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You are here: BAILII >> Databases >> England and Wales Lands Tribunal >> Bhattacharjee v Blackburn with Darwen Borough Council [2000] EWLands ACQ_10_1999 (30 March 2000) URL: http://www.bailii.org/ew/cases/EWLands/2000/ACQ_10_1999.html Cite as: [2000] EWLands ACQ_10_1999

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[2000] EWLands ACQ_10_1999 (30 March 2000)

ACQ/10/1999

COMPENSATION - limitation - Compulsory Purchase (Vesting Declarations) Act 1981 section 10(3) - advance payment and negotiations on disturbance compensation after 6 years - whether waiver or estoppel prevented acquiring authority from relying on limitation - held that it did not

LANDS TRIBUNAL ACT 1949

IN THE MATTER of a NOTICE OF REFERENCE

BETWEEN DR GAUR BUSHAN BHATTACHARJEE Claimant

and

BLACKBURN WITH DARWEN BOROUGH COUNCIL Respondent

Re: 77/79 Accrington Road, Blackburn

Before: The President

Sitting at Blackpool County Court, The Law Courts, Chapel Street,

Blackpool, Lancashire

on 26 January 2000

Vincent Fraser instructed by Haworth and Nuttall of Blackburn for the claimant

Alan Evans instructed by Catherine Parkinson, Director of Law and Administration, Blackburn with Darwen Borough Council, for the acquiring authority

The following cases are referred to in this decision:

Co-operative Wholesale Ltd v Chester-le-Street DC [1998] 3 EGLR 11

Kammins Ballrooms Co Ltd v Zenith Investments (Torquay) Ltd [1971] AC 850

Lillis v North West Water Ltd [1999] RVR 12

Troop v Gibson [1996] 1 EGLR 1

Lithgow v United Kingdom 1986 6 EHRR 329

Stubbings v United Kingdom (1996) 23 EHRR 213


 


DECISION ON A PRELIMINARY ISSUE

1. This reference concerns a claim for compensation for the compulsory acquisition by the predecessor of the acquiring authority, Blackburn Borough Council, of the claimant's premises at 77/79 Accrington Road, Blackburn. The claimant is a doctor. He bought the premises in March 1966 as his surgery and occupied them for this purpose until on 1 March 1993, following the compulsory acquisition, he moved to new premises. The compulsory purchase order, the Borough of Blackburn Accrington Road (Blackburn) CPO 1987 was made and confirmed in 1987. A general vesting declaration was made on 16 December 1987 and the vesting date was 14 January 1988. The reference to this Tribunal was made on 3 February 1999. The acquiring authority say that the claim is statute-barred because the 6-year limitation period provided for by section 10(3) of the Compulsory Purchase (Vesting Declarations) Act 1981 had long since expired by the time the reference was made. The claimant says that the authority have waived the limitation or alternatively are estopped from relying on it. These contentions constitute the preliminary issue that now falls to be decided.
2. Section 10(3) of the Compulsory Purchase (Vesting Declarations) Act 1981 provides:

"The time within which a question of disputed compensation arising out of an acquisition of an interest in land in respect of which a notice to treat is deemed to have been served by virtue of Part III of this Act may be referred to the Lands Tribunal shall be six years from the date at which the person claiming compensation, or a person from whom he derives title, first knew, or could reasonably have been expected to have known, of the vesting of the interest by virtue of Part III of this Act."

3. There was no agreed statement of facts, but on the basis of evidence that was not contentious and the documents produced I find the following facts. Following the vesting there were discussions and correspondence between representatives of the claimant and of the council concerning compensation and the relocation of the claimant's surgery. In a letter of 6 February 1991 to Steele and Sons, the claimant's solicitors, the council set out proposed terms. They included an amount in respect of compensation for the value of the land taken, a proposal that disturbance compensation should be assessed on the basis of proven loss following relocation, and terms for the purchase of a site for the relocation of the surgery. There was a round table meeting to discuss these proposals on 9 May 1991, and at a meeting on 7 November 1991 provisional agreement was reached on compensation of £35,000 in respect of the value of the premises and the purchase by the claimant from the council of an adjacent cleared site for £7,500.
4. Purchase of the relocation site was completed on 25 March 1992. The claimant began to practise from his new surgery on or about 1 March 1993 and the council took possession of the subject land on 17 June 1993. The possibility of an advance payment had been discussed and referred to a correspondence from at least 1991 onwards, and on 4 February 1994 Mr Honeywell, the claimant's surveyor, made a formal request under section 52 of the Land Compensation Act 1973 for a payment. He wrote to Mr Manley of the Development Services Department:

"I should be grateful if you would take this letter as a formal request for an Advance Payment to be made to Dr Bhattacharjee under s 52 of the Land Compensation Act.

Accordingly we request an Advance Payment of £36,000, being 90% of the minimum anticipated compensation figure."

5. On 11 February 1994 Mr Manley noted:

"Honeywell phoned said £35,000 was agreed on property plus £5,000 disturbance = £40,000 x 90% = £36,000. Steele & Son will send Title details."

6. On 15 February 1994 Mr Manley on behalf of the council's property manager made a report to the housing department. Under the heading "Amount of Compensation" the report said:

"£40,000 (£35,000 market value of interest plus provisionally estimated disturbance compensation of £5,000). Further claim to be submitted by the claimant on completion of relocation based on proven losses."

7. Then against "Additional Remarks" the following was said:

"This report is supplemental to my report dated 26th November 1991 but I understand that the claimant did not wish to claim the advance at that time.

This report is an interim report solely to enable the payment of a 90% advance payment in accordance with the provisions of Section 52 of the Land Compensation Act 1973 as amended by Section 63 of the Planning and Compensation Act 1991.

The advance requests is £36,000 being 90% of the provisionally estimated compensation detailed above. It should be noted however that this does not represent my opinion of value of the total claim.

I assume that you will register the appropriate land charges against the claimants title to note payment of advance compensation.

Your attention is drawn to the vesting date and you are advised that the claimants ability to refer the matter to Lands Tribunal has now lapsed (Section 19(3)) Compulsory Purchase Vesting Declarations Act 1981. You may wish to consider whether you wish to or are able to make any departures from the statutory code of compensation prior to making payment or prior to making any future payments."

8. On 3 March 1994 a principal legal executive of the council wrote to Steele & Sons as follows:

"I enclose herewith cheque in the sum of £36,000 being a Payment in Advance in respect of the agreed compensation on the above property.

I shall be obliged if you will have the enclosed Receipt signed by your clients before returning it to me. A copy is enclosed for your file."

9. On 7 October 1994 Mr Manley, who had heard nothing further from the claimant or his advisers on the subject of compensation, telephoned Mr Honeywell to ask when a disturbance claim was going to be submitted and said that he was proposing to close his file on the matter. He followed this with a letter dated 17 November 1994, in which he said:

"It is now well over 18 months since your client moved to his new premises and I note that I have still not received your detailed claim for compensation despite having requested this on several occasions. I would therefore advise you that unless I receive your detailed claim before 30 November 1994 I will be closing my file on the matter."

10. Mr Honeywell replied by letter dated 21 November 1994 as follows:

"Thank you for your letter of 17 November. I am sure you will understand that the reason I have not submitted a claim for disturbance is that I have not yet received sufficient information from my client. I have written to him again requesting this information.

I note your wish to close the file if you haven't received anything by 30 November but I hope you will recognise that, as far as I am aware at least, it is not possible to impose an arbitrary time limit and if a proper claim is put forward at a later date, it must be considered."

11. Over two years later, on 2 January 1997, Mr Manley, who had heard nothing further from the claimant or his advisers on the compensation claim, reviewed his file and made a note of his estimate of the claim, including fees and interest. He noted:

"Estimated claim based on 'fair' payment - right to refer to LT lapsed now s10(3) CP (VD) Act 1981."

He also noted on the same day that he telephoned Mr Honeywell, who said that he felt he was no longer acting for the claimant. The note continued:

"Said I will be making not negotiable offer, explained s10(3) CPVDA."

12. On 11 April 1997 Mr Taylor of Steele & Son wrote to the council as follows:

"We have again been consulted by Dr. Bhattacharjee to initiate a claim for compensation for the losses suffered by him as a result of the compulsory purchase of his former surgery premises.

Dr Bhattacharjee maintains that as a result of the compulsory purchase many of his patients, on learning that the surgery had to close, will have transferred their names to other Doctors rather than risking finding themselves without medical protection.

Our client's Accountants Messrs Horridge & Lever have inspected the books of account kept by Dr Bhattacharjee and have estimated that as a direct result of the compulsory purchase he lost 1,810 patients on a permanent basis at an estimated loss of income of £18.87 per patient per annum. Messrs Horridge & Lever have therefore calculated that the annual loss of earnings would be £33,933.87 and that this, capitalised over a ten year period, will amount to £339,338.70."

13. Mr Manley replied in a letter dated 6 May 1997 headed "Strictly without prejudice and subject to contract":

"Firstly, I would advise you that on 2nd January 1997 I spoke to Mr Honeywell who advised me that he no longer has instructions to act on behalf of your client. Could you please confirm that this is correct.

I acknowledge that your client's claim for compensation in respect of the Compulsory Purchase has not been finalised and I look forward to receiving your clients itemised claim showing the calculation of the various amounts claimed under the various heads of compensation together with any supporting documentation to substantiate any such amounts. Upon receipt of this I will contact either yourself or your client's appointed agent to discuss the matter further.

Whilst writing, I would advise you that, in respect of 'business losses' I will find it very difficult to accept that any such losses were directly attributable to the aforementioned Compulsory Purchase Order especially given the careful arrangements that were made for relocation of your clients practice to build accommodation only some 15 metres away from your clients former premises on the same stretch of road."

14. No reply was received. On 15 September 1997 Mr Manley telephoned Steele & Son and left a message for Mr Taylor to contact him. On 8 December 1997 Mr Taylor wrote to Mr Manley saying:

"Our client has re-instructed us to pursue the claim for compensation for disturbance, and he has suggested that we seek Counsel's Opinion on the primary issues relating to the Doctor's loss of income stemming from the circumstances of the closure of the former surgery and the move to the new surgery. We should be grateful if you would confirm that the Council remains willing to pay a fair and legal figure in this respect. Please would you let us know whether or not the Council is prepared to contribute 50% of the cost of Counsel's fees provided we can obtain instructions from our client to show the Authority a copy of Counsel's Opinion. Would you also be prepared to consider a situation where the Authority agrees to follow Counsel's recommendations?"

15. On 10 December 1997 Mr Taylor telephoned Mr Manley, whose note records:

"Taylor phoned mentioned S10 (3) CPVD Act apparently prior to elapse of period he had been disinstructed and had engaged other advisors.

Said I will not proceed as he suggests and will write with my suggestions as to how to settle this matter - my earlier letter."

16. On 12 December 1997 Mr Manley wrote to Mr Taylor:

"I refer to my letter dated 6 May 1997 and to your letter dated 8 December 1987.

The Council is not willing to proceed in the manner which you suggest in your letter.

To progress matters, please respond to my earlier letter and provide the information requested therein."

17. Steele & Son wrote to the council on 27 March 1998 and identified two separate heads of compensation - interruption to the practice and costs caused by the relocation. On the first they suggested that the compensation should be quantified as three times the annual loss of £33,933.87 (rather than ten times this figure as had been suggested in their letter of 11 April 1997). On the second they included a schedule supplied to them by the claimant. On 7 July 1998 and again on 10 July 1998 Steele & Son wrote to the council noting the previous payment of £36,000 and asking that the "uncontested balance" should be paid. A legal assistant with the council replied on 15 July 1998 as follows:

"1 The Surveyor's Report dated February 1994 states market value of £35,000 for the buildings plus estimated disturbance of £5,000. An advance payment of £36,000 being 90% of the compensation and 90% of the estimated disturbance has already been paid. You should submit a further claim under S52 of the Land Compensation Act 1973 to The Assistant Director of Technical Services (Property), for the attention of Mr P Manley, to obtain a further advance.

2 Negotiations regarding the claim for disturbance have just been reopened."

18. Subsequent correspondence related to the claim for loss of practice income. The council requested further details and suggested that no significant loss could be attributed to the move. Steele & Sons continued to assert that substantial numbers of patients had been lost because of it. Notice of reference to this Tribunal was given by the claimant on 3 February 1999, and the authority immediately asserted that the claim was statute-barred.
19. For the claimant Mr Vincent Fraser called the claimant himself and two of his professional agents, William David Honeywell FRICS of Honeywell, Chartered Surveyors and Estate Agents, and John Michael Taylor, solicitor of Steele & Sons.
20. Dr Bhattacharjee said that John Kenyon of Messrs Mortimer Gorse & Ross, surveyors of Blackburn, was originally instructed to act on his behalf in relation to the acquisition. Mr Kenyon carried on negotiations with the council. Mr Kenyon advised him to accept an offer that the council had made, but he did not agree. Mr Kenyon, he said, then simply gave up and did not ask to be paid for his services. Steele & Son had acted for him throughout, up to August 1989 in the person of William Greenwood and after that Mr Taylor. It was Mr Taylor who suggested that Mr Honeywell should be engaged as surveyor to replace Mr Kenyon. Dr Bhattacharjee referred to the negotiations and the move to new premises. He said that in 1997 he had become so concerned about the situation that he raised it with another solicitor, Mr Isaacson of Messrs Aubrey Isaacson of Prestwich, who warned him that there could well be a time limit within which a claim should be submitted, and he accordingly mentioned this to Steel & Son. It was not, however, until late 1998 that he was advised that there was any time limit. He himself had been in touch with the council direct throughout the proceedings and he was always told that they would meet his reasonable claim for compensation.
21. In cross-examination Mr Bhattacharjee agreed that no one had mentioned a possible reference to the Lands Tribunal in the event that negotiations should fail. The information he had supplied to his accountants was that contained in a letter they had written on 24 June 1994 addressed "To whom it may concern." In this the accountants, Horridge & Lever, said:

"The fall in my client's patient list is from a total of 4806 patients to 2996 (a loss of 1810 patients). In my opinion the most accurate basis on which to compute my client's financial loss is to divide his present annual net income by the number of patients he now has and then multiply that by the 1810 patients he has lost. I would estimate that the loss computed in this way would be in the region of £25000 per year."

A later similar letter dated 9 November 1995 contained the accountants' assessment of the loss of profit per patient as £18.74. Both these letters, said Dr Bhattacharjee, he passed on to Mr Taylor.

22. Mr Honeywell said that he had received instructions in early 1991 to advise the claimant. Previously another surveyor had been involved. He referred to the negotiations with the council and to the correspondence. At the time of the advance payment in March 1994 he was waiting for information from the claimant to enable him to put forward his claim for compensation. He had asked him for his receipts but had received no reply. He said that in none of his discussions with Mr Manley or any other representative of the council was the issue of a reference to the Lands Tribunal made. In cross-examination he agreed that at no stage did anyone from the council say that they would not take the limitation point. He said that he understood the limitation period to be 6 years but did not know the particular statutory provision. His understanding was that, provided the acquiring authority showed themselves to be prepared to continue negotiations, infinite extension was possible. He did not assume that the council shared a similar assumption, and he wanted to avoid raising the matter with them.
23. Mr Taylor gave evidence of his involvement with the negotiations. He believed that the council's officers always maintained an attitude that normal and fair compensation would be paid and that figures had been carried forward in the council's budget to meet the liability. He thought, however, that their attitude changed when the diminution in patient numbers was brought to their attention and that, although they were prepared to pay the relocation costs, they disputed that the council was responsible for the reduction in patient numbers. He said that he could not recall the telephone conversation which Mr Manley's notes recorded as having taken place on 10 December 1997. In cross-examination he said that the present case had been his only involvement with compulsory purchase. He said that he knew there was a limitation period and he believed the period to be 6 years. He had no express indication that the council would not take the limitation point. He thought that the willingness of the council to negotiate meant that the matter could always be referred to the courts if there was no agreement.
24. For the acquiring authority Mr Alan Evans called David Cocker who, between 1978 and 1995, had been employed by Blackburn BC as Clearance Manager, in the Borough Solicitor's department up to 1992 and in the housing department from 1992 to 1995; Paul Tomlinson, who had been employed by the council for 34 years, for the past 3½ years as Housing Standards Manager; and Peter Manley BSc, ARICS, who, between 5 June 1989 and 14 August 1998 had been employed by the council as group valuation officer, and later as principal valuer.
25. Mr Cocker said that it was to him that Mr Manley reported in 1994 on the matter of the advance payment and whether the file should be closed. He said that he had never discussed with the claimant or his agents any extension of time limit for making a reference to the Lands Tribunal. In cross-examination he said that his response to Mr Manley in 1994 had been that if a claim was submitted it should be dealt with in the normal way. That was the normal practice. They were always willing to keep a file open. His understanding was that it was the council's responsibility to pay compensation.
26. Mr Tomlinson said that he had had no relevant responsibility before taking up his present post 3½ years ago. Since then he had been responsible for the administration of the council's clearance programme and the authorisation of compensation payments. He had never spoken to the claimant or his agents. He had taken over from Mr Cocker. In cross-examination he said that if he had been asked about the limitation point he would have said that it would not be taken, and that the council would continue to negotiate.
27. Mr Manley gave evidence of the negotiations to which he had been a party as the council's agent. He said that he was throughout fully aware of the limitation period and had drawn it to the attention of the Housing Department in relation to the advance payment of compensation in February 1994. Despite this he was instructed to continue with the negotiations. As a matter of practice he did not refer in negotiation to the limitation period because he thought it would be counter productive. His approach was only to mention limitation once he became aware that litigation was being considered. He would, however, mark correspondence after the lapse of the limitation period "Strictly without prejudice". As far as he was aware the council had no formal policy on its approach to compensation claims outside the limitation period. He himself made no express waiver of the limitation period. In cross-examination he agreed that he was at no stage instructed to take the limitation point. His view had been that the council would pay a fair measure of compensation, but would not necessarily agree to a Lands Tribunal reference. His approach was always to negotiate in order to reach an amicable settlement, on the basis that limitation did not extinguish the right to compensation but merely the right to have it determined by the Lands Tribunal.
28. Mr Fraser submitted that the 6-year period provided for by section 10(3) of the Compulsory Purchase (Vesting Declarations) Act 1981 expired on 14 January 1994, 6 years after the vesting date. Section 19(3) was a procedural provision capable of being waived or the subject matter of an estoppel; and he relied on Co-operative Wholesale Ltd v Chester-le-Street DC [1998] 3 EGLR 11, Kammins Ballrooms Co Ltd v Zenith Investments (Torquay) Ltd [1971] AC 850, Lillis v North West Water Ltd [1999] RVR 12 and Troop v Gibson [1996] 1 EGLR 1. Those authorities established, he said, the following propositions. Firstly, where both parties proceed on the basis that they are negotiating a settlement of a valid claim for compensation without regard to the statutory limitation period, they will be estopped from going back on that when it is unfair or unjust to do so. Secondly, the crucial requirement for estoppel by convention is that both parties should be of like mind, but clear and unequivocal statements are not required. Thirdly, an invitation to resume negotiations after the expiry of the limitation period amounts to an assurance or representation that it will not be relied upon as a time bar, which if acted upon gives rise to a promissory estoppel. Fourthly, pursuit of negotiation and making of offers in knowledge of the limitation period having expired amounts to a waiver of the limitation period.
29. Mr Fraser also submitted that the taking of property without payment of an amount reasonably related to its value would normally constitute a disproportionate interference which could not be considered justifiable under Article 1 of the First Protocol to the European Convention on Human Rights; and he relied on Lithgow v United Kingdom 1986 6 EHRR 329. The common law should be interpreted so far as possible to conform with the principles of the convention.
30. Mr Fraser reviewed the negotiations. He said that initially they centred on the issue of the acquisition by the claimant of land for a replacement surgery, and the land was not acquired until 25 March 1992. The acquiring authority's position was that the disturbance element of the claim should not be settled until after the physical transfer of the medical practice. In practical terms that would require a period of time after transfer to enable the practice to settle down and to allow for a proper assessment of the consequences of the transfer. The transfer of the practice did not occur until 1 March 1993. By that time only 10 months remained of the period under section 10(3). Given the need for further time for assessment it would have been unrealistic to expect a settled claim within the section 10(3) period. The value of the property was finally agreed on 11 February 1994 i.e. after the 6-year period under section 10(3). The advance payment was sought on 4 February 1994 (after 6 years) and made on 4 March 1994 in the full knowledge that the 6-year period had expired. This alone, said Mr Fraser, would be sufficient to found either a convention or a promissory estoppel and waiver.
31. In November 1994 the acquiring authority's valuer indicated that if full details were not provided by 30 November 1994 the file would be closed. The claimant's agent responded by stating that a time limit could not be imposed. The acquiring authority did not respond to this statement, but it was clear, said Mr Fraser, from the internal memos that the authority intended to continue to negotiate after 30 November 1994 even though it was fully aware of the implications of section 10(3). This alone, he said, would be sufficient to found either convention or promissory estoppel and waiver. In December 1997 the acquiring authority raised the issue of section 10(3) with the claimant's solicitors but then proposed that the matter should proceed by the claimant providing the outstanding information. That again, he said, was the clearest possible evidence for an estoppel and waiver. Thereafter there was a further year of discussion, negotiation, and request for information from the acquiring authority. In the course of that year the acquiring authority's solicitor became involved, and even invited a further application from the claimant for an advance payment. Whilst points were taken about the merits of the elements of the claim it was never suggested that the claim was time-barred. Thus, Mr Fraser said, the parties proceed at all times on the basis of a common assumption that they were negotiating settlement of a valid claim for compensation without regard to the statutory limitation period on the basis that if agreement could not be achieved the matter would in the last resort be referred to the Lands Tribunal for determination. It would be unconscionable to allow the authority to rely upon limitation now. The authority encouraged and enticed the claimant to pursue negotiations on the basis of a valid claim.
32. Mr Evans said that certain basic points were clear from the evidence. There was never any express assurance by the acquiring authority at any time that it would not rely on limitation, nor was there any suggestion by them that if negotiations failed recourse could be had to the Lands Tribunal. The time limit point was taken as soon as proceedings were commenced. The mere fact that the Council had not said previously that it would take the limitation point could not without more give rise to an estoppel: not saying that the point was going to be taken was not an assurance that it would not be taken.
33. If the council were to be estopped by convention, Mr Evans submitted, the required assumption would have to involve the common element that if agreement on compensation was not reached there would be a reference to the Lands Tribunal. This was never the assumption of the council, their agent Mr Manley was aware of the expiry of the time limit and assumed no more than that he was engaged in an attempt to agree compensation outside the limitation period. Even if there was an agreed assumption to the required effect it would not be unconscionable to give effect to it because the claimant had already received sufficient measure of compensation in the form of the advance payment (so that it was not a case of expropriation without any compensation) and he had been extremely dilatory in moving the matter forward. Promissory estoppel required a clear and unequivocal promise or assurance. The council's conduct, said Mr Evans, did not meet the required standard in this respect. The making of the advance payment was a payment of 90% of the minimum anticipated compensation figure. It could not be said that there was contained within the act of making that payment any commitment to a process of final determination by the Lands tribunal. The asking for further information and re-opening of negotiations was explicable on the basis that the council would (as they were entitled to do) make a further payment as a matter of discretion if the requisite information from the claimant was made available. Nor, said Mr Evans, was this a case of waiver by way of election between inconsistent alternative rights. An election to seek to agree a settlement even though there is no enforceable obligation so to do once limitation is passed does not amount to an election not to rely on the time limit.
34. Although nothing, in my judgment, in the present case turns on whether it was the date of the general vesting declaration (16 December 1987) or the notice of vesting (17 December 1987) or the vesting date (14 January 1988) from which time runs for the purposes of section 10(3), it appears to me that the correct date to take is the date of vesting. What the provision requires, in my view, is knowledge (or constructive knowledge) on the claimant's part that the interest has vested in the acquiring authority rather than that it is going to vest at a future date. Thus 14 January 1988 is the material date in the present case, so that the limitation period expired on 14 January 1994.
35. The case for the claimant is based, as I have said, on promissory estoppel, estoppel by convention and waiver. There is no dispute on the nature of each of these legal concepts. It is, I think, sufficient for present purposes to note firstly that the constituents of estoppel by convention are expressed in similar fashion in a number of cases, and that the particular authority relied on by Mr Fraser (Troop v Gibson) is in my view consistent with others that have been relied on in other cases similar to the present one. Estoppel by convention arises where both parties have engaged upon a course of negotiations or transactions representing mutually the one to the other that a certain state of affairs is accepted as regulating their conduct ([1986] 1 EGLR 1, per Purchas LJ at 5H and Ralph Gibson LJ at 6D). A party may not act outside the terms of the convention thus established if it would be unconscionable for him to do so. Secondly, the type of waiver relevant to the present case is that referred to by Lord Diplock in Kammins Ballrooms Co Ltd v Zenith Investments (Torquay) Ltd [1971] AC 850 at 883C:

"The second type of waiver which debars a person from raising a particular defence to a claim against him, arises when he either agrees with the claimant not to raise that particular defence or so conducts himself as to be estopped from raising it. This is the type of waiver which constitutes the exception to a prohibition such as that imposed by section 29(3) of the Landlord and Tenant Act, 1954, and other statutes of limitation. The ordinary principles of estoppel apply to it."

36. Whether estoppel or waiver arises depends on the facts in the particular case. Previous decisions of this Tribunal to which reference was made (Co-operative Wholesale Ltd v Chester-le-Street DC and Lillis v North West Water Ltd) were decided on their own particular facts. Before considering the facts in the present case it, I think, right to make one general observation. The effect of section 10(3) is to deprive the claimant of the right to refer the question of compensation to the Lands Tribunal once the 6-year period has expired. It does not, in my judgment, affect the power of the acquiring authority to agree and to pay compensation. Thus the mere fact that claimant and acquiring authority negotiate on compensation after the lapse of the limitation period will be insufficient to establish the convention that the negotiations are on the basis that either party may refer the issue of compensation to the Lands Tribunal if agreement cannot be reached. The mere fact of negotiation could be consistent with the potential exercise by the authority of its power to pay compensation and its reservation of the question of limitation. Evidence going beyond the mere fact of negotiation will be required in order to establish an estoppel or a waiver.
37. An important feature of the present case is that an advance payment under section 52 of the Land Compensation Act 1973 was requested and made after the expiry of the limitation period on 14 January 1994. Section 52 (so far as material) provides:

"(1) Where an acquiring authority have taken possession of any land the authority shall, if a request in that behalf is made in accordance with subsection (2) below, make an advance payment on account of any compensation by them for the compulsory acquisition of any interest in that land.

(3) Subject to subsection (6) below, the amount of any advance payment under this section shall be equal to 90 per cent of the following amount, that is to say -

(a) if the acquiring authority and the claimant have agreed on the amount of the compensation, the agreed amount;

(b) in any other case, an amount equal to the compensation as estimated by the acquiring authority.

(5) Where the amount, or aggregate amount, of any payment under the section made on the basis of the acquiring authority's estimate of the compensation exceeds the compensation as finally determined or agreed, the excess shall be repaid; and if after any payment under this section has been made to any person it is discovered that he was not entitled to it, the amount of the payment shall be recoverable by the acquiring authority."

38. Mr Honeywell made his request for an advance payment on behalf of the claimant by letter on 4 February 1994. He and Mr Manley spoke on the telephone on 11 February 1994 and agreed the basis on which the payment would be made. The necessary authority for payment was given. On 3 March 1994 the payment was sent under cover of a letter from a legal executive saying that it was in respect of the agreed compensation. I have set out above the material parts of these two letters. In my judgment the effect of these exchanges was to establish an enforceable agreement that the value of the land taken was £35,000 and that the council would pay in addition to this amount such disturbance compensation as the claimant was entitled to. Since the payment was expressed to be made under section 52 it was implicit that if agreement could not be reached on the amount of disturbance compensation the matter would have to be "determined" (see s52(5)); and this meant determined by the Lands Tribunal in accordance with section 1 of the Land Compensation Act 1961. At the time of the agreement the 6-year limitation period under section 10(3) had already expired, and thus the effect of the agreement was necessarily to disable the council, to some extent at least, from relying on the limitation. The question, however, is: to what extent? It does not seem to me that in agreeing as they did the council were waiving for all time the limitation period. It was no part of the agreement that the claimant could at any time at all, possibly many years later, submit his claim for disturbance compensation and make a reference to the Lands Tribunal. There is necessarily to be implied in the agreement, in my view, a term that any such claim must be made, and any proceedings for its determination must be commenced, within a reasonable time. That was the limit of the waiver. In order to quantify his disturbance claim the claimant needed to establish the fall off in patient numbers that was attributable to his dispossession. What was a reasonable period for the submission of the claim must depend upon this. There was a need, as Mr Fraser put it, to establish the settled-down number of patients at the new surgery.
39. I attach no significance to the exchange of letters 10 or so months later in November 1994, when Mr Manley said that unless he received a detailed claim before 30 November he would close his file, and Mr Honeywell said that, as far as he was aware, it was not possible to impose any time limit. Mr Honeywell misunderstood the position. As his evidence made clear he was not aware of section 10(3). I do not think that it is possible to conclude from the fact that Mr Manley did not reply in order to correct Mr Honeywell's misapprehension that the council were content to proceed on the basis that no limitation period applied. There was no agreement on the point and no indication at all from Mr Manley that he was approaching the matter on the same basis as Mr Honeywell.
40. The next communication on the part of anyone instructed to act as the claimant's agent did not occur until 11 April 1997, when Mr Taylor wrote to Mr Manley to say that he had "again been consulted by Dr. Bhattacharjee to initiate a claim for compensation for the losses suffered by him as a result of the compulsory purchase of his former surgery premises." This was over 4 years from the date (1 March 1993) when the claimant had opened his new surgery. By that stage, in my judgment, the reasonable time within which the disturbance claim had to be made had expired. The patient numbers referred to in Mr Taylor's letter were those from the accountants' letter of 24 June 1994; while the profit per patient figure came from the accountants' letter of 9 November 1995. The other element of the disturbance claim, removal expenses, could undoubtedly have been quantified at the time, or soon after, the expenses were incurred. The claim could clearly have been made long before 11 April 1997.
41. Mr Taylor said, and I accept his evidence on this, that he was aware that there was a limitation period and he thought that it was 6 years. I do not think that he could have taken Mr Manley's response to his letter of 11 April 1997, headed as it was "Strictly without prejudice and subject to contract", as an indication that the council would not relying on the limitation period. He accepted that he had had no express indication that the council would not take the limitation point. For his part Mr Manley had deliberately headed the letter as he had because he was concerned that the limitation point might need to be taken. Some months later, in the telephone conversation of 10 December 1997 which Mr Manley's note records, Mr Taylor and Mr Manley discussed section 10(3) and the lapse of the 6-year period. Mr Taylor said that he could not recall this conversation. I am satisfied that limitation was identified as a live issue by Mr Manley, although he did not say either that council would or that they would not take the limitation point.
42. From these exchanges, and from the later one that I have previously referred to, I find no evidence later than the letters in February and March 1994 that the parties were acting upon a common assumption that a dispute as to compensation could be referred to the Lands Tribunal. Neither Mr Taylor nor the claimant had any reason to believe, or did believe, that the council would not take the limitation point. I do not think that the letter of 15 July 1998 from a legal assistant with the council, in which it was suggested that the claimant might make a further claim for an advance payment, had any effect on the basis upon which the claim was being discussed. It was clearly written in error, since the request from Steele and Son had nothing to do with a further advance payment. What they had asked for was payment of the "uncontested balance" of the £40,000, the 10%. Finally, no significance in my view attaches to Mr Tomlinson's agreement in cross-examination that if he had been asked about the limitation point he would have said that it would not be taken. He was not asked about the limitation point, and I have found that neither Mr Taylor nor the claimant had any reason to believe, or did believe, that it would not be taken.
43. For completeness I should deal with Mr Fraser's submission that the taking of Dr Bhattarcharjee's property without the payment of an amount reasonably related to its value would be in breach of Article 1 of the First Protocol of the European Convention on Human Rights. The limitation of actions is not in itself a breach of the Convention, which recognises the appropriateness of reasonable time limits on the pursuit of claims: see Stubbings v United Kingdom (1996) 23 EHRR 213. In the present case the claimant has had, in my judgment, a reasonable opportunity to pursue his claim, which is now statute-barred as the result of unreasonable delay on his part.
44. Accordingly, I conclude that at the date of reference the claim was statute-barred and that no waiver or estoppel operated so as to prevent the council from relying on the limitation provision of section 10(3). The preliminary issue is decided in favour of the acquiring authority. This decision accordingly disposes of the proceedings. It will take effect as a decision when the question of costs is decided and at that point, but not before, the provisions relating to the right of appeal in section 3(4) of the Lands Tribunal Act 1949 and Order 61 rule 1(1) of the Civil Procedure Rules will come into operation. The parties are invited to make submissions as to the costs of this reference and a letter accompanying this decision sets out the procedure for submissions in writing.

Dated 30 March 2000

(Signed) George Bartlett QC, President

ADDENDUM ON COSTS

The respondent applies for an order that its costs, including the costs of the hearing on 6 May 1999, which was adjourned so that the parties could exchange documents and witness statements, should be paid by the claimant. This application is resisted by the solicitors who now act for the claimant. They argue, firstly, that it was not the fault of the claimant but of his professional advisers that he lost his opportunity to pursue his claim through the Lands Tribunal; secondly that the council were inconsistent in being prepared to make a reasonable payment in respect of the claimant's loss yet seeking to have these proceedings struck out; thirdly, that given the conclusion that the agreement of February and March 1994 contained a waiver for a reasonable time of the council's right to rely on the limitation, it was reasonable fore the claimant to contest the preliminary point; and fourthly that the claimant is a member of the general public who has been forced to contest these proceedings against a local authority.

There is no substance in any of these arguments. If it is right that it was the fault of the claimant's former advisers that the claim became time-barred and the council succeeded on the preliminary issue, that is not a reason to deprive the council, as the successful party, of their costs. It is a matter between the claimant and his former advisers. Nor was there any inconsistency on the council's part in the stance they adopted in resisting the Lands Tribunal claim but being prepared to pay a reasonable sum as compensation. They were fully entitled to adopt this position. On the third point, the conclusion - that the reasonable time within which the claimant might make a reference had expired - went against the claimant, and there is no justification for depriving the council of its costs. Finally there is nothing in the status of the claimant in relation to that of the council that makes it inappropriate that he should pay their costs. Accordingly the claimant will pay the respondent's costs of the reference. Such costs, if not agreed, will be the subject of a detailed assessment on the standard basis by the Registrar of the Lands Tribunal in accordance with Rule 44.4 and Rule 44.7 of the Civil Procedure Rules. The procedure laid down in Rule 52 of the Lands Tribunal Rules 1996 will apply to such detailed assessment.

Dated 16 May 2000

(Signed) George Bartlett QC, President