Public Works Act 1981
If the government or local authority wants to acquire your land for what they call public works, you’re entitled to a range of compensation payments under the Public Works Act 1981. This article gives an overview on the various entitlements available to you during the acquisition process.
If your land is required for public works such as a new road, a dam, sewerage scheme or similar, the acquiring authority may take that land either by agreement with you, or by compulsory taking of your
land. Whichever method is used to acquire the land, you’re entitled to full, and fair, compensation. This is assessed on an objective, not a subjective basis.
The legislation states that only the owner may make a claim for compensation; however the definition of ‘owner’ extends to anyone who is occupying that land whether by lease, licence or a life tenancy.
Compensation: market value
Your compensation is calculated by assessing the amount the land would be expected to sell for if it were sold on the open market, by a willing seller to a willing buyer, on a specified date.
The question to be determined therefore, is the price that the land would obtain on the hypothetical open market. The subjective personal or emotional value of your property, or the value of the land, to the acquiring authority wanting to buy the land isn’t relevant to the question of value.
Compensation should be fair and reasonable and equivalent to, but not more than, any loss you’ve sustained. You shouldn’t receive compensation of such an extent that you end up in a substantially
better position than you were at the date your land is taken or acquired. So there’s no holding the acquiring authority to ransom!
In determining the market value of the land, you will be able to recover from the acquiring authority the reasonable costs of the professional advice that will be needed to negotiate and determine value, and your agreed compensation.
Disturbance payments
As well as compensation for land that is taken, you’re also entitled to what the Act calls ‘disturbance payments’. These payments cover all reasonable costs you incur in having to move from your acquired
land to a new location. As well as your legal and valuer’s fees (as mentioned in the above paragraph), these could also include the cost of moving your household effects to your new property.
Compensation for business loss
If you’re a business owner, you’ve scope to claim compensation for disturbance to your business as well as a more general right of compensation for business-related loss.
Your losses must be a natural and reasonable consequence of the acquisition or taking, and you can recover the expenses of finding a new business premises, relocating, loss of profit and loss of goodwill.
Acquisition by agreement vs by compulsion
By agreement
You may of course agree to sell your land to the acquiring authority. In this case both parties must negotiate and agree on the appropriate terms and conditions including the amount of the compensation that’s available under the Act. It’s important to ensure that as much detail as possible, as to the type and extent of the compensation, is encapsulated in the signed agreement.
If you agree to the acquisition of the land but not the compensation that’s being offered by the acquiring authority, the Land Valuation Tribunal may be used to decide your compensation.
Compulsory acquisition
Where voluntary agreement can’t be reached on the purchase of your land, the Act provides for compulsory acquisition by the acquiring authority through the Minister of Lands. This power should
only be exercised after the acquiring authority has made every endeavour to negotiate with you in good faith, but without success.
If the acquiring authority initiates steps to take your land, you may object under the Act. If you object to the acquisition, you have the right to have your reasons for such objection heard by the Environment Court.
Get professional help
There’s a range of compensation options available if your land is required for public works. To get the most value from the process, make sure you engage valuation and legal professionals who are
experienced in Public Works Act compensation matters. This will considerably enhance likely compensation outcomes.
