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Everything You Need to Know About Compulsory Acquisition Compensation

Acquiring authorities are allowed by law to acquire land on a compulsory purchase to carry out projects that are in the public interest. Among the projects for which an acquiring authority may acquire your land or property are road widening, new roads or installation of any other public infrastructure. In such instances, the government will issue a compulsory purchase order (CPO) to the ‘qualifying persons’.

 Who qualifies for a compulsory acquisition order?

Any person affected by any order requiring the acquisition of land is a ‘qualifying person’. This includes;

  • Every landowner, leaseholder, occupier and tenant of any land included in the CPO.
  • Any other individual with rights attached to the compulsorily acquired land, or whose land value will be reduced by the public project carried on the acquired land

How is the acquisition compensation calculated?

To determine the compulsory purchase compensation, the acquiring authority ought to conduct an open value of the piece of land to be acquired. Some of the factors to consider when determining the compensation payable to the landholders are;

  • The current market value of the land to be acquired – What is the market value as at the date of acquisition? This is the main component of the acquisition claim. The authority should engage a professional valuer to determine your land value.
  • If the authority is interested in acquiring part of the land, they ought to assess the value of the land before and after the acquisition. This rule puts into consideration that the value of the remaining land may be negatively or positively affected by the acquisition.
  • The acquisition compensation should also include any expenses that may be incurred by the landholder in finding a replacement property; for instance, stamp duty.
  • Lastly, the landholders should be compensated for intangible losses inconveniences in finding a new property, emotional connection to the acquired land, comfort of the owner prior to the acquisition order.

The basic rule of compulsory purchase claims is that the landholder should not be any worse or better off financially than prior to the acquisition.

Can you challenge acquisition compensation?

Any person affected by the acquisition order can challenge it if he/she will be in a worse financial position after the acquisition. You, however, need to involve professional valuers and lawyers to reassess the value of your property. The main purpose is to challenge the valuation report of your property. This should, however, be filed as soon as possible.

There may also be expenses that you’ve incurred on the property may not have been included in the compensation. Any additional compensation you may want to seek should, however, have documentary evidence. A reliable lawyer will guide you on how best you can present a strong case.

Have you received a compulsory purchase order? These are some of the things you need to know before you agree to the acquisition compensation. It is also advisable to involve a valuer to determine whether you’ve got a raw deal. Assess the compensation offered to get the best possible outcome.

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