I've been served with a Compulsory Purchase Order on my business premises - what should I do?

Published on: 4th April 2017

Richard Farr, partner and compulsory purchase expert, explains what you should do if your local authority serves you with a compulsory purchase order.

Although only a small proportion of businesses will ever have to face the issue of compulsory purchase, the use of powers is increasing - not least because of national infrastructure projects like HS2 and Crossrail. Clearly it can be a very stressful time for any SME owner, but if you are aware of the situation, remain sensible and get the right advice, then there is no reason why you should be left short.

The first message I would give to any business owner and/or operator is to be aware of what is happening at a strategic level in your area. The first seeds of any CPO normally lie in the planning system and business owners should be conscious of emerging planning policies. At this stage, do not bury your head in the sand; if you fail to engage at public consultation stage, it could be used against you at a later date.

Once a local authority decides it is going to use powers of CPO, you will be notified if your property is affected. It is important to take professional advice at this stage, particularly if you occupy the property on an informal basis.  Professional advice should not cost you a penny, because the acquiring authority is expected to pay for reasonable, professional fees on behalf of the claimant to cover valuers and solicitors.

You will be given a date (usually around six weeks after the Notice) by which any objection must be made in writing to the Planning Inspectorate, an independent body which deals with Public Inquiry in CPO in England and Wales. Crucially, the objection must focus on the scheme – whether it benefits the local area, if there is a commercial demand for the proposed new use, any deliverability alternatives etc - and not relate to the issue of compensation. The Planning Inspectorate will consider any objections and produce a report before a final ruling is made by the appropriate Government minister.

In parallel to any CPO, the acquiring authority is under a duty to engage with any individuals that are affected by the scheme. Their aim is to move businesses without the need to resort to a CPO so do not ignore them; engage with them, but be realistic. This is not a winning lottery ticket and many businesses lose out because their expectations are unrealistic.

When it comes to quantifying your claim, seek professional help – but beware, because anybody can claim to be a compensation specialist without regulation. The Compulsory Purchase Association offers a list of members by region and is a good place to find expert, professional support and my advice would always be to ask how many compensation cases they have dealt with in the last five years.

The principle of compensation is to provide equivalence – nothing more and nothing less. However, if you enlist professional help, you engage with the local authority and you have a good, viable business, you should be able to come out of a CPO slightly better off. For example, it is very difficult to move a small factory to ‘second-hand’ premises – moving to new facility should add some benefit for the business, whether it is improved connectivity, updated electrical wiring or better insulation.

Be sensible, be pragmatic and, most of all, be honest with your advisor. Engage from the start, don’t be greedy and take the professional advice that the acquiring authority are paying for. If you do all of that, you should come out on top, despite the stress of the situation.

Click here to read more on Compulsory Purchase.

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Compulsory Purchase

Our industry leading team have a wealth of experience in dealing with compulsory purchase cases and we provide our first class services across the UK. If you have received a compulsory purchase order then we will guide you through the complicated process. Our team has experience dealing with a wide range of compensation claims and we will work with you to ensure you receive a fair compensation settlement. If you are applying powers, we will work with your team to provide advice throughout the project lifecycle to ensure that your scheme finishes on time and with minimal delays.

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Services for the claimant

We know compulsory purchase orders can be stressful for businesses and individuals. Our dedicated team are highly skilled in acting for claimants, and will give you support and honest advice throughout the process. The services we provide include: Advice on planning objections to Compulsory Purchase Orders Expert evidence to public enquiries Advice on Certificates of Alternative Development Acquisition of alternative premises including accommodation works Estimation of compensation, values, disturbance, value of goodwill Negotiation of Claims Expert evidence of Lands Tribunal   Claimants are guided on the objection process, pre scheme losses, compensation, extinguishment of business, ransom and development value, relocation, certificates of alternative use. Claims are written, negotiated and expert evidence given in the Upper Tribunal (Lands Chamber). When promoting schemes for promoters, we provide the calculation of compensation budgets compliance with Circular 06/04, presentation of expert evidence at Public Inquiry, negotiation of all aspects of compensation and expert witness in the Upper Tribunal (Lands Chamber). Contact Us

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Case Study: Compulsory Purchase Order rejected in its entirety

Jewson are the UK’s leading chain of building merchants, with over 600 branches across the UK they supply building equipment, timber and building products and materials. We successfully assisted Jewson builders’ merchants brand in rejecting, in its entirety, a compulsory Purchase Order (CPO) placed on one of its outlets in Grantham.  

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