26 October 2009 and the claimant was then only given one month to clear the site (although, in the event, she was allowed until 16 December 2009 to do so). As a result, it is said that the claimant had to give away stock to an estimated value of some £203,586 (as detailed in the evidence of Mr Nicholas Hall) in order to avoid LBH levying an excessive charge for clearing the site and storage charges. She claims this sum, together with a further £100,000 for the cost of removing the stock that was moved to an alternative, and temporary, site.

The acquiring authority’s case in response

22. Mr Langham rejects the imputations against the integrity of the acquiring authority’s expert witnesses and the allegations against the acquiring authority itself. He points out that Messrs Pope and Macdiarmid are the only experts the Tribunal has heard on matters of planning and valuation respectively. He submits that it would not be proper to attach weight to the testimony of Mr Anthony Hall (or his son) in relation to the valuation of scrap yard sites or whether other sites are, for valuation purposes, comparable sites. He makes the further point that if the claimant had produced experts’ reports by the January deadline, as she should have done, a meeting between the rival experts would have followed. At this Messrs Pope and Macdiarmid would have discussed points raised by the claimant’s experts. These would presumably have included the assumed planning permission for cottages, the alleged relevance of cl 6.21 of the 2nd s.106 agreement, the alleged marriage value with Cambridge Lodge and the alleged relevance of 45 Holloway Lane. The claimant’s valuer would in turn have said that he thought that Mr Macdiarmid had overlooked relevant features of Station Approach, Greenford. Messrs Pope and Macdiarmid accept the force of some of these points. That acceptance would have been recorded in an agreed statement months before the hearing. Such acceptance would have been regarded as demonstrating that Messrs Pope and Macdiarmid were complying with their duty to the tribunal. Further, Mr Macdiarmid would have had the opportunity to consider his revised discount and to present a revised valuation to the Tribunal. There would also have been rebuttal proofs dealing with the other points.

23. Mr Langham submits that the reference land never had any ransom value and that the case advanced in the Claimant’s statement of case is founded on thin air. The reference land never had any ‘key’ value to BA. Neither the 2^nd s.106 agreement nor any condition in the 1992 planning permission prohibited the use or enjoyment of BA’s offices in the absence of acquisition of the reference land, a matter recorded in Potter at paragraphs 53 and 88. If the CPO had not been confirmed against the reference land, BA would have been free to continue to enjoy the use of its offices. When he considered the question of ransom value in Potter, the acquiring authority’s valuer (Mr Richard Asher FRICS of Jones Lang LaSalle) was assuming a the existence of a Grampian-style condition preventing the enjoyment of the BA offices unless the Potter land had been acquired (paragraph 56).

24. It was thus submitted that BA’s obligation to pay compensation under the 2^nd s.106 agreement if a CPO was made merely reflected the obligation on the acquiring authority. The compensation would be the open market value and would be the same with or without BA’s obligationto reimburse the acquiring authority. BA was obliged to use reasonable endeavours to acquire the reference land for a period. Thereafter, whether the reference land was acquired was a matter of indifference to BA. The value to BA as a special purchaser is not the same as ransom value. The reference land did at one time have value to BA as a special purchaser by virtue of the obligation to use its reasonable endeavours to acquire the same in the 2^nd s.106 agreement, but this had ended long before the valuation date. In this regard the reference land was in exactly the same position as the Potter land and the conclusions in the Potter case are directly applicable.

25. As for the claimant’s new, alternative claim that, even after December 2000 the reference land had value to BA as a special purchaser because BA owned Cambridge Lodge and other land and it was advantageous to BA to consolidate its landholdings by adding the reference land since BA has long term development aspirations, this ingenious argument is said to assume that BA would still have been anxious to acquire the reference land after December 2000 if LBH had decided not to make a CPO. MrLangham submits that this argument is founded on a fundamental misconception. The only feature of the reference land that gives it any substantial value and any development potential is the scrap yard use. If BA had acquired the reference land it would have been obliged to extinguish this use under clause 6.21 of the 2^nd s.106 agreement. No other purchaser would have been obliged to do this. So, far from BA having a special interest in acquiring the reference land, it had a unique disincentive. The remaining provisions of clause 6.21 of the 2^nd s.106 agreement merely give BA the same freedoms that any other purchaser would have had, namely to enjoy any planning permission that the acquiring authority was prepared to grant. But any other purchaser would have been able to bargain on the basis of the scrap yard use. BA would have been asking for planning permission to develop open land in the Green Belt with a nil value use. Clause 4.3 meant that BA could not sell the reference land free of the obligations in clause 6.21. For good measure, Mr Langham also submits that marriage with Cambridge Lodge would produce no enhancement to anything. As Mr Pope pointed out, Cambridge Lodge has a single derelict residential building (which was just about visible on the site view). This could be rebuilt, perhaps with an extension. That is its development potential. Further, the reference land is not an infill site in Green Belt terms. In fact, as Mr Macdiarmid said, the claims in relation to Cambridge Lodge are no more than saying that a neighbouring owner is a special purchaser. The owner of Scotch Lake Farm is also a neighbour.

26. Mr Langham contends that the open market value of the reference land for the purposes of s.5, rule (2) of the Land Compensation Act 1961 is the highest of (1) the value arising from planning permissions which have to be assumed (there being no unimplemented actual planning permissions); (2) the existing use value; and (3) any hope value. The assessment of existing use value, planning prospects, and development value are matters of expert opinion. The Claimant has no expert evidence and cannot make any positive case in relation to these matters. All she can advance is unsubstantiated assertion.

27. So far as assumed planning permissions are concerned, Mr Pope accepted that planning permission for the park should not be assumed. Mr Langham submits that in this he was correct. The question is one of the construction of the 1992 planning permission, not the s.106 agreement. But the question is whether there was ever a planning permission to change the reference land from a scrap yard into part of the park. There was not. Even if the reference land was in the red line on the planning application, the detail of the park was determined by the Masterplan: see Potter paragraph 16. As finally approved this obviously cannot have shown the reference land as part of the park. In any event, the existence or non-existence of planning permission for park use of the reference land is a matter of no significance. Planning permission for park use is not valuable; and it did not produce any valuable uplift in compensation for the Potters. On the other hand, if planning permission for park use had to be assumed, this assumption would not reduce the value of the reference land. Mr Pope’s error in this regard was not adverse to the claimant, as had been suggested. Mr Langham accepted that Mr Pope had overlooked the planning permission to be assumed under s.15(3) of the Land Compensation Act 1961. But his answer in relation to this is said to be completely convincing. As the Court of Appeal stated in Greenweb, a planning permission assumed under s.15(3) is only of any use if it is capable of being implemented: see paragraph 35. The assumed planning permission requires knowledge of the building that is to be rebuilt - indeed the 10% allowance requires knowledge of the cubic content of that building. In Greenweb the dimensions of the original buildings were known: paragraph 6. It was agreed that the assumed planning permission was capable of being implemented: paragraphs 11 and 16.

28. Mr Langham submits that if the dimensions and form of the building are not known the planning permission is simply useless and cannot enhance value. He proceeds to demonstrate the point by way of an illustration and submits that Mr Macdiarmid was obviously correct to say that a planning permission which could not be implemented would have no value. Here the position of the building is known and there is a photograph. That shows perhaps half of one elevation. That is all that is known about the building. If the landowner started to build, what would he put at, say, the rear of the building? If the local planning authority served an enforcement notice, how would he be able to show that what he was doing was merely rebuilding what had existed in 1948? How would he be able to prove that the cubic content of his construction was within the 10% limit? In an enforcement situation the onus would be on him to prove that what he was doing had the benefit of planning permission.

29. With reference to existing use value, no-one had been able to find a scrap yard to consider as a comparable. The only suggested comparables were Station Approach, North Greenford and 45 Holloway Lane, Harmondsworth. So far as Station Approach is concerned, it is said that this site is in the local area - it is just less than 7 miles from the reference land - and it is one where unneighbourly commercial activities are carried out in the open so its value does not come from the enjoyment of buildings. The transaction (29 May 2008) is close to the valuation date. In the absence of a scrap yard comparable it is said to be the best available starting point (ie £600,000 per acre, or £450,000 for 0.76 acre). The reference land is at the end of a cul-de-sac through a village and it is not surfaced so it is said that a purchaser would have expected to have had to carry out additional work to make it secure. By contrast Station Approach is surfaced and with access directly onto an A road. These considerations caused Mr Macdiarmid to apply a 20% discount to the £600,000 per acre. However, it now appears that part of the Station Approach site is sterilised by the access road which runs through it which means that third parties are able to use the site. Mr Macdiarmid accepted that he would need to revisit the discount and that this would affect his valuation of the reference land. Mr Langham was not able to suggest the particular level of discount which should be applied to the £600,000 per acre which this comparables suggested and he invited the Tribunal to form its own assessment, having seen the site. Mr Macdiarmid did not consider that, for the purpose of assessing existing use value, the standard covenants imposed to protect Railtrack’s adjoining railway line were particularly relevant. Likewise with the overage provisions. Mr Macdiarmid accepted that, if the site came on to the market without overage provisions, the amount bid for it might be different; but any difference would reflect what the bidder thought about hope value, and the comparable in that event would be less useful. The existence of overage provisions meant that the amount bid would more closely reflect the value of the site for the purpose of carrying out the existing use which was the very matter Mr Macdiarmid had been seeking to ascertain.

30. Mr Langham dismisses the relevance of 45 Holloway Lane as a comparable. That site is surfaced, hoarded and benefits from a large building lawfully in use for industrial purposes. The transaction was in January 2011, substantially after the valuation date (and so would not have been known to any hypothetical purchaser of the reference land), at a time when the market is said to have been substantially different. Mr Langham acknowledges that Mr Macdiarmid’s assessment of value is not consistent with the offers made by Rogers Chapman in 1994 and 1997 and that no-one disputes that commercial land values increased over the period 1994 to 2008. But he questions whether the offers (which at that time were in fact from a special purchaser) form a reliable starting point. They were not based on scrap yard comparables but appeared to be based on hope value for development (both sites referred to having planning permission for built commercial development). It is said that they cannot be reconciled with the value at the valuation date of the Station Approach site; and that it is impossible to understand how the reference land could be worth more than the Station Approach site.

31. Mr Langham submits that Mr Macdiarmid’s deduction of £50,000 to reflect the future need to remediate contamination is generous to the claimant. He says that it is quite clear that the reference land was seriously contaminated because there is no proper basis for doubting the assessment of contamination made in an environmental assessment and remediation report prepared for BA in December 2011 by Subadra Consulting Ltd. It is accepted that the precise remediation and landscaping described in the report would not have been contemplated by a purchaser of the reference land as a scrap yard; but Mr Langham contends that the sum spent (£166,000) certainly shows that the £50,000 deduction is modest.

32. On the issue of hope value, Mr Langham submits that there is not a shred of evidence to support the assertion that a residential development embracing Cambridge Lodge, Scotch Lake Farm and the reference land was a possibility. All of the land was in the Green Belt. Such a proposal would inevitably have involved a significant loss of open land to buildings. The suggestion in Mr Bains’s skeleton argument that, because Scotch Lake Farm and the industrial estate exist, the acquiring authority would have permitted more inappropriate development on the reference land is “clearly wrong”. According to Mr Pope, the existing planning permissions for these sites reflect the fact that they have historically supported inappropriate development, not a recognition that industrial and residential buildings are regarded as acceptable in the Green Belt. It is said that the claimant’s reasoning would apply to all nearby open land in the Green Belt. The only planning factor in favour of permitting built development on the reference land is that it would have led to the replacement of the scrap yard use. Mr Pope accepted that this would be a positive factor but he also said that it would not amount to the very special circumstances required in this Green Belt location. His point that the scrap yard use did not involve a permanent loss of openness whereas buildings would is said to be important. He drew attention (paragraphs 7.11 and 8-23 to 8-30 of his report ) to planning policy which indicates that the appropriateness of Green Belt protection is not reduced because the relevant part of the Green Belt is not attractive. His point that the reference land was not an infill site in Green Belt terms is also said to be important. The suggestion put in cross-examination that, if LBH had been happy with a scrap yard, it would not have bothered with a CPO is said completely to miss the point. The CPO offered the choice between a scrap yard and landscaped open land and the latter was preferable. Hope value involves assessing the choice between a scrap yard and buildings.

33. Mr Langham points out that in order to find for the acquiring authority it is not necessary for the Tribunal to hold that the reference land had no hope value whatsoever. Mr Macdiarmid’s development appraisals show that there would have to be a very high expectation of being able to carry out a residential or an industrial development before the hope value would exceed the existing use value (effectively 46% and 55% certainty). Since this expectation did not exist, a more detailed investigation of hope value is not necessary, unlike the position in the Potter case. Mr Langham also points out that the need to reduce the discount has implications for this and that these implications are adverse to the claimant. If the existing use value increases so the percentages increase, ie the hypothetical bidder would need to be even more certain of getting planning permission for built development before he would be prepared to pay more than the existing use value. So Mr Macdiarmid’s already powerful points are said to become even more powerful. Whether the development appraisals are precisely accurate, and whether the Sycamore Farm and London Road sites are precisely comparable, is not really the central question. The prospects of securing planning permission would have to be very much greater than Mr Pope suggests before the hope value would exceed the existing use value.

34. On the issue of compensation for disturbance, Mr Langham does not accept that the compulsory acquisition of the reference land caused any loss of the magnitude of the claim (of £203,586) for lost assets. If such a loss was suffered, it was wholly the result of a failure to mitigate. Nor does Mr Langham accept that the Tribunal has proper evidence of the value of any item said to have been lost. There is no independent verification - or even corroboration - of any of the figures (eg evidence of the original acquisition cost). If the items were simply given away, the values ascribed seem extraordinary. Also Mr Nicholas Hall made the list for the purposes of this claim. Why, Mr Langham asks rhetorically, are there not photographs of each item, which could have been subject to scrutiny later? Any photographs taken by the acquiring authority’s valuer when he visited the reference land in October 2008 would have been of no assistance since they would not have shown what was on the reference land in December 2009. There is absolutely no reason why the value of any valuable items should not have been realised. If Mr Anthony Hall did not realise that the acquiring authority owned the land from the date of the General Vesting Declaration, he should have done. He had professional advisers acting for him; indeed, he had just fought the CPO all the way to the Court of Appeal. He should have started to vacate the site at once. He was entitled to compensation from the time of the General Vesting Declaration and he should have known that he had no future in Moor Lane: Mr Macdiarmid had told him that the acquiring authority needed vacant possession. Instead he continued to trade, apparently filling the site to the brim. Quite possibly he brought items on to the site which now appear on his son’s list.

35. Mr Nicholas Hall confirmed that no steps were taken to find an alternative site until October 2009, 15 months after the General Vesting Declaration, and that no steps were taken at all to sell these allegedly very valuable items. The Halls made no effort to obtain a quote for the removal of the items themselves. Mr Langham does not accept that, if the Halls had left everything on the reference land, LBH would have sent in their contractors and charged them probably more than £500,000 (as Mr Anthony Hall asserted at paragraph 28 of his witness statement). If this evidence had been served at the proper time, the acquiring authority would have been able to explain what it had done and what it had not done. Mr Macdiarmid certainly knew nothing about any such suggestion. The acquiring authority had been told by a Mr McCann that it would cost about £15 - 20,000 to clear the reference land. Mr Langham is not able to say whether or not someone may have mentioned half a million pounds to Mr Hall but it was submitted that the Tribunal should not find that this had anything to do with the acquiring authority in circumstances where it has not had any opportunity to give evidence on the point. Apparently the Halls were not talking about taking rubbish to a landfill site, but about giving away items which could be resold for £200,000. So any removal contractor would have stood to receive £700,000. If anyone did mention half a million pounds, Mr Langham submits that this was patent nonsense and that Mr Hall should have known this. In short, Mr Langham does not accept that the acquisition caused the loss of any valuable assets. He accepts that the claimant is entitled to any actual costs of dumping rubbish and the actual costs of removing assets to a new site (or a reasonable proportion of actual costs if the actual costs are excessive). If removal/dumping costs had been incurred, they could easily have been proved by invoices; but the Tribunal has been provided with nothing. The allowance of £5,000 made by Mr Macdiarmid is said to be reasonable in these circumstances.

36. Mr Langham therefore invites the Tribunal to award: (1) for the land taken, the sum of £450,000 (less a discount of up to 20%); and (2) for disturbance, £5,000.

The claimant’s case in reply

37. Mr Bains submits that: (1) the acquiring authority omitted to reserve for itself the right to impose new covenants in the transfer of the reference land to BA which would have enabled the enforcement of the covenants contained in the 2^nd s.106 agreement; (2) the transfer of the reference land dated 18 December 2009 to BA contains no covenants specifically referring to the obligations under the 2^nd s.106 agreement; and, in consequence, (3) although BA is contractually bound to comply with the provisions of the 2^nd s.106 agreement, in the event that BA transfers the reference land, it will be released from such obligation.

38. Mr Bains submits that the Tribunal should disregard Mr Pope’s evidence in its entirety and should draw the obvious adverse inference in respect of the acquiring authority’s unreasonable behaviour in submitting such a report for consideration because Mr Pope’s attempts to refer to coloured photographs which he had taken with him into the witness box without supplying copies to the claimant, and to mislead the Tribunal by falsely asserting that he had viewed the reference land from the Moor Lane frontage (from which it is not visible) graphically demonstrate his conflict of interest and lack of independence. Mr Bains further submits that in certain identified respects Mr Pope’s report failed to address its subject-matter on a fair and comprehensive basis and contained various errors, omissions and misleading comments which were all in favour of the acquiring authority. He submits that the report was not impartial and up to the standard of an expert’s report suitable for submission to the Tribunal. The report was designed to enhance the position of the acquiring authority and/or BA at the expense of the claimant, and it would be unsafe for the Tribunal to rely upon it.

39. Mr Macdiarmid, it was submitted, was also severely biased in favour of the acquiring authority and BA. Also, as became apparent in cross-examination, he did not understand the full meaning and consequences of taking the oath and this misunderstanding, namely failing to recognise that he had to tell the whole truth (and not just the parts that helped his client) and nothing but the truth (and therefore not include irrelevant material), is actually reflected in his report. Mr Bains emphasises a number of other matters arising out of Mr Macdiarmid’s cross-examination. Without in any way limiting the breadth of Mr Bains’s attack upon Mr Macdiarmid’s evidence, he relies in particular upon the following: (1) Since, as Mr Macdiarmid confirmed, the planning status of the reference land is a very important consideration in its valuation, Mr Pope's deliberate failure to ascribe any positive virtues to the reference land would have had an obvious and detrimental effect on Mr Macdiarmid's report. (2) Like Mr Pope, Mr Macdiarmid had missed the significance of s.15(3) of the Land Compensation Act 1961; but he then put forward an “incredible” account to try and defend his position. He said even though he realised he had made an error and in fact planning permission could be assumed under s.15(3) he would not take that assumed planning permission into account because he “knew” that the planning consent could not be implemented because no one knew the precise specifications of the houses that had existed previously. It is said that essentially he thereby demonstrated that he did not understand his obligations and duties as an expert valuer. (3) Mr Macdiarmid tried to suggest that he had not taken contamination costs into account in his residential development appraisal figures when he had in fact allowed £180,000 for remediation. (4) Mr Macdiarmid had exaggerated or falsely asserted negative features of the reference land in order to create a poor impression of the claimant and the reference land. (5) Mr Macdiarmid had omitted any reference in his report to his valuations of scrap yards in the Olympic Park when, given the paucity of generally available evidence, with most deals involving scrap yards being sold “off-market”, such details would have been extremely helpful to the Tribunal and to the claimant. (6) Despite being aware of Rogers Chapman’s offers for the reference land, Mr Macdiarmid refused to accept that there had been any increase in the value of the reference land as between 1994 and the valuation date of July 2008, some fourteen years later. Mr Bains submits that a surveyor who believes that property prices have gone down by a third (from £450K to £300K) in the London area between 1994 and 2008 cannot be relied upon. This is cited as yet another example of Mr Macdiarmid’s lack of independence and his attempts to support an unsupportable position to the detriment of the claimant and in favour of BA. Mr Bains submits that, on any interpretation, the fact that there had been an offer to purchase at £450,000 through a reputable firm of chartered surveyors stated to be based on "prevailing market values”, subject only to contract (ie not subject to any conditions regarding planning, remediation etc), must be the clearest and best evidence possible of the then market value of the reference land. The claimant has provided an indication as to what that offer would have been worth in money terms in July 2008 if the increase in the house price index is taken into account, namely £1.77 million.

40. Mr Bains submits that by any accounts, this figure of £1.77 million must be the approximate true value of the reference land as at the reference date on a vacant possession basis. This does not take into account the fact that in view of the closure of a number of scrap yards during the period 1994 to 2008, the remaining scrap yards (including this one) would have acquired a greater value due to their scarcity. Since it is not possible to place any reliance upon the reports of Messrs Pope and Macdiarmid, Mr Bains submits that if there were no other factors, the value of the reference land should be determined by reference to this offer of April 1994, which (1) was made by the person that is ultimately going to pay now, (2) was based on prevailing market values, and (3) should be adjusted to take account of inflation in property prices. It is submitted that this must surely produce the fairest result and one with which BA cannot possibly argue. This is subject to the claimant’s preferred grounds of compensation being based on ransom value. It is only if the claim based on ransom value fails that the claimant submits that this alternative method of valuation should be adopted by the Tribunal. Whilst the House Price Index (HPI), due to its name, may not be the best or the most accurate and precise method of assessing the change in open market value of the reference land, the acquiring authority have not provided any other index or figures. Mr Macdiarmid’s position was that there had been no increase during that period which is said to be manifestly wrong. The claimant has no other index, such as a “scrap yard index”, that she can refer to; and in the absence of any other index - and Mr Macdiarmid did not suggest any better index to the Tribunal - Mr Bains submits that this should be adopted in preference to the figures and report presented by Mr Macdiarmid if the land is to be valued on an “existing use” basis.

41. The further objection raised by Mr Macdiarmid that it reflects national price changes would actually only serve to disadvantage the claimant because the reference land is based in London where, it is submitted, prices during that period have risen faster than the national average. Mr Bains submits that in fact the base offer that should be used for the calculation of the existing use value is the offer from Rogers Chapman dated 25th of August 1989 (at Bundle 2/D/22 - 23) of an option price of £800,000. Assuming that this offer had been accepted and accurately reflected the value of the reference land, and assuming that the option would have been exercised within the three-year period, the claimant would have received £800,000 by 1992 at the latest. That sum would have been worth £3,090,566 as at July 2008, taking into account the increase in the house price index: see Bundle 3/F/185-6. Mr Macdiarmid had had six years to assemble scrap yard comparables and was professionally trained to do so. He had failed to produce a single scrap yard comparable during such a long period. This is said to be truly remarkable.

42. On the issue of the loss of stock, Mr Bains points out that the claimant did not receive a penny until December 2009, i.e. after she had been asked to vacate within 28 days. The claimant and her husband were pensioners at the time but, according to the acquiring authority’s arguments, they were expected to have had the funds and the resources available to relocate a scrap yard of this size, which was full of stockpiled scrap many feet high, without any financial assistance from the acquiring authority. It is submitted that this was a totally unreasonable and oppressive expectation and requirement. The effect of this was to force the claimant and her family to take emergency action to salvage whatever could be salvaged to avoid further punitive action by the acquiring authority, who had indicated (through the contractors) that it would cost £500,000 to clear the reference land within the four-week period. The acquiring authority should have the correspondence in their files but they had not produced this in these proceedings. Their offer of £5,000 for the removal expenses, with nothing for the loss of stock, is said to be insulting in the extreme.

43. The Tribunal is invited to find that the claimant’s actions were entirely reasonable in the circumstances. Had the claimant had sufficient notice, and not been lulled into a false sense of security by the acquiring authority, she might have been able to sell most of the stock that was not required. Instead, she was faced with a situation where she could not take all of the stock with her to the new alternative site and she would either have had to leave it on the reference land and allow the council's contractors to take it away (and charge their proposed exorbitant fees) or allow someone else to take it free on the basis that she would not have to pay them any removal costs. Some of that stock was valuable and some of it was not. It was the evidence of Mr Nicholas Hall that some valuable stock had to be given away in order to give the collector sufficient financial incentive to take the “not so valuable” stock as well. The Tribunal is invited to bear in mind the circumstances at the time, the age of the parties, their resources, the time of year and the threat of the acquiring authority charging a very substantial figure for clearing the reference land if the claimant failed to do so in time.

44. Messrs Nicholas and Anthony Hall are said to have given a very honest and full account of the position in their witness statements and to have came across as credible witnesses. Mr Nicholas Hall was challenged as to why they had not taken steps to move earlier after having been served with the general vesting declaration and why they had maintained stocks at the level that they had and had continued trading. Both he (and his father) explained that they had had to continue trading in order to earn a living and that they had not received any compensation from the acquiring authority with which they could have sought to secure any alternative premises. They had indeed appointed professionals to advise them of the process but at that time they had not received any advice suggesting that they would be asked to leave within a 28 day period in a notice that would be given on a date unilaterally chosen by the acquiring authority. The original advisors were subsequently replaced. Mr Anthony Hall expected they would be given a reasonable period to vacate, which he thought would be about six months. Mr Bains submits that given that the whole process had been going on for years, his expectations were not unreasonable.

45. The Tribunal is also invited to bear in mind that in order to buy another yard they would have needed money in their pockets. The acquiring authority did not pay them any compensation at all until December 2009. As the acquiring authority had not taken any prudent (or indeed any) steps to assess the value of the stock as at the valuation date despite having had the time, opportunity and resources to do so, and as it was in possession of the report dated 31 October 2008 from Edward Symmons with its advice, it is submitted that the only reliable evidence that is before the Tribunal is the evidence of Mr Nicholas Hall and that that should be accepted at face value as an honest evaluation of the goods that had to be given away to save incurring removal costs by third parties in respect of the same items. It was accepted by Messrs Anthony and Nicholas Hall that if they had been given more time (as recommended by Edward Symmons) then they might have been able to sell some of the goods which they were otherwise forced to give away. The acquiring authority is said to be the person that is to blame for the situation. It created the situation by not following Edward Symmons’s advice and it is the one that should have to suffer the loss, not the claimant. Mr Nicholas Hall and the claimant have accepted that they do not have any evidence to produce to the Tribunal of the additional stock that was given away and which they did not manage to record or write down on any list produced at the time. They have estimated that this amounted to a further £195,000, and they accept that as they have insufficient evidence that will have to be written off and the loss in that respect borne by them.

46. Mr Bains made detailed submissions on the issue of the alleged contamination of the reference land and the relevance of the Subadra Consulting Ltd report. He submits that the deliberately contrasting treatment by the acquiring authority in the 2^nd s.106 agreement of the Halls’ other site at Brookside as being possibly contaminated and the reference land as not being contaminated were relevant factors which Mr Macdiarmid should have taken into account in arriving at his valuation figures. Neither the claimant nor her family nor her neighbour, Mr Thurlbeck, considered there to be any excessive contamination of the reference land. Not all of the works referred to in the Subadra report were essential and many consisted of improvements or matters that BA may have specified.

47. Mr Bains addressed the comparables. As regards Station Approach Greenford, he emphasised that Mr Macdiarmid had been unaware of the precise boundaries of the site and had not appreciated that there was a right of way running the entire length of the site leading to a waste transfer station beyond. He had had to accept that this would substantially affect its value given that the site was very narrow. The access would also render the site insecure. Mr Macdiarmid was criticised for downplaying the effect on the value of the site of the adjoining railway line and the covenants imposed for its protection and also of the overage provisions affecting the entire site which would adversely affect its development value. Mr Bains submitted that Mr Macdiarmid’s position in relation to Station Approach was untenable and that his refusal to accept the obvious showed quite clearly the degree to which he had been influenced by the conflict of interest situation that he had found himself in. As for the Sycamore Farm site at Staines-upon-Thames, there were issues with the extent of the right of way serving, and the restrictive covenants affecting, that land. Mr Macdiarmid would not accept that these matters affected his valuation in any way. Again, his position cannot be justified other than on the basis that he is biased against the claimant. Mr Bains also pointed to the deficiencies of the land at the junction of London Road and Town Lane, Ashford, Middx.

48. As to 45 Holloway Lane, Harmondsworth, relied upon by the claimant, Mr Bains submitted that this land was more suitable to be used as a comparable because it was in the same village as the reference land and, although it had hard standing and buildings on it, those buildings were dilapidated. The site was irregular in shape and had last been used as a builders’ merchant. It had very poor off-road parking provision and the potential for development was limited by the shape of the site and the lack of on-street parking. The available data for it was much later than the valuation date but it was submitted that the reference land was better all round, as at the valuation date, in terms of location, outlook, parking, planning potential and size (about double).

49. On the issue of ransom value, Mr Bains submitted that, for the reasons originally advanced, the reference land was different from the Potter land and it did have ransom value. The reference land was not going to form part of the park but was expressly recognised as development land by clause 6.21 of the 2^nd s.106 agreement and BA could not therefore argue that it was of no interest or value to it. Indeed, on this basis alone the reference land would have a significantly higher value than Potter land, which was designated as parkland and found to have a value of £1,000,000. Mr Bains submits that the claimant is entitled to demand a ransom value as the appropriate value of the reference land as at the valuation date as BA was in the position of being a developer who had had to pay a ransom value from the date of the General Vesting Declaration. The open market value of the reference land as at the valuation date should reflect the price that BA would have been willing to pay in order to acquire the land and terminate the scrap yard use in order to comply with the terms and conditions of the planning permission which it had already implemented. Until BA had acquired the reference land and terminated its use as a scrap yard, it could not confirm or claim that it had completed all of its outstanding obligations under the terms of the 2^nd s.106 agreement. It would have known, and did know, that this was an outstanding obligation on its part; and, having implemented the planning permission already, it was in no position to renegotiate the terms. If it was willing to pay an extra £90,000,000 on construction costs because it wanted to carry out its development so very much, it went without saying that it would have been willing to pay a very substantial sum of money in order to comply with this condition as well. The argument that it would not have done so, or that it was of no use to BA, simply did not wash. A lot of the extra £90,000,000 might have been spent on the park and would not have been of any use to BA or necessarily desirable from its point of view; yet it was ready and willing to spend it as the office use was so valuable to BA and this was a collateral expense.

50. In conclusion, Mr Bains submits that the Tribunal should award the claimant compensation calculated by reference to the ransom value of the reference land, and make an order requiring the acquiring authority to obtain and supply details of the gross construction costs and the gross development value of BA's development land, including the new park (which is in BA's ownership and will be available to BA to make speculative applications for planning permission in the future) so that a further order can be made at a future date in respect of the actual compensation figure to be paid to the claimant. If the claim for ransom value is not accepted by the tribunal, then Mr Bains submits that the minimum value of the claim, based on existing use value, should be £1.7 million, together with a further sum of £203,586 in respect of the scrap removed from the site, as well as statutory interest and costs. The Tribunal is also invited to make an award of such sum as it considers reasonable to cover the claimant’s costs of removing such of the items as she was able to the new scrap yard at Iver, Bucks. When considering what sum to award, the Tribunal is invited to take account of the fact that the claimant has no security of tenure at the new yard and that the business could be forced to relocate or, more probably, close (given the age of the claimant and her husband) on short notice by the existing freeholder, Mrs Cotterell, who is herself an elderly lady. The claimant submits that had she had the financial resources, she and her husband would have closed down the business in December 2009 as they were both over retirement age at that time but they had been forced to relocate just to try to salvage the fruits of a lifetime of labour.

51. Mr Bains also invites the Tribunal to award costs to the claimant on the indemnity basis in any event given what is said to be the unreasonable behaviour of the acquiring authority in submitting expert opinions which it knew, or ought to have known, fell way below the standards required in legal proceedings and generally the manner in which it has behaved towards the claimant. In the background BA, which is actually going to pay the compensation, is said to have behaved appallingly. Mr Bains relies, in particular, upon a copy of an e-mail from Mr Richard Farrer to Mr James Steevens (both of CBRE) dated 8 April 2013 in which the influence of BA with regards to the manner in which the claimant had been able to present her case is said to have been placed beyond any doubt. The email (sent at a time when Mr Farrer was apparently working at BA’s new office development) asked Mr Steevens to decline to accept an instruction to act for the claimant in relation to her claim for compensation for the CPO in order not to jeopardise the negotiations for the renewal of CBRE’s existing contract to act for BA.

Discussion and findings

52. We note that due to the inexcusable delay in producing witness statements from Messrs Anthony and Nicholas Hall, the acquiring authority has had no proper opportunity to adduce any evidence to rebut the allegations which they have made against it. We do not consider that there is any substance in any of the criticisms made against the acquiring authority with the exception of its omission to give rather more advance notice to the Halls of the precise date when it would be requiring them to vacate the reference land. In the light of the advice at para 5.02 of the Edward Symmons’ Report dated 31 October 2008 that “the optimum and most cost effective approach to the clearance of the site would be to instruct the owner to do so within a fixed period, after which he would be charged for the costs of any further clearance necessary”, we cannot understand why the acquiring authority waited almost a year before giving only one month’s notice requiring the claimant to vacate the reference land, particularly since the acquiring aware was clearly aware of the long-stop date in the proviso to cl 16.9.3 of the 2^nd s.106 agreement (which provided that BA could not be required to accept a transfer of the reference land after 31 December 2009). As against that, however, we are satisfied that, at a time when they appreciated that their continuing occupation of the reference land was precarious, the Halls proceeded to intensify their use of that land as a scrap yard in order to derive the maximum profit from it. We do not accept that the acquiring authority has concealed any material information from the claimant or that it has made it virtually impossible for her to secure effective professional advice and representation. We accept that CBRE declined to continue to act for the claimant because of internal pressures within CBRE which were motivated by a desire on the part of CBRE not to lose the opportunity to secure the renewal of a valuable contract with BA; but the email of 8 April 2013 does not suggest that any pressure was being put upon CBRE by BA itself, still less by the acquiring authority. We are satisfied that there were other professional advisors to which the claimant could have turned, and did turn, for advice and representation; and we see no reason to reject the evidence of Mr Macdiarmid that the claimant declined to accept the valuation advice of one firm of valuers (Montagu Evans) who then ceased to be instructed by her.

53. We reject the claimant’s attacks upon the professional integrity and impartiality of the two expert witnesses called by the acquiring authority. We accept that they were appropriately qualified to give expert evidence in their respective fields. We do not accept the submissions advanced on behalf of the claimant that Mr Pope deliberately lied about his site visit to the reference land and that he deliberately put everything in to his report which favoured BA and the acquiring authority whilst deliberately omitting everything that could have favoured the claimant. We find that Mr Pope was mistaken in his recollection that he had been able to see in to the reference land from the hedge adjoining Moor Lane. Since he also said that he had not gone round to the back of the site (as we did on our site visit) we find that Mr Pope must have viewed the reference land from Scotch Lake Farm to the east which he said (at para 4.1 of his report) that he had also visited. We do not consider it likely that an expert would have lied about such a fundamental matter as visiting the reference land. Moreover, Mr Pope was accurate in his evidence that it had been very difficult to see into Cambridge Lodge and in his recollection that it was “very overgrown”. Mr Pope acknowledged in cross-examination that he had made no express reference to Cambridge Lodge beyond a passing reference to it in para 8.20 of his report which he accepted could have been more explicit. Mr Pope was prepared to concede in cross-examination that some weight should be attached to the fact that the removal of the existing use of the reference land as a scrap yard would have been perceived as a benefit in planning terms; but we accept that he genuinely holds the opinions, which are uninfluenced by his continuing professional relationship with BA, that this would not have rendered residential development an appropriate use of the reference land because this would have gone against the fundamental purpose of the Green Belt of preventing urban sprawl and also that scrap yard use would have been preferable to the local planning authority than any form of built development. Mr Pope accepted that notwithstanding the terms of para 8.4 of his report, the reference land did not have the benefit of an existing planning permission for use as park land.

54. We accept also that Mr Macdiarmid’s evidence reflects his genuine professional opinions uninfluenced by any partiality towards either BA or the acquiring authority. We agree with his view that the use of national house price indices to adjust land values to reflect the passage of time is very subjective and unhelpful when applied to the reference land. However we do agree with Mr Bains that it would have been of assistance to the Tribunal if Mr Macdiarmid had been able to proffer some more reliable alternative index or figures. Mr Macdiarmid acknowledged that the Greenweb case had come as some surprise to both of the acquiring authority’s experts. However, we accept Mr Macdiarmid’s evidence (which was supported by Mr Pope) that because there was no sufficiently clear evidence of precisely what buildings had been on the reference land before the demolition of the former cottages, a hypothetical purchaser would not have attached much weight to the planning permission assumed by s.15(3) of the Land Compensation Act 1961 when bidding for the reference land at the valuation date (and at a time when the market was in very poor state) because of the perceived difficulties in implementing such assumed consent and resisting any enforcement action by the Local Planning Authority.

55. We also accept Mr Macdiarmid’s evidence that the combination of the reference land with other adjoining land (such as Cambridge Lodge) would not have released any significant marriage value because of the restrictions affecting the development of land in the Green Belt. We accept Mr Macdiarmid’s assessment that the derelict state of Cambridge Lodge would not have adversely affected the value of the reference land for use as a scrap yard. Mr Macdiarmid accepted that industrial property values had increased between 1997 and 2008 by something in the order of two-thirds; but he emphasised that by the valuation date in 2008 one was dealing with a very different market where the banks had stopped lending, there were very few buyers, there were very few transactions, and any purchaser would have needed to look to cash reserves for part of any purchase price. Mr Macdiarmid acknowledged that he had been unable to find any direct comparable for the reference land at the valuation date because there had been no sale of a scrap yard. He accepted that he had not been aware of the right of way running through the Station Approach, Greenford site, that this was something that he had not taken into account, and that it would have affected his valuation of the reference land because it would affect the amount of usable space, would sterilise part of the land, and would raise security issues in relation to the Station Road site, requiring adjustments to be made to his analysis of that comparable.

56. We accept Mr Bains’s submission that BA personally will cease to be bound by the restrictions in cl 6.21 of the 2^nd s.106 agreement once it transfers the reference land to a third party although, by cll 4.2 and 4.3, these restrictions will continue to be binding upon, and enforceable by LBH against BA’s successors in title to the reference land. As a matter of law, however, the covenants in the 2^nd s.106 agreement are enforceable against the owner of the land for the time being even though they were not expressly mentioned in the transfer of the reference land to BA. We reject Mr Bains’s submissions in this regard.

57. It was Mr Anthony Hall’s evidence that scrap yards do not come on to the market very often and that when they do change hands it is usually to family members or other persons already in the trade. He said that it was very difficult to get planning permission for a yard like Rose Cottages Scrap Yard, and that he would have had to pay a fortune to get something similar. Local Planning Authorities did not give permissions for scrap yards easily and to get one in the countryside would be virtually impossible now.

58. Based on the evidence of Messrs Anthony and Nicholas Hall and Mr Thurlbeck we find that the reference land was largely secure at the valuation date, and whilst we agree with Mr Macdiarmid’s opinion that a hypothetical purchaser of the land as a scrap yard might well have contemplated undertaking some additional works to improve security, we do not consider that this would have influenced his bid for the land to any significant extent. Mr Macdiarmid accepted that he would have valued the reference land at £350,000 (rather than £300,000) but for the extent of the contamination affecting the site. He also accepted that there was no empirical evidence to justify his allowance of £50,000 for the costs of remediation, and that this was just his professional opinion. We do not find that there should be any substantial allowance for the costs of remediating the reference land. A hypothetical purchaser of the reference land as a scrap yard would not have been concerned to undertake such works himself (as Mr Macdiarmid accepted) and he would have viewed any potential liability for the future costs of remediation, should be the land ever be redeveloped for some other use, as a sum to be deducted from any future consequential development gain (otherwise he would not consider it to be worthwhile discontinuing the existing valuable scrap yard use).

59. Against that background we turn to consider the alternative bases of valuation advanced by the claimant. We reject the claim based on ransom value. We do so for the reasons advanced by Mr Langham, which are essentially the reasons stated by the Upper Tribunal at paragraph 88 of its decision in the Potter case. We are satisfied that the analysis in that paragraph is well-founded both in fact and in law. Mr Bains sought to draw support for the claimant’s case from paragraph 89 of the decision in Potter and the reference therein to BA as a “special purchaser”. However, we are satisfied that this is to take the Upper Tribunal’s words out of their true context. At this point in its decision, the Upper Tribunal had already rejected point (d) (as identified at paragraph 72 of its decision) having decided that the Potter land had no value to BA as a special purchaser at the relevant valuation date. The Tribunal had then moved on to consider issue (e) (whether any special value fell to be left out of account under the statutory provisions or the Pointe Gourde rule) on the hypothetical (and counter-factual) basis that the Potter land had indeed had a value to BA as a special purchaser at the relevant valuation date.

60. The reality is, as Mr Langham submitted, that although the reference land had at one time had a value to BA as a special purchaser by virtue of its obligation, in the 2^nd s.106 agreement, to use reasonable endeavours to acquire it, this had come to an end on 31 December 2000, long before the valuation date applicable to the reference land. After this point in time, BA had ceased to be a special purchaser because neither any condition of the 1992 planning permission nor any provision in the 2^nd s.106 agreement prohibited the continuing use of BA’s office development in the absence of the acquisition of the reference land. In this regard, the reference land was in exactly the same position as the Potter land; and the conclusions in the Potter case are directly applicable. We also reject the submission that BA’s ownership of Cambridge Lodge made it a special purchaser of the reference land and accept Mr Macdiarmid’s evidence that the combination of the reference land with Cambridge Lodge would not release any significant marriage value because of the restrictions affecting the development of land in the Green Belt. This is also relevant to the question of hope value, to which we now turn.

61. Regarding hope value, we accept Mr Langham’s submission that, in view of its location within the Green Belt, and having regard to the unfavourable market conditions then prevailing, any prospective developer would have so discounted the chances of securing an acceptable planning permission for residential or industrial development when bidding for the reference land at the valuation date that he would inevitably have been outbid by a hypothetical purchaser interested in acquiring the reference land for its existing use as a scrap yard. The special value attaching to the existing scrap yard use was a theme of Mr Anthony Hall’s evidence as summarised at paragraph 57 above.

62. We therefore now turn to the value of the reference land in its existing use as a scrap yard. Here we find ourselves hampered by the lack of any reliable comparable evidence. We do not accept that the claimant can place any reliance on the price of £800,000 at which Rogers Chapman proposed that BA should enter into an option to purchase the reference land in their letter of 25 August 1989 (an offer rejected by the claimant). BA had entered into a similar option arrangement with the Potters (at a price of £1.5 million) yet it never chose to exercise that option before it lapsed on 31 December 1991. During that period BA was in the position of a special purchaser. Its willingness to enter into an option (which it might never have exercised) at a price of £800,000 in August 1989 is no reliable evidence of the open market value of the reference land at that time, still less so in July 2008. BA was still a special purchaser at the time it offered £450,000 for the reference land in 1994 (at a time when it was obliged by the 1^st s.106 agreement to use “best endeavours” to acquire the reference land) and again in 1997 (by which time it was obliged by the 2^nd s.106 agreement only to use “reasonable endeavours” to do so).

63. We do however accept that the expressed basis of BA’s 1997 offers (referring to an independent report and valuation stating that the current market value of the reference land was £350,000), and the later offer by the acquiring authority in March 1998 of £350,000, are some evidence that the open market value of the reference land was at least that sum in 1997 and 1998. If one were to apply Mr Macdiarmid’s estimate of a two-thirds increase in property values between 1997 and 2008, the resulting figure would be some £583,000 (£767,000 per acre).

64. How then does such a figure compare with the Station Approach, Greenford comparable, the sale price of which, at £600,000 per acre (without any adjustments), would support a value of £450,000 for the reference land? The Greenford site is in an urban rather than a rural location but it suffers the considerable disadvantage of having a right of way running through the length of the site, sterilising the use of a significant part of it and raising security issues. Indeed, it was not being used as a scrap yard at the time of our inspection, and we fail to see how it ever could be with these impediments. The right of way leads to a waste transfer station, and the area of the site that needs to be kept clear needs to be sufficient to allow two large container lorries to pass. Thus the unusable area makes up a large percentage of the overall site size. Whilst Mr Macdiarmid referred to the site being used for “bad neighbour uses” it appeared to be generally clean and tidy with a significant area being given over to open storage and certainly bears little resemblance to a scrap yard which, we accept, due to its rarity value will be worth rather more than an impeded open storage site. Further, there is the question of the stringent overage provisions reserved to BRRB to consider, and in our view that would have a further reducing effect upon the open market value..

65. Whilst by no means an ideal comparable, Sycamore Farm, Chertsey Road, Staines-upon-Thames should not in our view be entirely ruled out. It was a one acre secure site with some impediments to access (shared) and weight restrictions on Staines Bridge (although not from the Chertsey direction). It had workshops and offices and consent for the parking of lorries and B8 uses. The land failed to sell at auction in July 2009, a year after the valuation date, but was said to have been withdrawn at a bid which equated to £695,000 per acre.

66. On a per acre basis, we therefore have figures ranging from £600,000 through £695,000 to £767,000. We therefore conclude that, far from agreeing with Mr Langham’s submission that “it is impossible to understand how the reference land could be worth more than the Station Approach site” after adjusting for their different areas, we think it most likely that with the benefit of the premium that would undoubtedly apply to scrap yard use, the reference land would probably be worth rather more per acre. However, we do of course have no scrap yard comparables to go on, and we also need to bear in mind that the reference land was unsurfaced and in a rural area where, whilst there appeared to be no weight restrictions on the Moor Lane Bridge, it was not the easiest site to get to.

67. Doing the best we can under the circumstances, and not forgetting the difficulties placed before us by having no expert evidence from the claimant, we conclude that the reference land would have been worth £700,000 per acre at the valuation date which equates to £532,000 - from which in our view, for the reasons given, no deductions should be made. We agree with the arguments advanced by Mr Langham (set out in paragraph 33 above) that a higher value for the land as a scrap yard reduces further the likelihood that any potential hope value for alternative, and perhaps more valuable, uses might become more than the existing use value. In any event, we have given our conclusions on the hope value question above.

68. On the issue of compensation for disturbance we largely accept the submissions of the acquiring authority and reject the claimant’s case. Mr Nicholas Hall accepted that he had known about the general vesting declaration in July 2008 and that he had also known that that had given the acquiring authority ownership of the reference land and that it would be taking possession of the site in due course. Mr Anthony Hall accepted that he knew that the acquiring authority had made a general vesting declaration in July 2008. In view of the professional advice available to him at the time, and in the light of his son’s evidence, we do not accept Mr Anthony Hall’s assertion that he did not understand that the reference land had thereby become the acquiring authority’s land. We also accept Mr Macdiarmid’s evidence that in both August and October 2008 he had visited the site and had encouraged Mr Anthony Hall to produce and submit a claim for compensation to the acquiring authority because the land had become vested in LBH and it would be requiring vacant possession. Mr Anthony Hall accepted that LBH had never told him that they would give him 6 months’ notice. He had merely hoped that that was what they would do. Despite that, Mr Anthony Hall said that he had continued to buy and sell scrap. Mr Thurlbeck said that in the last year of the Halls’ occupation, the site was always full to overflowing, and that there were lorries arriving every day carrying stuff in and out. Mr Nicholas Hall said that he had never personally looked for another site, but that he did not know if his father had done so. We are satisfied that Mr Nicholas Hall would have known if his father had done so.all Ha We find that Mr Anthony Hall had not been looking for an alternative site. He could, and should, have submitted a claim for compensation after July 2008. We accept the acquiring authority’s case that to the extent that any loss of stock has been suffered in the course of clearing the reference land, this is the product of a wholesale failure to mitigate on the part of the claimant and her family, who had wished to profit from the continuing use of the scrap yard for as long as possible. In any event, we do not accept the accuracy of the list of items removed from the site which was produced by Mr Nicholas Hall.

69. There is no independent verification of the value of the items said to have been given away. There are no supporting receipts or other documents (such as documents submitted to the Inland Revenue) to support a claim for loss in the value of the Halls’ stock. We find that the Halls never thought that it would cost them £500,000 to clear the site. Mr Macdiarmid said that he had not been aware of such a figure and that the only estimate of the cost of clearing the site of which he had been aware was a figure of £20,000, based on a price per ton and an estimate of the tonnage involved (and which included any landfill levy, which would not have been payable in the event of relocation to another scrap yard). If a figure of £500,000 was ever mentioned to any of the Halls, we are satisfied that, as experienced dealers in scrap and shrewd and knowledgeable businessmen in that trade, they would have appreciated that such a figure was utter nonsense. Mr Nicholas Hall said that he did not believe that the family had made any inquiries at the time as to how much it would cost to clear the site. Even allowing for the time constraints under which they were operating to vacate the reference land, we cannot accept that the Halls would have given away any valuable items of scrap, many of which would have been readily saleable if the list were accurate. It was apparent to us on our site visit that Mr Nicholas Hall appeared to be well acquainted with persons operating in similar businesses in the locality. We reject the evidence of simply giving valuable scrap away as incapable of belief.

70. Again, doing the best we can on the material available to us, we would allow the claimant £20,000 for her claim for disturbance.

Disposal

71. We therefore determine total compensation in the sum of £552,000 and this decision is final on all matters other than costs of the reference. The parties may now make submissions on such costs, and a letter giving directions for exchange of submissions accompanies this decision.

DATED 17 November 2015

David R. Hodge

His Honour Judge David Hodge QC P R Francis FRICS

United Kingdom Upper Tribunal (Lands Chamber)

BETWEEN SHEILA GRACE HALL Claimant