Professional Documents
Culture Documents
REPORT
TO THE
INTRODUCTION I
MAJORITY REPORT
CHAPTER
I. Therisingprice of land suitable for building and some
examples of dealings in it 3
II. The causes of the increase in the price of land .. 10
III. Betterment 15
IV. Legislation and reports in Britain 18
V. The purchase by local authorities of land suitable for
building 23
VI. Suggested methods for dealing with the disproportionate
increase in the price of serviced and potential building
land .. .. .. .. *• •• •• •• 26
VII. Arguments for and against the designated area scheme 40
VIII. The Constitution 45
IX. Legislation in Italy and Northern Ireland .. .. 57
X. Recommendation and details of the scheme .. 61
XI. Other suggested changes in the law 70
ADDENDUM OF MR. D . F . RYAN
MINORMY REPORT
CHAPTER
I. Introduction
II. Reasons for disagreement ..
III. Possible alternative scheme • 99
IV. Details of alternative scheme
V. Arguments for and against alternative scheme 114
VI. Other legal changes
APPENDIX -Organisations and individuals who made sub-
missions to the Committee 124
COMMITTEE O N THE PRICE OF
BUILDING LAND
MEMBERS:
1
McAusltn: "Residential I and Priccs". Estates Gazette 15th April. 1972. p. 2*4
3
the United States of America, Canada, Australia and New Zealand.
The suggestion sometimes made that these increases arc a feature
peculiar to Ireland and that they are the result of some dcfcct in
our institutions or in our system of government and laws is
inaccurate.
12. Chapter I has shown that there has been a sharp increase m
land prices during the past decade. Since the amount of land avail-
able is, for all practical purposes, fixed, the influences on prices
must stem predominantly from the demand side. One demand
factor of importance is population. An increasing population will
require more land both to supply an increased amount of food and
raw materials and to cater for extra housing and other needs
Between 1956 and 1961 the average annual net emigration was
42,400. between 1961 and 1966 it was 16,121 while between 1966
and 1971 it was 10,781. In contrast to the population decline of the
1950*s there was a significant rise in population during the pest
decade (from 2,818.000 to 2,978,000). As this was thefirst sustained
increase for more than a century it marked an important turning
point and is a basic factor in our inquiry.
This increase in the size of the population was accompanied bv
other changes which are also of significance. The proportion of the
population living in cities and towns has continued to increase
rapidly. The 1971 Census shows that in 1961 the aggregate city and
town population was 1,299.000 and that in 1971 it had risen to
1,556,000. This latter figure was 52-2% of the total population and
is to be compared with 35-5% in 1936. Another influence has been
the increase in the household-forming age group of the population
and in the proportion of married persons in that group. The mar-
riage rate has risen since 1957 from 51 per 1.000 of the population
in that year to 7-3 per 1,000 in 1969. The decline in emigration hu
resulted in large increases in the numbers of those in the princip*'
marrying age groups (persons between 20 and 39).
21. The demand pressures outlined above have been further adde^
to in practice by the purchase by a number of largefirms in the
building industry of blocks of unserviced land near cities. In oi
near Dublin they have acquired about 4,000 acres which they wil
presumably hold until services are provided. These lands should meet
their requirements for many years to come. Whatever the longe'
term benefits to the firms concerned may be, this process of advance
acquisition intensifies demand and pricc rises in the short run.
22. A further factor which may serve to raise land prices occurs
incases in which the price of land compulsorily acquired by a local
authority is determined by official arbitration. Under the Act of 1919
the Official Aibitrator must determine the price as being that which
the land would make if sold on the open market by a willing seller
to a purchaser who is prepared to pay for its building potential.
There is inherent in this system the likelihood of over-valuation.
This tendency results from the fact that part of the compensation
to the owner consists of an award for the potential development
value of the land. This potential development value is necessarily
speculative because no one knows the precise form which future
develcyments will take, and so each owner claims that his land
should be valued on the most favourable basis. Since the probability
of development is not capable of precise arithmetical calculation,
arbitrators find themselves faced with a range of estimates and tend
to assess compensation on a basis which, in the interests of fairness,
favours owners. Hence the official arbitration system under which
the rules for the assessment of compensation in the Acts of 1919 and
1963 must be applied tends to inflate land prices.
24. The next question is whether building land prices will remain
stab'.c in the future or whether they will rise or fall. We believe
that many of the causes which produced the upward trend of the
past decade will continue. Our view is that if the present free
market system of determining price is allowed to continue, the
price of building land will continue to move in an upward direction.
The actual pace of such an upward trend can be greatly moderated
by appropriate action. For example, a reduction in the rate of
inflation would be a moderating influence on land prices. An in-
creased supply of serviced land would also make a contribution
towards achieving this result. This, however, would require an
increased expenditure on such services which could be only at the
expense of other forms of public expenditure. In this connection we
agree generally with the conclusions of the National Industrial
Economic Council in their Report on Physical Planning They
referred to the scarcity of serviced sites, particularly in Dublin, and
continued : " Until now, there has been no overall target for the
size of Dublin or for major developments within the Dublin area.
Growth has been largely spontaneous and allowed to proceed at
|ts own pace. This has meant there has been no clear target for
•nfrastructural requirements. And sincc the provision of the basic
ervices— especially water and sewerage--generally cannot be
13
expanded gradually (this can only be done in terms of relatively
large schemes), it has been inevitable that provision and require-
ments would get out of phase with each other. . . . In addition, in
our opinion, too large a proportion of the funds made available in
the past for building and construction within the public capital
programme was devoted to current housing in Dublin and other
cities, and not enough to the provision of the water and sewerage
which would make possible the provision of more houses, factory
buildings, etc. at a later stage. In this sense the composition of the
public capital provision may have been defective. It is not difficult
to understand why this could happen. The pressures for more houses
were strong and urgent and it is not, therefore, surprising that as
much resources as possible were devoted to building houses. In
circumstances of financial stringency such as during 1965-66—the
bulk of restrictions tended to fall less heavily on house building than
on the provision of water, sewerage and other services. This hap-
pened because it was in the short-term less unpalatable to cut or
delay such work than to cut house-building or spread house com-
pletions over a longer period. Moreover, the long-term costs of
reducing allocations for the basic services tend to be underestimated
or forgotten. . . . Whatever the reason, the result was that the mix
of output as between building houses now and providing the basic
services now which would lay the basis for houses and other build-
ings in future was not optimal. The consequences can now be seen
in the present deficiency in infrastructure, especially in Dublin
25. Since the publication of that report there has been increased
provision of schemes for sanitary services. In the Dublin area, for
example, six minor schemes had been completed by 1970. Other
major schemes are now being carried out and their completion
within the next few years should provide an adequate supply of
serviced land to meet demands in Dublin up to the mid 1980s
Schemes to increase the supply of serviced land are in progress in
other cities and towns where substantial growth in population r«
anticipated.
I The Scott Committee presented three reports: Cd. 8998 aod 9229 (1918) and
I* (1919).
29. A planning scheme affects the price of all land near chic;
and towns because improvements are carried out under it or because,
without any expenditure, it prevents the development of land which
would otherwise have been used and so increases the price of other
land or because it imposes conditions relating to density of buildinr
Therefore, one effect of the acceptance of the idea of imposed towg
planning was to widen the concept of betterment to include increases
in price caused by planning schemes. This widening of the concept
was reflected in Section 58 (3) of the Housing and Town Planning
Act, 1909 (which did not apply to Ireland) which provided for the
recovery of betterment in cases where any property was increased
in value by the making of a town planning scheme. Nothing
ever recovered under this section.
31. The experience with these sections in the 1934 Act fjvfsi
lesson about all previous legislation on this matter which it
be folly to ignore and which is corroborated by the melange!}
history of similar legislation in Britain. The ideas which inspired:
sections in the 1934 Act were admirable but as no planning schecc
under the Act ever came into operation, no collection in rttpe^1
betterment was ever made. When the Act of 1934 was repe-^
by the Planning Act, 1963, no similar provisions appeared in t
34. Many of the suggested " solutions " to the problem of increas-
ing land prices have been tried in Britain and the history of their
experience with many of the suggested changes in the law is of
considerable assistance. We wish to emphasise that many of the
changes suggested to us, while attractive in general principle, involve
such complicated legislative and administrative detail that they arc
unworkable. What follows is an outline of the British legislation
which is extremely complex. The Town & Country Planning Act.
1947, contains 120 sections and 11 schedules and was amended in
1951, 1953, 1954 and 1959. All the legislation on the matter was
then consolidated in the Town & County Planning Act, 1962, and
this was drastically amended in 1968. All the legislation was again
consolidated in 1971.
35. The first attempt to tax the increase in the value of land wa<
made in the celebrated Finance (1909-10) Act, 1910. This was a
duty of £1 for each £5 of increment value (it was therefore called
14
increment value duty ") and was payable (a) on any sale of any
interest in land or on the grant of any lease for a period of more
than 14 years, (b) on the death of any person when the land wi
liable to death duties and (c) in the case of land held by a corpora^
or unincorporated body so that death duties were not payable, in
1914 and in every subsequent fifth year. It was payable on a
increment value accruing after the 30th April, 1909. Incremec
value was defined as the amount by which the site value of the laiw
on the occasion on which increment value duty was to be collects
exceeded the original site value of the land ascertained in accordar.^
with the provisions of the Act of 1910. All the provisions of tte
Act which dealt with this topic were immensely complicated. J
valuation of all land in the country and four different values of eac1
parcel of land had to be made for the purpose of the assessment«
the duty. From the beginning it was clear that the entire schenv
was too complex for the public service as it was then organ -
and a number of legal decisions made it completely unworkab''
The increment value duty was repealed in 1920 but the oblige-
to get the stamp showing that particulars for its assessment h J
been delivered was retained in Ireland.
36. A number of schemes for the recovery by local authorities**
some part of the increase in the price of land caused by betterrr.^
were submitted to the Commission on the Distribution of Industr*
Population ( " T h e Barlow Commission ") which recommended 1 tnJ
38. One of the suggestions which they considered was giving local
authorities the right to acquire compulsorily land which had been
or would be improved by local authority works at a price deter-
mined by reference to its use value before the works were carried
out. Compensation assessed on this basis would not therefore include
anything for the development potential which the works carried
out by the local authority have created. In this way the increase in
price caused by local authority works would accrue to the local
authority which would get the benefit of it by selling the lands at
their full market price or by letting them at the economic rent.
This method is usually called recoupment because the local
authority are recouped for some part of the gross cost of the work
which they have carried out by the profit which they make on the
sale or letting. Recoupment as a principle had not been adopted at all
in Ireland and in Britain, when the Uthwatt Committee reported; it
had been restricted to cases where roads, streets and bridges had been
constructed or widened. In Ireland our laws about compulsory
acquisition were, until 1946, based on the assumption that the only
property which a local authority should be authorised to acquire
compulsorily was that needed immediately for the works which they
wished to do. By the Local Government Act, 1946 a power conferred
a local authority to acquire land for a particular purpose was to
k deemed to include a power to acquire land which the local
authority did not require immediately for that purpose but which
n their opinion they would require for that purpose in the future.
r
^e members of the Scott Committee were opposed to the adoption
°f the principle of recoupment because they thought it undesirable
that local authorities should be encouraged to engage in what they
called "land speculation They thought that betterment could be
^covered by direct charge and that acceptance of the principle of
f
ecoupment was unnecessary. This assumption that betterment could
** recovered by direct charge does not appear to have been borne
0ut
by subsequent experience: schemes for the recovery of better-
r
:nt by direct charge or levy appear to have failed.
39. 1 he Scott Committee reported in 1919. The change in view
between that date and 1942 is shown by the recommendation of the
Uthwalt Committee: 44 In our view purchase for recoupment is a
sound principle and the most effective of the existing methods b\
which a public authority may secure increases in value of property
which their activities have created
44. Between 1953 and 1959 there were two systems in Britain for
determining the price of undeveloped land. On a sale to a private
^son, the owner got the full market value while on a compulsory
acquisition, a public authority could pay only the existing use value
Plus the 1947 development value. The Town and Country Planning
Act, J959, abolished the dual system and provided for the payment
of the full market value in all cases.
48. One of the methods suggested for restraining the rise in the
price of land has been the purchase by local authorities of a pool
of land in anticipation of demand so that they could subsequently
release some of what they had bought when the price of land
became too high. When this happened, the local authority could
then help to reduce the price by putting some of the land which
they had bought on the market. This policy has been tried in the
Dublin area in recent years where the increase in the price of land
suitable for building had become very noticeable in 1966. One of
the consequences of this increase was that builders without large
capital resources could not purchase land. A number of voluntary
associations and co-operatives had been formed to provide houses
for their members and the increase in the price of land made it
impossible for them to do this. Much of the land in the County of
Dublin which would be suitable for building when services had been
provided had already been purchased by the bigger building com-
panies. If houses are not built by the private sector of the building
industry, the demand on the local authorities to provide accommoda-
tion becomes more insistent. The City and County Manager, Mr.
Macken, was concerned with the difficulties which the rising price
of land was creating for small building firms and for the housing
programmes of local authorities. The amount of capital available for
fusing is limited and if the price of land goes up, the number of
houses which can be provided by local authorities must be less. In
March, 1967, he wrote a report for the members of the City Council,
County Council and of the Corporation of Dun Laoghaire in which
redrew attention to the problems which the rise in the price of land
creating and to the necessity to take action to try to keep it
io
*n. His report included this passage :
51. Thus, 344 acres only out of the 1,902 purchased have been f
on the market and of these, 3,080 houses have been built «'•
in course of construction. Of the remaining 1.558 acres
have been zoned for housing, about 440 for industrial a n d ^ 7 «
commercial purposes, about 260 for open spaces and about ^
roads. The debt charges for the borrowing of the £3 million
year which ended on 31st March, 1971, were £284.964 ^
income from the sales and letting of the lands was less tna
interest and development costs.
$2. Wc think that the rate at which the Corporation have up to
now put the lands bought by them on the market has been too slow
to have had any significant effect on the price of serviced and poten-
tial building land. Land bought by the Corporation has been taken
off the market and this has contributed to the scarcity. We think that
the slow rate of disposal has been caused in part by the Corporation
havng bought land for which services could not be made available
rapidly. The completion of the Dodder Valley drainage and other
schemes should make it possible to speed up the rate at which sites
will be disposed of to builders. The Corporation have informed us
that they propose to release a further 500 acres of land for housing
development before March, 1974. Another contributing cause to
the slow rale of release was the decision to give preference to small
building firms when allocations of land were being made. Wc think
that this decision was an error and we strongly advocate that the
Corporation should allocate sites for houses in the lower price ranges
to allfirms that apply for them. This view has been put forward to
us by the Construction Industry Federation and we agree with it.
We do not however accept their main argument which was that local
authorities should not buy any land unless they require it for
municipal housing.
54. What we have already written shows that any legislation intro-
duced to deal with the matters in our terms of reference must have
two aims, the reduction or, at least, the stabilisation of the price of
serviced and potential building land and the acquisition by the com-
munity on fair terms of the betterment element which arises from
the execution of works by local authorities. These aims do not
necessarily coincide: legislation which provided for the acquisition
of the betterment element by any form of levy or taxation wiE
usually increase the price of all land.
...V U n d Cam
Paign—Lloyd George as a social reformer" by H. N , j r
I loyd George—Twelve Essays'' ed. by A. J. P Taylor (1971).
sion has been granted have in the majority of cases not been
developed because services are not available. Lands which cannot
be developed because services have not been provided could not
reasonably be taxed on the basis that they are suitable for building.
The main result of such a tax would be that owners and developers
would not apply for outline planning permission until the services
had been provided and then there would be a short interval only
between the grant of outline planning permission and final approval.
The area of land which would be liable to such a tax would be so
small that the tax would not alfect the amount of land put on the
market and the assessment of the letting value on which this tax
would be based would lead to prolonged litigation. We think it
probable that if such a tax were imposed, the yield from it would be
very small and that the cost of its assessment might well exceed the
ultimate proceeds.
70. The first and main argument for a designated area schen-
then is that it will give the community most of the betterni.
clement in the price of serviced and potential building land
is acquired by the local authority. The local authority have, in
40
view, a legitimate claim to this: the works carried out by them
have created it. All schemes which give part of it to the Central
Government or to a State Agency or to local authorities have failed
either because thc taxes were avoided or because the levies were
ultimately paid by the purchasers. A scheme under which a large
amount of taxation would be payable but which would cause a
corresponding increase in the prices of the buildings on the land
would, in our view, have failed to achieve its principal social aim.
71. The second argument is that the scheme will have the result
that it is unlikely that anyone will pay more than the existing use
value plus 25°1c of it for serviced and potential building land near
cities and towns. The local authority will be able to acquire the land
at this price and so no one will pay more than this for it. If our
proposals are accepted, there is a reasonable prospect that the
disproportionate increase in the price of serviced and potential
building land will cease and the scheme will, we think, end
speculation in this type of land. The owner of the land will know
the existing use value and if the local authority can acquire the
land at a price equivalent to 125% of this, there will be no room
for a speculative profit.
72. The third argument is that the scheme will enable the pricc
of land for selected uses to be reduced. We would expect local
authorities when leasing land to seek the highest price or rent for
commercial developments such as offices or factories but for social
purposes, such as housing or schools, we would expect land to be
made available on terms which covered costs only.
73. The fourth argument is that it will make it possible for local
authorities which have acquired land to impose conditions as to
thc type of building to be erected and its ultimate price to the
purchaser. When the local authority decide to dispose of land
within a designated area for building purposes, we think it desirable
that they should do so by making agreements with builders to grant
W s to them or their nominees when the buildings have been
completed and that these should impose stipulations as to the type
of building and its price. The local authority can then refuse to
jrant a lease if the conditions in the agreement have not been
observed. The scheme will strengthen the powers of local authorities
and will, we think, enable them to introduce some element of price
control of new houses. The leases of industrial and commercial
sues should be granted for premiums or fines and an annual rent or
at rents which may be reviewed at intervals of 7 years. A clause
permitting such a review has become a common commercial
practice and there is no reason why it should not be adopted
by local authorities. If however the Landlord and Tenant (Ground
Rents) Act, 1967 continued to apply to leases granted by local
authorities, the tenant could in some cases get a release from all the
covenants in the lease in relation to use by purchasing thc local
authority interest. This would defeat one of the main advantages of
the scheme. This is why we have recommended that the Landlord
and Tenant (Ground Rents) Act, 1967 should be amended so that it
will not apply to any leases granted by local authorities.
76. We are hopeful that the scheme we propose will end the dis-
proportionate rise in the price of undeveloped land suitable for
building. This is undesirable because it increases the prices of houses
and factories, makes development expensive and gives indefensible
profits which are earned not by risk-taking but which flow from the
services provided by the local authorities. The speculator in land
near cities and towns cannot lose and so the public regard such profit
as unearned and unjustified. These profits which have received wide
publicity make the achievement of restraint in money incomes,
particularly those of employees, difficult.
82. Thirty years ago the Uthwatt Committee reported that the
high cost of land and the fear of large awards of compensation
for refusals of planning permission were the main obstacles to
planned development of cities and towns. All experience in Ireland
and Britain since then shows that their views were correct. We
think that the principle that a landowner whose lands are being
acquired by a local authority should be paid the full market price
for them should be modified when it conflicts with the common
good which requires that the price of serviced and potential building
land near cities and towns should be limited by reference to its
existing use value.
90. The later decision of the Supreme Court in Foley v The Irish
Commission (1952) I.R 118 shows that the interpretation
which we have suggested of the decision in Buckley v The Attorney
General (1950) I.R. 67 is the correct one. Foley's case related to the
institutional validity of Section 2 of the Land Act. 1946. This pro-
ved that when a holding of land has been allotted to but not vested
* a purchaser and when the holding included a dwellinghouse, the
Land Commission might give a direction to thc purchaser to reside
continuously to their satisfaction in the dwcllinghouse and if he did
not do so, they could recover possession of the land from him. Mr.
Foley brought a lawsuit in which he claimed that this section was
unconstitutional because it was inconsistent with the article of the
Constitution relating to property. The action, in so far as it was
based upon constitutional grounds, failed. In the course of thc
judgment of the Supreme Court which was delivered by Mr. Justice
O'Byrne, it was pointed out that in Buckley's case there was no
suggestion that any conflict had arisen or was likely to arise between
the exercise by the plaintiffs in that action of their rights of property
in the trust moneys and the exigencies of the common good. The
judgment continued: "The argument put before this Court on
behalf of the appellant (Mr. Foley) when reduced to its logical
conclusion seems to involve the proposition that any limitations
placed by the Oireachtas on private property which may result in
the loss of that property by the owner is repugnant to the Con-
stitution and accordingly void. If this argument be sound, the
Constitution has certainly placed serious fetters upon the legis-
lature in dealing with property rights and the Court is not prepared
to accept such a far-reaching proposition
94. The next question under the Constitution which we have had
to consider is whether the power to designate an area within which
the local authority could acquire land at its existing use value plus
25% is an administration of justice: if it is and if it is not an
exercise of a limited function or power of a judicial nature, it must
be entrusted to a judge appointed under the Constitution. Section I
of Article 34 of the Constitution provides that justice is to he
administered in courts established by law by judges appointed in the
manner provided by the Constitution and except in special and
limited cases prescribed by law, is to be administered in public.
Article 37 provides that nothing in the Constitution is to operate
to invalidate the exercise of limited functions and powers of a
judicial nature in matters other than criminal matters by any person
or body of persons duly authorised by law to exercise such functions
and powers although such person or such body of persons is not a
judge or a court appointed or established as such under the Con-
stitution.
96. The Constitution, however, docs not define what thc adminis-
tration of justice is nor do the Constitutions of the United States of
America, Australia and other States which include provisions under
which the administration of justice is entrusted to courts. The ten-
dency when deciding whether a particular power is or is not an
administration of justice has been to take some features as being so
characteristic of it that their presence shows that justice is being
administered. These features are: (a) a dispute as to the existence
of legal rights or a violation of the law, (b) the determination of the
rights of the parties or the imposition of liabilities or the infliction
of a penalty (c) the final determination of legal rights or liabilities
or the imposition of penalties (d) the enforcement of those rights or
liabilities or the imposition of a penalty by the executive power of
the State which has been called in by the court to enforce its
judgment (e) the making of an order by the court which, as a
Natter of history, is an order characteristic of courts in this country
(see McDonald v Bord na gCon (1965) I.R. 217). There are some
questions which courts may have jurisdiction to decide but which
are not an administration of justice. The exercise of the jurisdiction
*hich courts have over wards is not, for example, an administration
°f justice. A decision may be an administration of justice though all
he features we have mentioned are not present.
99. In our view it is probable that the Courts would hold that the
decision as to whether the lands should be included in a designated
area was an administration of justice.
102. The next and most difficult constitutional problem which our
proposals present comes from Article 44 Section 2.6° which reads:
"The properly of any religious denomination or any educa-
tional institution shall not be diverted save for necessary works
of public utility and on payment of compensation."
106. During our discussions it has been suggested that the legis-
lation which we propose is repugnant to the Constitution because it
discriminates against the owners of land in a designated area. TV.c
argument is that owners of land outside a designated area will
entitled under the law to the full market price if their lands M
acquired while those whose lands are in a designated area will ^t
existing use value plus 25% only. The suggestion that this would
make the law repugnant to the Constitution is based on Article ^
Section 1 which reads:
44
All citi/ens shall, as human persons, be held equal befort
the law.
This shall not be held to mean that the State shall not in ^
enactments have due regard to differences of capacity, physical ar.J
54
moral, and of social function " and on Article 40 Section 3 which
*e have already quoted.
Article 40 Section 1 is a guarantee that citizens of the State will,
as human persons, be held equal before the law. It relates to their
essential attributes as persons, to those features which made them
human beings. It has nothing to do with their property rights.
Article 40 Section 1 has been considered by the Supreme Court in
two cases, The State (Nicolaou) v An liord Uchtdla (1966) I K. 567
and Quinnsworth v The Attorney General (not yet reported) in
which judgment was given on the 2nd April, 1971. In the first of
these cases the judgment of Mr. Justice Walsh contains this passage
(at p. 639): "In the opinion of the Court Section 1 of Article 40
is not to be read as a guarantee or undertaking that all citizens shall
be treated by the law as equal for all purposes but rather as an
acknowledgment of the human equality of all citizens and that such
equality will be recognised in thc laws of the State. The section
itself in its provision 4 This shall not be held to mean that the State
shall not in its enactments have due regard to differences of capacity,
physical and moral, and of social function ' is a recognition that
inequality may be or must result from some special abilities or from
some deficiency or from some special need and it is clear that the
Article docs not either envisage or guarantee equal measure in all
things to all citizens. To do so regardless of the factors mentioned
would be inequality
107. Article 40 Section 3 does not in our view require that the
same measure of compensation should be given for all property in
thc State which is acquired compulsorily. If the legislation is just,
thc State may prescribe different standards of compensation parti-
cularly when the increase in price is the result, in part, of works
carried out by the community.
108. During our discussions it has also been suggested that the
cgislation which we propose is repugnant to the Constitution
*cause it makes it possible for a local authority to discriminate
between owners of land in a designated area. Our scheme will mean
;
hat designated areas will probably include some built-up areas and
' is unlikely that the local authority will acquire houses or indus-
trial buildings. The owners of these will probably be able to sell
hem at their full market price. Moreover the local authority may
decide that they will not acquire all the undeveloped lands in a
designated area though we hope that they will. In a later part of
this Report we suggest that they should not acquire property used
r
sporting and recreational purposes when it is used for these pur-
Doses. The argument against our proposals is that the designated
*rea scheme will make it possible for local authorities to discrimin-
ate between owners of land in a designated area by acquiring some
the properties in it at existing use value plus 25% and by not
acquiring others. Neither Section 1 nor Section 3 of Article 40
Prohibits legislation giving local authorities a right to acquire some
Property at a price under its full market price provided that the
Mation is just. Under our scheme the local authority may acquire
55
any property in a designated area at existing use value plus 25c/
and so all property in such an area will be liable to be acquired on
these terms. The possibility that a power of acquisition may be mis-
used does not mean that such a power may not be created.
109. Our proposals are, in our view, not repugnant to any part
of the Constitution provided that the legislation confers the jurisdic-
tion to designate areas (including the determination of all questions
under Article 44 Section 2.6°) and to assess compensation on the
High Court and provided that the power to acquire property com-
puisorily does not apply to the property of any religious denomina-
tion or of any educational institution.
111. The designated area scheme may seem radical to those whose
thinking on property matters inclines them to favour the claim of
the individual against that of the community. The principle on
which it is based, that land which is suitable for building should
be acquired by the local authority at a price which ignores the
development potential and which is related to existing use value
has, however, been accepted by the Italian Parliament in a Law
passed on 22nd October, 1971 (No. 865). We wish to thank the
Italian Ambassador and his staff in Dublin for providing us with
the text of it.
Chapter II of the Law has the heading " Rules for expropriation
for public utility Article 9 stipulates that the provisions of the
Law are to apply to the acquisition of buildings required for the
purposes stated in Chapter I (subsidies for buildings), to the purchase
of land required for carrying out town planning, to the reclamation
of urban built-up areas, to the reconstruction of buildings or
districts destroyed or damaged by war or natural calamities and to
the purchase of areas included in the zones of expansion mentioned
in a Law of 1942. The local authorities which are given power to
<L7ange for the acquisition of land for public utility (and this in-
cludes town planning) have to deposit a report on the work to be
carried out and maps on which the areas to be acquired are shown
*ith the secretary of the municipality where the buildings are. A
list of the landowners and plans showing the current town planning
iTangemcnts has also to be lodged. The mayor then notifies the
arsons whose lands are to be acquired that their property is in-
cluded in the plans, and when he has considered their views, he
'^ds the documents to the President of the Regional Board who
then fixes a provisional amount of compensation for the acquisition
by applying the rules in Article 16 of the Law. The Law also pro-
vides that the parties may agree on the amount of compensation for
•Kkronity but that if agreement cannot be reached, the rules in
Article 16 arc to be applied. These provide that the Technical
Treasury Office is to decide each year before 31st January the
Wage agricultural value in the previous year of lands within the
ariotts agricultural regions defined according to the latest official
"ft cation of the Central Statistical Office. This average agricultural
Ac is to be calculated having regard to the type of cultivation
xtw'Jy practised. The article then provides two standards of com-
petition. one for areas outside built-up areas and the other for
bnds within built-up areas and within areas defined as historic
centres by the town planning bodies. The compensation for land
• ito&ide built-up areas and historic ccntrcs is the average agricuJ-
'ttal value appropriate to the type of cultivation carried on where
57
the lands to be expropriated are situate. The compensation for land
within built-up areas or historic centres is to be calculated in a ver\
complicated way but we do not think it necessary to describe this
When the amount of compensation is being determined, the suit,
ability of the lands for building and any increase in value attribut-
able to town planning decisions are to be ignored. If the lands
being acquired are capable of being cultivated by 4 4 a direct farmer
o w n e r t h e compensation to be awarded is double the existing use
value. If the lands to be acquired are being cultivated by a tenant,
the owner is paid the existing use value and the tenant is paid a
similar amount. The compensation will thus in many cases be
double the existing use value. Any landowner may appeal to the
court of appeal for the territory against the estimate of the Tech-
nical Treasury Office of the average agricultural value but the
basis of compensation remains the average agricultural value cal-
culated by reference to the type of cultivation carried on.
115. Wc are of opinion that the designated area scheme has many
advantages and that these completely outweigh the arguments
against it. We therefore recommend its adoption. We have already
given the main features of it. There are, however, certain details
which we now propose to describe.
120. Because cities and towns have grown in size and populate
and because the demand for houses has increased, it has bec^n*
necessary for local authorities to acquire lands outside their art*
0
and they have been given power t o acquire lands compute ;"? ;
such cases. It will, we think, be inevitable that local authorities^
concerned. The legislation to give effect to our proposals should
accordingly provide that when a local authority wishes to apply for
an order designating an area outside its functional area, it should
notify the local authority in whose area the lands are situate of its
intention to do so and that the two authorities concerned may then
make a joint application for an order designating an area. If the
local authority in whose area the lands are situate does not wish
to join in the application then the local authority seeking the order
in respect of lands outside its area should be allowed to apply for
such an order and should have power to acquire the lands subse-
quently at existing use value, plus 25% of it. When a joint applica-
tion is made and is granted in respect of any lands, the Court should
have power to determine which authority should be allowed to
acquire the lands if any dispute should arise between them about
this.
121. The effect of the designated area scheme will be that the
local authorities will become the owners of most but not necessarily
of all thc land within such areas. In some cases we envisage that so
long as the land continues to be used for its existing purposes, it
need not be acquired by the local authority. Thc types of land in
this category are property used for sporting and recreational pur-
poses (parks, playing fields, golf and race courses and property used
for community purposes) and existing dwellings, shops, offices and
factories. Our view is that if at any future date, an application for
planning permission to develop any of these properties is made, the
local authority could at that stage acquire them and pay compen-
sation on the scale applicable to other land in a designated area.
123. Our colleagues Mr. Murphy and Mr. O'Mean have objected
:
°our proposals because the power of the local authority to acquire
,j
nd in a designated area is discretionary and not mandatory in
sense that the local authority will not be under a legal obligation
J
acquire all the lands in a designated area. This, they say. will
h<v
e the consequence that there will be discrimination against those
,vv
ncrs whose lands are acquired. We have discussed the constitu-
e n t aspect of this in paragraph 108. The argument is that because
mission has been given where the work of development has started,
developers will continue to offer prices for land which will be con-
siderably greater than existing use value plus 25%. This would have
the result, it is said, that land prices would continue to rise and
that some owners would get more than others. This will occur
however only if the local authorities fail to use their powers to
acquire at existing use value plus 25%. If there is a general belief
that this power will be used, prospective purchasers will not pay
inflated prices. We recommend in paragraph 131 that where land has
been purchased before the dale of the publication of this Report,
the compensation on compulsory acquisition should be the purchase
price plus interest if this exceeds the existing use value plus 25%.
We emphasise, however, that this should apply only to purchases
made bona fide before the date of the publication of this Report.
It is essential to the success of the scheme that prices paid after
the date of the publication of this Report should be ignored when
compensation for compulsory acquisition of lands in a designated
area is being fixed. Our primary reason for not proposing that there
should be an obligation imposed on local authorities to acquire all
the lands in a designated area is that this proposal would interfere
with development in the immediate future. Some buildingfirms have
already acquired stocks of land to meet their future needs and there
could be considerable delays in development if the local authorities
had to acquire these before development could commence. However,
once the designated area scheme is in full operation, there is no
reason why local authorities should not acquire sufficient land to
satisfy all development demands and so local authorities should
in the future acquire all lands which are about to be developed. If
the designated area scheme is worked in this way, no discrimi-
natory treatment of different landowners will occur and so we fee!
that our colleagues' fears are not justified. If the scheme does not
work because local authorities fail to use their powers in an adequate
way to ensure its success, we have suggested that sufficient powers
be given to the Minister for Local Government to deal with such a
situation.
127. Other examples of judges sitting with persons who arc not
judges are given by the Electoral Act, 1963, in which an Appeal
Board consisting of a judge of the High Court, thc Chairman of
fiireann and the Chairman of Seanad £ireann hear appeals
the Registrar of Political Parties in connection with the
c
[ gistration of political parties in the Register and admiralty cases
' n which, when questions of navigation arise, a nautical assessor
^most invariably sits with the judge trying the case.
J - Lord Devlin. "Politics and the Law: a matter of judgment" Sunday Timei
,h
August, 1972.
128. In Britain and Northern Ireland the Restrictive Practices
Court was established by the Restrictive Trade Practices Act, 1955
to deal with the registration and judicial investigation of certain
restrictive trading agreements. The Court was to consist of five
judges and not more than ten other members. The judicial members
were to be three High Court Judges, one Judge of the Court of
Session in Scotland and one Judge of the High Court in Northern
Ireland, while the other members were to be persons who appeared
to the Lord Chancellor to be qualified to be members by reason of
knowledge of or experience in industry, commerce or public affairs
The Court was to consist of a presiding judge and at least two
other members for the hearing of any proceedings and the opinion
of tho Judge or Judges sitting as members of the Court on an>
question of law was to prevail. A decision of the Court on a question
of fact was to be final but an appeal on a question of law could
be brought to the Court of Appeal. The Restrictive Practices Court
has heard many lengthy and complicated cases and has dealt with
them with expedition. The judgments, which deal with what arc
primarily economic matters but which have a legal background, arc
of a remarkable quality and we are not aware of any substantial
criticism about the work of the Court.
133. The judge assigned to this work by the President of the High
Court should be given power with the concurrence of the Minister
for Justice to make rules of court regulating the practice and pro-
cedure in relation to the exercise of the new jurisdiction. This rule-
making power should include a provision that the judge may, if he
thinks fit, modify the rules of evidence so that affidavits would be
admissible in evidence though the person making them did not
attend to give oral testimony.
OTHER SUGGESTED C H A N G E S IN T H E LAW
136. When the title to land has been registered, the transfers of
it are retained in the Land Registry but members of the public have
not a right to inspect any of them. Section 126 of the Registration
of Title Act, 1964, gives the Registration of Title Rules Committee
power to make rules in relation to the inspection of and making
copies of or extracts from any register or document in the Lane
Registry. The relevant rule now in force (the Land R e g i s t r a t o r
Rules 1966) provides:
44
188 (1) The registered owner of property, the personal repre
sentative of such owner and any person authorised b)
the registered owner or his personal representative of
by an Order of the Court or by these rules but no oth«f
person, may inspect a document filed in the Registry or
a dealing with the property of the owner.
70
(4) The Registrar may, in special circumstances and on such
terms as he thinks fit, permit a person to inspect a
document filed in the Registry".
The result is that the Registrar cannot allow anyone except the
registered owner of property or his personal representative or
someone authorised by him to inspect documents by which land is
transferred unless special circumstances exist. We think that it
would be in the public interest that there should be a much more
extensive right to inspect all documents retained in the Land
Registry. We accordingly recommend that a rule should be made
by the Registration of Title Rules Committee that any person should
have the right to inspect, make copies of and take extracts from
any transfer of land retained in the Land Registry on payment of
an appropriate fee in respect of each document inspected.
138. Most of the speculation in land which takes place would not
te possible without the facilities which are made available by finan-
cial institutions. We invited the Irish Banks Standing Committee to
send us their view and on the 20th May, 1971, they wrote: "The
member Banks fully support any measures designed to control, for
l
he benefit of the community, the price of land for housing and
°fher forms of development. They wish to make it quite clear that it
s their agreed policy, in conformity with Central Bank guidelines on
-edit, to refuse generally to grant advances for speculative purposes
^d to state that this policy is actively pursued whenever, in the
particular case of land purchases, an element of speculation is
•nvolved or detected. Notwithstanding this effort to discourage
speculation it is necessary to appreciate that the main difficulty with
<*nd purchases is for a banker to distinguish between what is and
^at is not speculation. As a result, it is inevitable that instancescan
where accommodation granted for apparently genuine invest-
ment in land eventually turns out to be a speculative transaction.
1
inability to detect initially the nature of the transaction may be
ue
either to the terms in which the borrower makes his application
>r
to subsequent change of purpose on his part. Whatever the reason
71
a bank is practically powerless to prevent such speculation until the
true nature becomes apparent only after the deal is completed.
Although such cases are rare nevertheless the Banks welcome an>
proposals to reduce or prevent them and other forms of speculation
in building land. Any measures intended to curb them should, if
they are to be effective, embrace all the lending institutions in the
financial sector
It is a debatable question whether it is possible to advise any
scheme of credit control which will enable or require a bank or any
financial institution to distinguish between advances for the purchase
of property with the intention of developing it and those for
speculative purposes. We recommend that the Central Bank should
examine this question.
141. In some parts of the State there have been open, deliberate-
conscious breaches of the Planning Act, 1963 and of the conditio^
attached to permissions. When prosecutions are brought ir *
District Court, nominal penalties only are imposed. This leaJs w
contempt for the law and to a feeling of frustration by p l - n n •
officers. We think that the law should be amended so that a plann*
authority may apply to the High Court for an injunction to rcsir^
breaches of the Planning Act, 1963 and of the c o n d i t i o n s attach
to permissions, although they cannot establish the likelihood ^
irreparable damage. Under the existing law an injunction cat**
be granted to a planning authority to restrain unauthorised ^ V .
ment because they cannot establish that they have a
irreparable damage would follow if the injunction was not granted.
We think that every planning authority should be entitled to get an
injunction in the High Court to restrain breaches of the Planning
Act, 1963 or of the conditions attached to planning permissions
without proof of damage or loss to the planning authority.
146. Under the Act of 1919 the Official Arbitrator may state M
ihc Official Arbitrator, he should be obliged to state a case for the
decision of the High Court if any of the parties to the arbitration
request him to do so.
J O H N K E N N Y (Chairman)
MARTIN O DONOGHUE
L. REASON
•D. F. RYAN
B. A. O'BYRNE (Secretary)
7th March, 1973.
ADDENDUM OF MR. D. F. RYAN
Public Authorities
The Committee s terms of reference have posed some problems of
interpretation for me.
While I am a supporter of, and a signatory to, the designated
area scheme propounded in the majority report, I think that in the
context of our terms of reference the definition of a designated
area subsumes public authorities as local authorities.
Section 12 (2) of the Acquisition of Land (Assessment of Com-
pensation) Act, 1919 defines the expression land in very broad terms.
It also defines a 4 4 public authority " as any body of persons, not
trading for profit, authorised by or under any Act to carry on a
railway, canal, dock, water or other public undertaking.
This latter definition seems to me to apply equally to a govern-
ment department or a local authority but not to public or semi-
State bodies which theoretically are capable of making a profit.
D. F. RYAN.
7th March. 1973
M I N O R I T Y REPORT
CHAPTER I
INTRODUCTION
I
Committee provided evidence that the level of expenditure on the
provision of water and sewerage facilities in the 1%0's was not
sufficient to meet the increasing demand for serviced land for
housing, industry and other purposes. The result has been that the
pressures of demand (aggravated in some cases by speculative
dealings)
f
have greatly increased the prices that can be commanded
°r the restricted amount of serviced land available. A short-fall in
investment
f
in sanitary services is all the more serious in that many
° the schemes involved may take several years to plan and execute
a/
>d if investment is curtailed (as occurred in the 1960's) it may be
* considerable time before a really satisfactory rate of progress can
'Ittin be achieved. For example, the assembly of thc necessary
Professional and technical staff required to plan and design new
•kernes, and the building up of the civil engineerinc industry to
-nablc it to cope with them, are obvious constraints. We think that
krt is a clear case for the positive commitment of more capital
0
Meet the needs of the sanitary services programme for a con-
siderable period ahead (with particular reference to areas where
large-scale urban expansion is planned). If the capital needs of the
programme are not given a higher priority than has heretofore been
the case, it is inevitable that land prices will increase still further
and the achievement of regional and local planning objectives will
be made more difficult and costly. In some areas, the result may be
failure to reach targets for the creation of additional employment
and for the expansion of urban populations because of the absence
of the basic services needed to accommodate development on the
scale desired. Serviced land is the basic raw material of most
building development and it should not be allowed to go into short
supply.
Given the problems described, the fact that the Corporation dis-
posed of sites for over 3,000 houses in the first two years of opera-
tion of the scheme must be acknowledged. The effect of the scheme
on house prices is significant. The Committee were informed by the
Corporation in the same letter that on one estate of 700 houses then
under construction at Tallaght, on land made available by them,
three-bedroomed centrally-heated houses were being sold within a
range of £4,600-£4,800, net. We are satisfied that if the disposal
rate of land can be accelerated, as we have been assured it will be,
and if the Corporation can continue to make developed sites or
blocks of building land available at fixed prices to all builders in
need of land, the programme should have the effect of stabilising
or possibly reducing the prices obtainable for building land in the
open market and should materially assist in holding down house
prices. If builders can be assured of a supply of land from the
Corporation to meet the needs of their organisations, they ought to
* less disposed to pay high prices for land being put on the market
by private owners. Similar results could be achieved elsewhere.
1.6. There are obstacles in the way of more extensive land acqui-
ition by local authorities. One of the most serious is the heavy
financial burden which would have to be borne by the authorities
until the land is put to profitable use. We think that it will be
necessary for the Minister to consider special financial arrangements
fc
g- deferment of interest charges) under which the authorities
*ould be helped with this burden, at least on a short-term basis.
Action of this kind was recently taken in Britain.
1.7. Some of the submissions received by the Committee would
suggest that there is room for the development of greater co-
operation between the local authorities and the building industry in
a number of ways. It would be desirable for the Minister to con-
sider whether steps could be taken to ensure that the industry and
the local authorities are more fully informed of their respective pro-
grammes, problems and needs in relation to the supply of building
land. Such arrangements could be made on a regional basis through
the agency of the Regional Development Organisations. Closer con-
tacts between the industry and the local authorities might also help
to remove some of the planning control problems of which thc Con-
struction Industry Federation complained in their submission to the
Committee.
2.3. Our views have been influenced by the results of the detailed
study of the land prices problem undertaken in the Department of
Local Government on the instructions of successive Ministers from
1966 onwards. Copies of all the more important documents con-
nected with this study were made available to our colleagues on the
Committee, and we have no reason to believe that they found any
serious fault with the conclusions reached as a result of the study—
at least within the context of the legal advice given to the Minister
and the Government at the time.
2.6. We consider that the legal advice given to the Minister and
the Government before the Committee was established was correct.
The basic issue involved is clear—whether it is justifiable that lanJ
should be made available for development by taking it from
owners and paying them a price which is less than its market value.
In our view, this would not be justifiable. If the law is changed so
that local authorities (and, perhaps, other public bodies) can take
over land compulsorily for compensation based on existing use value,
it will represent a fundamental change in the State's attitude towards
private property rights. At present, the law recognises that the rigto
to own property includes the right to use it in the most profitable
possible way. It is true that the exercise of this right has for long
been subject to restrictions imposed in the interests of public health,
safety, morality, etc. and, in more recent times, to controls rclateJ
to orderly planning and development and the rational use of land.
The Planning Act of 1963, however, is based on acceptance of the
fact that the potential development value of land is an inherent r
of its value. Planning permission has to be obtained under the Act
for any substantial form of development; if, however, permis^'
refused compensation may be payable for the consequent reduct
in the value of any interest in thc land. Compensation is not payafr*
in a number of cases where it can be shown that the propov J
development is premature, or that it is not for particular reason5
in the interests of the common good, or where permission is avail-
able for other forms of profitable development.
If the existing use value principle for the acquisition of land
compulsorily for public purposes is applied, it means that the
development rights at present attaching to the land affected would
be extinguished without compensation and the compensation pro-
visions of the 1963 Act would cease to apply to such land. This
would be a very severe limitation on private property rights. For
example, its effect would be that the owner of an area of, say, 100
acres at present in agricultural use but provided with the services
needed to enable it to be used for building would, if the land is
acquired compulsorily by a local authority, receive compensation
based on its agricultural value. If we assume that the average pricc
of agricultural land in the area is £500 an acre, he would receive
£50,000. If the law had not been changed, he might have expected
to receive five to ten times as much. It may be argued that the
present situation encourages speculation and that this justifies a
drastic changc in the law. But if the law is changed, its application
will not be limited to 4 4 speculators since they cannot be legally
defined and isolated for special treatment. All the landowners
affected would be liable to the same restrictions. We do not believe
that such a severe attack on private property rights can be justified,
and we are unable to accept that legislation which would result in
the application of an arbitrary compensation principle (either gener-
ally or in relation to the property of particular persons) would be in
conformity with the Constitution.
2.8. The proposal that all building land should be brought into
public ownership at prices based on existing use would mean a form
of nationalisation of building land. This type of solution is discussed
briefly in the majority report and is rejected on administrative and
financial grounds. As this proposal has so frequently been put for-
ward as the 4 4 obvious M solution to the land prices problem, we con-
sider that a fuller statement of the objections to it is desirable.
2.15. Existing use value was operated in Britain as the basis for
the assessment of compensation for land acquired compulsorily by
local authorities, Ministers of State, and other public bodies,
between 1947 and 1959. British experience in the application of the
principle is of particular interest to this country because of thc
connection between our legal systems. The law in Britain, as here,
implies acceptance of the fact that the development value of land
is an inherent part of its value. Thus, the Town and Country
Planning Act, 1947, which was largely based on thc recommenda-
tions of the Uthwatt Committee, and which in effect nationalised
all development rights, provided for the payment of compensation
for those rights out of a central fund. Under the 1947 Act, develop-
ment of land (with certain exemptions) was made subject to plan-
ning control. The carrying out of such development involved
payment of a development charge representing the difference
between the value of the land in its 4 4 unrestricted " state and in its
"restricted " state, i.e. the difference between thc value of thc land
including its development potential (as established by the planning
permission) and its existing use value. Refusal of planning permis-
sion did not attract compensation since the owner no longer
possessed the development rights and he was to be compensated for
the loss of such rights where their existence was established. If
land was acquired compulsorily for public purposes, compensation
was to be based on existing use value.
3.1. If our view that open market value must continue to be the
basic determinant of the price of land acquired for public purposes
is accepted, it has to he considered whether any legislative action
to deal with the land prices problem is feasible at all. Our colleagues
are of the opinion that the choice is one between the scheme
proposed by them and leaving the existing position substantially
unchanged.
B. Right of Pre-Emption
4.13. Where a designated area order is in force in respect of any
land, it would not be lawful for the owner of such land (other than
M
excepted land to dispose of any interest in the land unless the
interest has first been offered to the planning authority for the area
D. Levy on Development
4.33. It is essential that there should be a levy payable on the
development of land in a designated area where a levy on disposal
has not already been paid within a certain period. Development
value is most often realised on the disposal of land, but it can aKo
be frequently realised on the actual development of the land. The
(British) Land Commission Act, 1967, provided elaborate rules for
the assessment of the market value of chargeable interests where
projects of material development were concerned in order to
ascertain the amounts assessable to levy. It is considered that ar
elaborate system of this kind would be unworkable here and it
felt that there may be three ways of dealing with the problem,
firstly, by making the levy payable to the Revenue Commissioners
in the same way as levy on disposals, secondly, by requiring the
planning authorities to collect the levy on foot of a condition
110
attached to the planning permission to which the relevant develop-
ment relates or, thirdly, by a levy related to the capital cost of the
development concerned. The alternative systems are discussed in thc
following paragraphs.
E. Alternatives
4.43. An alternative method to deal with the development prob-
lem would be to require planning authorities to charge a levy either
on the grant of planning permission or the commencement of
development under the powers contained in Section 26 of the Local
Government (Planning and Development) Act, 1963; these might
need to be amplified or amended to convert the " contribution " to
a real 14 development c h a r g e " which would take account of land
\alues. It seems theoretically preferable that the levy should be
assessable and collectible centrally and that it should not be left to
the vagaries of the planning machine, with all the attendant com-
plications about appeals, etc. As against this, it has to be recognised
that the other system outlined above involves many of the com-
plexities which were a feature of the British Land Commission
system and it might be more expedient to opt for a looser, less
prccise system operated under general planning powers. In this way,
the appeals system could iron out difficulties in a way that would
not be open to the Revenue Commissioners.
Miscellaneous
4 45. Compensation for planning restrictions payable under the
Local Government (Planning and Development) Act, 1963, in
ftspect of land in designated areas would have to be made subject
to a levy equivalent to the levy payable on the disposal of land in
those areas.
ARGUMENTS FOR AND AGAINST ALTERNATIVE
SCHEME
5.4. The third objection raised by our colleagues is that the levy
proposed would be passed on and that its ultimate effect would be
dearer houses and other buildings. Wc accept that this could occur,
but the problem is that if the open market value principle in the
determination of compensation for land acquired compulsorily has
to be retained, as we believe it must be, and if the private market
in building land is to be allowed to continue, some form of levy or
taxation would have to be imposed if any part of the profits realised
in land transactions is to be obtained for the benefit of the com-
munity. Moreover, we envisage that the additional powers proposed
by us would enable local authorities to intervene more effectively
in the land market and to build up reserves of land in key areas
more quickly; the release of such land as demand required at prices
based on acquisition costs, with appropriate additions to cover the
cost of any services provided and administrative costs, should have
a very significant influence on prices obtainable in the open market,
so that any effects the proposed levy might have on the cost of
development might not be significant.
6.2. In Chapter III, we have stated our opinion that the existing
compulsory purchase law is defective, and we consider that a full
review of it is necessary. We agree with our colleagues that it would
be desirable to consolidate into a single Act the law dealing with
the compulsory acquisition powers of local authorities and the pro-
cedures to be adopted by them and by the Minister in acquisition
proceedings. The law dealing with the appropriation and disposal of
land by local authorities might conveniently be incorporated into
the same measure.
6.4. The most important of the Lands Clauses Acts from the
point of view of acquisition by local authorities is the Lands Clauses
Consolidation Act, 1845, which contains the law about several
important matters affecting compulsory purchase (e.g. time limit for
the exercise of compulsory powers, treatment of interests of absent
or untraccd owners or of persons under a disability, mortgages, com-
pensation for severance and injurious affection, apportionment of
rent charges, entry on land, vesting of land by deed poll on failure
to make title, etc.). Many of the provisions of the 1845 Act have
become blurred and obscured with the passage of time and with
the enactment of legislation which modified or amended some of its
provisions, as for example the changes in procedure introduced for
acquisition for housing purposes by the Second Schedule of the
Housing of the Working Classes Act, 1890. When housing legislation
was being consolidated in the Housing Act. 1966. it was necessary
to keep the Second Schedule to the 1890 Act alive and to define
" Lands Clauses Acts " specially to include the provisions of that
Schedule. Every C.P.O. now incorporates the Lands Clauses Acts,
as defined in the 1966 Act, as well as the Acquisition of I>and
(Assessment of Compensation) Act, 1919, and amendments to the
1919 Act effected by later Acts. The present legal position is con-
fused and unsatisfactory and modern consolidating and amending
legislation is needed.
6.10. There is one final legal change which we put forward for
consideration. This is in relation to land for which planning permis-
sion has been given. Such a permission enures for the benefit of the
land and of all persons interested in the land—subsection (5) of
Section 28 of the Planning Act of 1963. A limitation on the validity
of planning permissions where the development has not been com-
menced and substantially completed within a certain time is recom-
mended in the majority report. We agree that some such limitation
is necessary and desirable, but wc feel that consideration might also
be given to the granting of new powers to planning authorities
enabling them to require that development for which permission has
been given should be completed within a specified period and, that
if this is not done, the planning authority should have power either
to cancel the permission (except in so far as it relates to any work
actually done) or alternatively to acquire the land by means of an
accelerated acquisition procedure for the purpose of ensuring that
the development is carried out, or completed, as the case may be
We consider that it is undesirable that people should be able to g*:
planning permissions for the purpose of establishing high land value-
and then hold on to the land indefinitely. This is particularly true
of housing land in, or in the vicinity of, built-up areas. The grant of
planning permission in such cases should carry with it some respon-
122
Nihility to ensure that the development is carried out within a reason-
able time and the existence of special acquisition powers which could
be invoked by the local authorities in appropriate cases could do
much to ensure that any tendency towards the hoarding of land for
which planning permission has been given would be checked.
MICHAEL J. MURPHY
J. T. O'MEARA
7th March, 1973.
APPENDIX
Local Authorities
Bray Urban District Council.
Carlow County Council.
Cork County Council.
Donegal County Council.
Dublin Corporation.
Dungarvan U.D.C.
Limerick County Council.
Longford County Council.
Mayo County Council.
Meath County Council.
Monaghan County Council.
Sligo County Council.
Tipperary N R . County Council.
Waterford Corporation.
Wexford County Council.
Wicklow County Council.
Government Departments
Department of Agriculture & Fisheries.
Department of Lands.
Department of Transport & Power.
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