Forty years after the 1974 Kenny Report on the Price of Building Land there has yet to be a clear legislative statement on the scope of the power of compulsory purchase or on the measure of compensation for land compulsorily acquired.
Spread over 100 different pieces of legislation, the two most important of which were passed in 1845 and 1919, the law of compulsory purchase has been expanded on an ad hoc basis with little consistency between the different statutory schemes. Judicial interpretation of the statutory provisions has at times produced what, at first sight at least, appears to be unfair outcomes. Take the example of three individuals who have their homes devalued by harmful environmental effects caused by the construction and use of a motorway.
Farmer A has some of his land compulsorily acquired and the carriageway of the motorway is built on that land. He is entitled to full compensation arising from damaging impacts of the use of the motorway because the source of the environmental harm is on land taken from him.
Farmer B has no land taken. He is not entitled to any compensation though his dwelling is very near the motorway and severely impacted upon.
Farmer C has some land taken for the construction of the motorway embankment but still is not entitled to be compensated because the nuisance from the road does not emanate from the portion of his land which was compulsorily acquired (see Chadwick and Goff v Fingal County Council [2008]3 IR 166 ).
The position of Farmer B and Farmer C is apparently no better at common law under the law of nuisance because the defence of statutory authority is normally considered to be available.
However, in cases where the use of public infrastructure has a substantial impact upon property rights, it is difficult to see how the total exclusion of an entitlement to compensation can be justified solely on the basis that the environmental effects have arisen on lands that were not taken from the particular landowner.
For example, in some cases the development of a public waste disposal facility in very close proximity to a hotel, albeit under lawful authority, may have a catastrophic effect on the business of the hotel, perhaps leading to its closure. Under Article 40.3 of the Constitution, the State has an obligation to protect the property rights of individuals from unjust attack: hence the necessity to provide for compensation. While public policy considerations may come into play in defining the scope of entitlements, the fact that no land or a relatively small parcel of land may be compulsorily acquired from the hotel in the example given would appear to be inconsequential in terms of assessing the reality of the interference with property rights.
Some support for such an argument may be found in recent decisions of the European Court of Human Rights concerning the interpretation of Article 1 of the First Protocol to the Convention, notably Bistrovic v Croatia [2007] ECHR 423 . Doubt has also been raised by the authors of the leading Irish administrative law text, Hogan and Morgan on Administrative Law in Ireland (4th edition) as to the constitutionality of the defence of statutory authority under the law of nuisance, in this type of situation.
While the current controversy in relation to Eirgrid pylons has centred around whether the lines should go overground or underground and as to the "health effects" of the pylons, ultimately the impact on landowners will have to be assessed in monetary terms.
In the case of Electricity Supply Board v Gormley 1985 IR 129 , the Supreme Court held that section 53 of the Electricity (Supply) Act 1927 was unconstitutional because it did not provide for any statutory entitlement of the affected landowner to the payment of compensation. The amendment to section 53 under the Electricity Supply (Amendment) act 1985, while providing for such an entitlement, made no reference to the manner in which the compensation payable was to be determined.
In general terms, and having regard to the decision of Keane J. in Underwood v Dublin Corporation [1997]1 IR 69 , it can be said that the claimant is entitled to "full compensation." This may include compensation for (a) the value of the lands acquired based on their open market value; (b) severance or injurious affection (due to the reduction in value of the retained lands; and (c) disturbance (which may include a claim for loss of profits in the case of a business undertaking).
An interesting issue that arises in this area is the extent to which the perception of a health risk may affect the extent to which a landowner should be compensated for "injurious affection" to his or her retained lands arising from the location of ESB pylons close to his or her dwelling. A recent European Commission report noted that, although epidemiological studies have identified a greater incidence of childhood leukaemia in the vicinity of electricity pylons, no definite causal link has been established.
Ultimately, the decision as to whether the apprehension of health impacts from pylons result in a compensatable depreciation in the value of retained land will be a matter for evidence before the Property Arbitrator, who is responsible for the determination of disputed compensation claims, based upon the evidence of comparable sales of properties located close to pylons.
Eamon Galligan SC
and barrister Michael McGrath
are the authors of the recently published second edition of
Compulsory Purchase and Compensation in Ireland: Law and Practice
(Bloomsbury).