Compulsory purchase orders for listed buildings

Faced with the blight of rundown listed buildings whose owners will not repair them, local authorities are having encouraging experience with issuing compulsory purchase orders.

Problem listed buildings regularly feature on the radar of local authorities. Such buildings are often in poor repair. Sometimes the owner has no plans for the property but wants to hang on to it. Sometimes the owner is happy to sell it, but has unrealistic expectations as to its value.

The first response of the local authority will probably be to encourage the owner either to get on and repair the property himself, or to dispose of it to someone who will. It could be that a notice under Section 215 of the Town and Country Planning Act 1990 will be considered.

While this might result in the appearance of the property being improved, it is unlikely to deal with significant disrepair. There is the possibility, if the building is in a particularly bad way, of the council executing works under Section 54 of the Planning (Listed Buildings and Conservation Areas) Act 1990 (‘the Listed Buildings Act’).

The works covered by Section 54 are those that are urgently necessary for the preservation of the building. Section 55 sets out the procedure for recovering the cost of the works from the owner of the building. Unfortunately, the cost of the works in England are not a charge on the property (they are a charge in Wales). With an impecunious owner many authorities will be reluctant to use their powers under Section 54.

What other options are there? Section 47 of the Listed Buildings Act enables a local authority to compulsorily acquire a listed building where reasonable steps are not being taken for properly preserving it. However, there is a procedural requirement that must be satisfied before you can make your compulsory purchase order. You must first have served a notice under Section 48 of the act and two months must have elapsed. This notice is commonly referred to as a repairs notice.

However, it does not call on the owner to carry out any works. It merely sets out the works required for the proper preservation of the building and explains that the council can make a CPO after two months. The purpose of the notice is as a warning shot across the bows. It gives the owner the opportunity to put to the local authority their own proposals for repairing the property. If they are acceptable, it is unlikely that a CPO will be needed.

Serving a repairs notice does not compel the local authority to proceed with a CPO. Nor does it entitle the owner to force the council to buy the property. Advice on what level of detail to include in a repairs notice is helpfully contained in Historic England’s ‘Stopping the Rot’ document. It may well be that serving a repairs notice is all that is required to get the owner to sort things out himself.

If the repairs notice elicits no response, or an unsatisfactory one, the next weapon in the armoury is the CPO. The three elements of a successful CPO project are a problem, a solution, and compulsory acquisition linking the two. Where you have a rundown listed building that the owner will not repair, the problem is obvious. The solution can be the more difficult part of the equation. The local authority needs to demonstrate that following its acquisition there is a reasonable likelihood of the property being repaired and remaining in that state.

What does a ‘reasonable likelihood’ mean in practice? You need to be able to show that there either is, or is likely to be, someone who will take a transfer of the property following completion of the CPO, and who will have the resources to complete the renovation. The resources do not all need to be secured when the CPO is made or confirmed, but there needs to be a good prospect of them being available within the timescale of the renovation project. The overall test for the confirmation of a CPO is that of a compelling case in the public interest. While this test will be met even if you can only show a reasonable likelihood of the desired outcome being achieved, it is obviously good to have even greater certainty.

Two points. First, you can acquire not only the footprint of the listed building, but also ‘relevant land’. This is defined in Section 47(7) of the Listed Buildings Act. Curtilage land will generally be included within this definition. It can, however, include land next to the listed building that is required for enabling development to subsidise the cost of repairs.

Second, even if there is a conservation deficit (the cost of repairs exceeds the value of the repaired property), the compensation paid to the former owner following the successful compulsory acquisition will not be nil. The Upper Tribunal (Lands Chamber) has established the principle that an entrepreneurial developer will pay something for a property even though this may seem imprudent.

An illustration of the above principles can be seen in four listed building CPOs undertaken by nplaw. Two CPOs were made by King’s Lynn and West Norfolk Borough Council in respect of empty listed houses. They were in poor repair and there had been no response to the repairs notices. Agreements were reached with two individuals who particularly wanted to acquire the houses. They not only agreed to underwrite the CPO costs, but also to carry out the necessary renovations. In one case the property would be the individual’s home, and in the other it would provide accommodation for a relative. There were no objections to either CPO.

Denbighshire County Council made a CPO in respect of a former Victorian asylum in extensive grounds in Denbigh. The proposal was that the site would be transferred to a building preservation trust. It would sell off parts of the grounds for enabling development, which would then fund the renovation of the main part of the listed building. Despite strenuous opposition from the owner, who claimed that he should be allowed to develop his own scheme, or sell to someone else who would, the CPO was confirmed. The Welsh ministers contrasted his track record, with substantial deterioration during his period of ownership, with the council’s well-thought-out proposals that, more likely than not, would be achieved.

Anglesey County Council made a CPO in respect of a former market hall, which it wanted to use for a library and community space. Some funding for the project had already been obtained and there was every indication that the balance of funding would be available following confirmation of the CPO. The owner had done some works to repair the property but they were limited in their extent. He had planning permission for a residential conversion scheme, but there seemed little realistic prospect that it would ever be implemented. The CPO was confirmed following a public inquiry.

This article originally appeared in IHBC's Context 148, March 2017. It was written by Chris Skinner, practice director for nplaw, the shared local authority legal service hosted by Norfolk County Council. He also heads nplaw’s CPO Consultancy Service, which undertakes CPO work for local authorities in England and Wales.