What is a compulsory purchase order (CPO)?
In providing services and facilities for the public, the government is often required to possess land and other property from individuals. A compulsory purchase order is a legal arrangement that allows the authorities the resources they need from members of the public. The authorities get most of the land used for the benefit of the general public through this method.
CPO has been applicable in Ireland since an Act of Parliament was passed in 1757. A lot of infrastructures available in the country were constructed under the provisions of the law. The CPO law formed the basis of the Wide Streets Commission which was responsible for the construction of Dublin streets such as College Street, Dorset Street, and Capel Street among others. Other public utilities such as canals have also been developed with the aid of this law. For many people, the law seems to be draconian, but its powers have made it possible to have many infrastructure projects that benefit the entire nation.
What do I do if I am served with a compulsory purchase order?
Property owners who get served with a CPO deserve compensation for their land or other resources. In the event you are served with a CPO, the first step is to get in touch with a chartered valuation surveyor with the necessary experience in this area. The land engineer will advise on the best way to deal with the notice and how to prepare your claim for compensation. People served with a CPO should seek the services of a qualified surveyor and later claim the cost as part of the common compensation claim.
When pursuing a CPO, the law aims at maintaining the affected persons in the same position of life as they were before. Apart from being compensated for their property, they also get compensation for the disruption of their normal lives. The following are the principal issues that arise from a compensation claim under CPO.
- Compensation for the property acquired is based on their market value
- The Principle of Equivalence is applied. This rule dictates that the affected persons be left in the same financial status as they were before the CPO was implemented
- The amount of compensation should have a reflection of the value of the actual property acquired and its diminution in value where applicable, of the part retained by the owner after the CPO.
The Process of Compulsory Purchase
- The relevant statutory body makes the decision for a CPO
- The parties to be affected by the CPO are notified after the authorities conduct a survey of the area of interest. Since the matter is of public interest, the intention is published in newspapers. The notice states that the order is planned to be put on public display and for submission to An Bord Pleanala for confirmation.
- Objection to the proposal may then be made. The main areas of objection are in planning and legal grounds.
- The next step is to hold a Public Local Inquiry which accepts objections from the affected parties. In case of no objections, An Bord Pleanala can confirm, reject, or amend the CPO without forming a Public Inquiry.
- An Bord Pleanala either confirms, amends, or rejects the CPO and publishes its reasons for its decision.
- Once the period designated for objections is over, the CPO becomes operational.
- The Acquiring Authority then serves the affected people with Notice to Treat which is followed by discussions about the level of compensation to apply.
- Those affected by the CPO then file their claims of compensation. They can appoint a surveyor to prepare and file their claim.
- If the parties agree on the compensation, then payment is made. If no deal is reached, either of the parties can escalate the matter to the Property Arbitrator who will assess the adequacy of the compensation in dispute.
- When all parties get satisfied, the acquisition is finalized and compensation paid.
How is compensation determined and how do I claim it?
When the Acquiring Authority prepares compensation for the people affected by the CPO, it gets guidance from 17 specific laws as laid out by legislation of the land and case law as applicable. The assessment of due compensation is done by a chartered valuation surveyor with the relevant experience. The property assessor is responsible for computing the amounts payable and negotiates on behalf of the affected people. The idea of the assessment is to ensure victims get their rightful compensation.
The computation of the amount payable is based on various issues as follows;
- Value of target land or other resource
- Loss of value of any property not acquired
- Expenses incurred by the owners because of the acquisition
- Loss of income, profits, and goodwill
- Loss of value of items of trade held for resale
- Professional fees incurred during the acquisition.
The acquiring authority is responsible for paying valuation and legal fees incurred by the claimants. However, they pay only reasonable fees in this regard. Often accommodation works such as walls, fences, and drainage systems may be included in the compensation claim.
Terms for easy reference
Notice to treat
This notification is served to all those affected by the CPO, and it requests them to submit their compensation claims.
Notice of entry
This announcement comes from the Acquiring Authority to inform the owner of the intention to enter the land or other resources. It can take place before the agreement and payment of compensation. The notice allows the Acquiring Authority to enter the ground and start the planned development.
In some cases, an Acquiring Authority may require just part of a parcel of land. The value of the property not acquired will have its value reduced from what it was before the partial acquisition. When this happens, the affected person will get compensation on the acquired land as well as that whose value has dropped.
The value of the land may suffer from the developments implemented on the acquired areas. For instance, if the acquired land is used for a sewerage treatment plant, the value of the neighbouring property will deteriorate.