Property Acquisition. A guide to DPTI s acquisition process under the Land Acquisition Act 1969

Transcription

1 Property Acquisition A guide to DPTI s acquisition process under the Land Acquisition Act 1969

2 Prepared by: Department of Planning, Transport and Infrastructure Level 2, 211 Victoria Square Adelaide SA 5000 GPO Box 1533 Adelaide SA 5001 Telephone: (08) KNet #

3 Contents 1 Property acquisition 3 2 DPTI initiated property acquisition Approved scheme announced Notice of Intention to Acquire Land sent to affected parties DPTI requests access to the property Legal rights under the Land Acquisition Act Explanation of the reasons for acquisition Right to object Right of review Property valuation Offer submitted to affected parties Independent valuation Negotiations Agreement reached Agreement not reached Compulsory acquisition Notice of Acquisition published in SA Government Gazette Payment of compensation into SA Supreme Court Negotiations Matter referred to Court for resolution 10 3 Business interests 11 4 Residential and commercial tenant entitlements 12

4 1 Property acquisition The Department of Planning, Transport and Infrastructure (DPTI) is responsible for providing a safe and efficient road transport system in South Australia. Sometimes it is necessary to acquire property in order to upgrade existing roads or to construct new roads. The Highways Act 1926 gives DPTI the authority to acquire property that is required for road development purposes. The acquisition is carried out in accordance with the provisions of the Land Acquisition Act This document is a general guide to the procedures that are followed when DPTI acquires property for a project that has been announced by Government. The Land Acquisition Act 1969, available from the Parliament of South Australia website at provides further details relating to property acquisition. Information is also available by contacting: Property Directorate Department of Planning, Transport and Infrastructure Level 2, 211 Victoria Square Adelaide SA 5001 Ph: (08)

5 2 DPTI initiated property acquisition This section explains the process of property acquisition under the Land Acquisition Act 1969 and Figure 1 illustrates the possible steps in the process. 2.1 Approved scheme announced Once concept schemes have been assessed and community engagement and environmental impact assessment activities have been carried out, the extent of land acquisition required can be finalised. When the Minister for Transport has given approval to acquire the land necessary to construct the project, the project becomes an approved scheme under the Highways Act 1926 (the enabling Act). This allows DPTI to initiate land acquisition in accordance with the Land Acquisition Act Notice of Intention to Acquire Land sent to affected parties Where land for an approved scheme is required for road construction, DPTI will initiate the formal acquisition process by contacting the owner or registered proprietor of the affected property. Owners will be asked to identify any other people or companies who have a legal or equitable interest in the property (whose names are not registered on the Certificate of Title). DPTI would usually seek a response to the request within 14 days. Examples of a legal or equitable interest are: a registered proprietor, a lessee, an equitable owner, a holder of an encumbrance or worker s lien, a caveator, an executor of a deceased estate, a beneficial owner, a mortgagee, a business operator, native title claimants or holders etc. Someone living on the site as a guest of the owner or tenant is not considered to have a legal interest in the property. A Notice of Intention to Acquire Land will then be sent to every party who has such an interest in the property. The notice informs the affected parties that DPTI intends to acquire their interest in the property and outlines their rights under the Act. Accompanying the notice will be a letter advising each party of their right to seek professional, legal and valuation advice regarding the proposed acquisition. The purpose of serving a Notice of Intention to Acquire Land on each party whose property or interest in property is affected is to ensure that each party is given every opportunity to negotiate for compensation and exercise the legal rights that the Act provides DPTI requests access to the property Accompanying the Notice of Intention to Acquire Land will be a request that the parties grant DPTI the right to enter on to the property so that preliminary construction activities (e.g. survey, soil testing and service location) can be carried out and so that DPTI can make changes to the property to allow access (e.g. installation or removal of gates and fences). If affected parties do not object to the proposed acquisition, the acquisition process continues in Section 3.4 of this document.

6 Figure 1. Process of property acquisition under the Land Acquisition Act 1969

7 2.3 Legal rights under the Land Acquisition Act 1969 Section 3.3 and the purple coloured boxes of Figure 1 explain the legal avenues available if affected parties object to the proposed acquisition or wish to vary the amount of land to be acquired Explanation of the reasons for acquisition Within 30 days after a Notice of Intention to Acquire Land is given, affected parties may write to DPTI requesting an explanation of the reasons for the acquisition and a description of the project for which the property is to be acquired. DPTI may provide the details by letter or by providing models, plans, specifications or other relevant materials that explain the project and the reasons for acquisition. (In many circumstances, community engagement activities or one-on-one meetings will be carried out to notify property owners of the project and the associated property requirements) Right to object Within 30 days or, if the affected parties have requested information regarding the reasons for the acquisition, within 30 days after the explanation is provided, affected parties may write to DPTI requesting: not to proceed with the acquisition of the land; or to alter the boundaries of the land to be acquired; or that a particular part of the subject land not be acquired, or that further land be acquired. The request may be made: on the ground that acquisition of the land or part of the land is not necessary for constructing the project on the ground that acquisition of the land or carrying out the purposes for which the acquisition is proposed would: seriously impair an area of scenic beauty destroy, damage or interfere with an Aboriginal site within the meaning of the Aboriginal Heritage Act 1998 destroy or impair a site of architectural, historic or scientific interest prejudice the conservation of flora or fauna that should be conserved in the public interest prejudice some other public interest on some other ground stated in the request.

8 Any objection to the acquisition is then considered on its merit by DPTI. Senior DPTI representatives whose normal duties are separated from the project will undertake the review. DPTI must respond to an objection within 14 days. If the objection is successful, DPTI will modify the scheme and/or the amount of land to be acquired and negotiations with affected parties will continue on the basis of the revised scheme. (Refer Clause 3.4) Right of review If the objection is unsuccessful, the affected parties may apply in writing to the Minister for Transport for a review of DPTI s decision. (The request for review should be made within 7 days of being served with a notice that DPTI has refused the request, however the Minister may in his or her absolute discretion consider requests that are made after a longer period). On receiving an application, the Minister will conduct the review or will appoint a suitable person to conduct the review on the Minister s behalf. (If the Minister conducts the review, it must be completed within 14 days of receiving the application. If the review is conducted by a person on the Minister s behalf, the reviewer must submit a report to the Minister within 14 days of his or her appointment). On completion of the review, the Minister may confirm, vary or reverse the decision which was the subject of the review. If the Minister s review confirms the decision made by DPTI, negotiations will continue on the basis of the scheme originally proposed. If the Minister s review varies or reverses the decision made by DPTI, the scheme and/or the amount of land to be acquired will be modified and negotiations with affected parties will continue on the basis of the revised scheme. 2.4 Property valuation Once issues resolving the extent of the proposed acquisition are discussed and resolved, DPTI will undertake a valuation of fair and reasonable compensation for each affected parties losses resulting from the acquisition. Compensation is based on the market value of the property or the loss in market value to the property, in the case of partial acquisition. Market value is based on what a similar property might be expected to sell for if sold on the open market by a willing seller to a willing buyer. If DPTI buys only a portion of the property, the effect of acquisition on the rest of the property is taken into consideration. In addition, there is provision for payment of other reasonable expenses actually incurred upon final settlement. Issues that Valuers must consider in determining fair and reasonable compensation for the loss that a party will incur are specified in Section 25 of the Land Acquisition Act. Consideration is given to: the fair market value of the land to be acquired

9 any loss to the remaining land caused by severance or partial acquisition any other loss due to disturbance special value, including any business based issues. These items can include, where applicable, compensation for relocation and purchase of an alternative dwelling of equal value. Businesses that DPTI is partly or wholly acquiring are required to make available trading figures for at least the previous three years, as well as any other documents that support their compensation claim, so that the Valuer can gain an understanding of the business, its operation and its profitability. DPTI may also engage experienced accountants, specialist business brokers or other industry qualified personnel to help gain an understanding of the business and its worth. 2.5 Offer submitted to affected parties Following assessment, DPTI will submit a formal offer to the property owner and other affected parties for their consideration. If the offer is acceptable, the matter will proceed for approval and subsequent settlement. 2.6 Independent valuation Affected parties are entitled to engage a Valuer of their choice to provide a valuation of their loss. DPTI will reimburse affected parties the reasonable cost of obtaining the independent advice. As DPTI may not indemnify affected parties against all such costs, Valuers should discuss their proposed charges with DPTI officers prior to carrying out the valuation. For advice on how to find a suitable independent Valuer please contact the Manager, Acquisitions (contact details can be found on page 2 of this document). 2.7 Negotiations After the independent valuation is submitted to DPTI, negotiations will take place in an attempt to reach agreement regarding compensation. Every effort will be made to negotiate a mutually acceptable agreement Agreement reached If agreement on price and other compensation items is reached, the matter will proceed to settlement and ownership of the property will transfer to the Commissioner of Highways. Issues of property occupancy and right of entry to land for survey purposes will be negotiated at this time, if they have not already been established Agreement not reached If agreement on price and other compensation items cannot be reached, then the Commissioner of Highways may acquire the property by compulsory means under the Land Acquisition Act 1969.

10 2.8 Compulsory acquisition Compulsory acquisition is a statutory process under the Land Acquisition Act 1969, available to DPTI to acquire the land necessary to provide a safe and efficient road transport system. It also provides the legal means for reaching agreement about the amount of compensation payable if an agreement cannot be reached in a negotiated purchase. The general process of compulsory acquisition is explained below and in the teal coloured boxes of Figure Notice of Acquisition published in SA Government Gazette The compulsory acquisition process under the Land Acquisition Act 1969 begins when the Commissioner of Highways publishes a Notice of Acquisition in the South Australian Government Gazette. Once the Notice of Acquisition is published in the Gazette the land belongs to the Commissioner of Highways, but the Commissioner does not have the right to enter on to the land for any purpose unless right of entry to the land has been granted by the property owner. The Notice of Acquisition can only be published three months after the Notice of Intention to Acquire Land was given Payment of compensation into SA Supreme Court Once the Notice of Acquisition is published in the Gazette, DPTI s offer of compensation to each affected party must be paid into the South Australian Supreme Court within 7 days. (DPTI cannot pay its offer of compensation directly to the affected parties). Affected parties may withdraw the compensation amount at any time, without affecting their right to claim further compensation, or may leave the funds in the Supreme Court Suitors Fund until agreement is reached regarding compensation. (If the latter option is chosen, the funds will be invested on behalf of the affected party and will accrue interest that will be paid to the party). The Supreme Court has been quite flexible regarding dispossessed owners lodging claims after publication of the Notice of Acquisition. Claims for business losses are frequently deferred where their full extent may not be known until after construction is complete and the traffic using the road has returned to normality Negotiations If affected parties dispute the adequacy of DPTI s offer, negotiations between DPTI and the affected parties continue. If a mutually acceptable outcome on price and other compensation items is reached, settlement processes are implemented.

11 2.8.4 Matter referred to Court for resolution If the negotiations do not result in a mutually acceptable outcome, either the affected parties or DPTI may refer the matter to Court for resolution and the Court will determine the amount of compensation to be paid. (DPTI will pay reasonable professional fees for all parties). If right of entry to the property has not been previously agreed, DPTI and the dispossessed owner are required to negotiate in good faith. (If agreement regarding entry has not been reached within three months after the Notice of Acquisition has been published, DPTI may refer the matter to Court seeking an Order from the Court permitting entrance onto the land).

12 3 Business interests Any business which is being conducted from a property that is being wholly or partially acquired may have a claim for compensation. This is in addition to any property based compensation consideration. The impact on business interests will vary considerably and all issues will be considered on the circumstances presented. The issue of business related compensation applies to property owners, tenants and other interested parties alike. Businesses are required to make available trading figures for at least the previous three years, as well as any other documents that support the compensation claim, so that an understanding of the business, its operation and its profitability can be gained.

13 4 Residential and commercial tenant entitlements Residential tenants of properties which are to be acquired also have rights and entitlements under the Land Acquisition Act. Generally where a tenant is required to move as a result of an imminent acquisition, they will be entitled to costs of furniture removal and service disconnection and reconnection fees. They will also receive payment for time and effort involved in finding alternative premises and dealing with DPTI. Commercial tenants will be entitled to reimbursement of certain expenses such as reprinting of new letterheads, cost of advising client base of new address, loss of business during the period of relocation etc. Each tenant will be dealt with on an individual basis.