Select Committee on the Crossrail Bill Minutes of Evidence

Examination of Witnesses (Questions 11020 - 11039)

  11020. My learned friend's second point is this: "Oh well, you are going to destroy the whole statutory scheme for England and Wales". Not a bit of it. Let us look at the Law Commission's recommendations. This is the overarching point, and the complete answer to my learned friend's proposition is this: the Law Commission never said: "And this policy shall be applied to all Hybrid Bills". What would be the point of the Hybrid Bill procedure if we could not come before you and show on evidence, if you accept it, that we are in a completely different situation; that our business is much closer, if you want, to the facilities owner and the railway operator than the sandwich shop owner next to the road being dug up outside? That is the important point.

  11021. Can I then ask you just to look at the Law Commission recommendations, at page 137, paragraph 11.19, just to emphasise a couple of points.[30] Can I read this through with your Lordships and emphasise a number of points? "Three clear points emerged from our review: (1) Compensation for injury to land caused by the use of public works should continue to be governed by Part 1 of the 1973 Act." We are not into the use, we are into the construction, so we can happily bin that one.

  11022. "(2) Section 10, governing the compensation for injury caused by the execution of public works, needs to be recast in modern form." That is part of my complaint about—

  11023. CHAIRMAN: That is the archaic language point.

  11024. MR DINGEMANS: And the undertaking 234 being grafted on language which has been condemned. "(3) Since neither right is dependent on compulsory acquisition" (this is the `no taking' point) "it would be logical for the revised section 10 to be enacted by way of insertion into the 1973 Act." (That is neither here nor there.) "Our recommendation is designed to preserve the balance of the existing law which does not give rise to an obvious anomaly or unfairness. We are sympathetic to the view expressed by" (the recommendation committee) "that the scale of many public works makes it inappropriate to apply to them the same criteria as to private operations."

  11025. That is right, but the recommendation committee did also say extend the right for the 1965 Act claimants. "However, if that criterion is removed, the nature of the right changes. It is no longer simply compensation for loss of an existing right" (namely, the common law right) "but the creation of a more extensive right." That is what the 1973 Act has done, but within defined limits.

  11026. Can I ask your Lordships to note this: when the House of Commons made their recommendation they said "within defined limits". They said the Smithfield Market operators ought to have a recommendation and if you look at my note I have set it out at paragraph 12, where they invite the Promoters to draw up an alternative provision which would provide the tenants with the right claim for compensation in circumstances where a specific level of loss is experienced. I am sorry, my Lords, it is page 4, paragraph 12 of the note.

  11027. If one goes back to paragraphs 11.19 and 11.20, that picks up exactly the point about the 1973 Act, which is that the 1973 Act is designed in relation to use of public works "However, the detailed rules have been designed to produce a workable scheme with defined limits." What the Law Commission did not do was say: "By the way, we think the 1965 Act strikes the fair balance." What they did do, though, was say this: "The decision whether to make a similar extension to the rights of those affected by the construction period"—i.e. not use but the construction—"must be one of policy, taking account of the additional costs which it would entail for public authorities." We respectfully agree. We are not asking you today to change the national compensation code. We are not even asking you to begin along that road. What we are asking you to do is exercise your constitutional functions as members of a Hybrid Bill Committee, and to consider that.

  11028. "In order to restrict the multiplicity of claims, it might be appropriate to consider practical limitations ... a threshold related to the amount of the claim ..." simply so you do not deal with a £50 claim, which is not going to cause anyone any problems, or limits by reference to timescale of the works or the distance of the claimant's property from the site of the works. "It will also be necessary to establish rules for the assessment of the claims. Detailed work of this kind must await a policy decision on the issues or principle."

  11029. If one then looks at what the Law Commission recommended, they said, perfectly properly, that changing the national compensation code in that way is a matter for the legislature, as a whole. We respectfully agree. However, if you are talking about a detailed, Hybrid Bill where your Lordships are asked to listen to evidence and to make specific recommendations in the light of the evidence, is the Law Commission's recommendation support for the proposition that, effectively, we are the beginnings of the floodgates? Not at all, because we have to show to your Lordships why we are especially affected. You do not even need to worry about a recommendation about how far away we are because you know that we are going to lose the basement worksite; you know that we are going to have the works next-door.

  11030. On the evidence you know this: that Mr Berryman perfectly properly cannot say that he will not be back to the original scheme. You are going to approve the Bill in the format which permits them to take part of Lindsey Street. In those circumstances, what he is effectively saying is: "Don't worry about making special arrangements for them because it probably will not happen". If it probably will not happen, do not worry about the compensation provision; it is not going to cost anyone any money. However, at the moment, you are being asked to exercise your duties of approving this Bill, and no one argues that it is anything other than desirable, but with the powers to take the basement as a worksite for the escalator. All that my learned friend submits is that that is unlikely to happen. He still only offers an undertaking to use best endeavours not to, and you have explored in the evidence some of the problems that might lead to the situation recurring. How can it then be fair to say: "It probably will not happen but if it does it is entirely your risk, members of the market traders"—members who will not be able to go out and get insurance in the market (or the vast majority will not trouble and the one who says he did get it is going to bring home any claims)—when you have a nominated undertaker provided with public funds to discharge their public functions who are going to have a potentially catastrophic effect on the individual market tenants? How can that be fair, to put the balance on the market tenants. We respectfully submit it is not.

  11031. That is my learned friend's best point. He said, at the end: "There is nothing between us" and he used the illustration of the sandwich shop owner, but there is the world between the market tenants that you heard from this morning and the sandwich shop operator. First of all, they are in a uniquely sensitive business. There is no other business like that in London. I could have said: "Well, how many other people are selling meat on this scale in London?" The short answer is there is no one, because it has—and you have seen a bit of the history of the site—been developed into a leading market but uniquely sensitive in the middle of the City of London.

  11032. Then you have these compensation provisions. They have no real value in their land, they do not own much of their land simply because of the historic accident of it belonging to the city and no-one owning it. Take it, for example, to the parking bay rights. As a matter of law, I made my short submission before we adjourned for lunch about why, in fact, the parking bays were not going to help us and my learned friend said, "Oh, well lawyers disagree", I respectfully agree. My learned friend's entirely reasonable submission is you might be within the compensation provision. Our respectful submission is probably not because we have no legally enforceable right to the parking bay. That is exactly the sort of provision which is met by the indemnity, as my Lord right characterises it, in the circumstances.

  11033. CHAIRMAN: Would it not be met by Undertaking 234 as well?

  11034. MR DINGEMANS: No, that is exactly the point because Undertaking 234 would be drafted on the 1965 Act and I would not be able to show the nuisance. If, as Mr Abrahams thought he had, he had a legally enforceable right to the parking bay area, then we might have been in to a compulsory taking, what would have been a common law nuisance of his right to a parking area, therefore you are in the trigger event, but because he has no more right than your Lordship or me to that particular parking bay area and loading bay area, then our submission is that blocking it for construction traffic or having someone unload in it or taking it over is not going to give him the common law right to nuisance. That is the difficulty.

  11035. CHAIRMAN: Is there no halfway house between 234 as it stands at the moment and something which should be more acceptable to you, which is short of an indemnity?

  11036. MR DINGEMANS: My Lord, we have looked around, as your Lordships I suspect would have hoped we would, for precedence. The Midland Main Line one was far more extensive.

  11037. CHAIRMAN: No, you may have to invent it yourself.

  11038. MR MOULD: Yes. There are all those aspects of it and, indeed, the House of Commons set a limit before you get into it because one inferred from the discussions we had, because the reasoning was just one paragraph, there were concerns that effectively if someone lost one carcass they are not going to be troubling the nominated undertaker with that, quite apart from not wanting to do that in any event, but it is obviously right to protect it. We respectfully submit, if you are not, perfectly properly, not getting into rewriting the Bill or recommending that Bill be rewritten, if your Lordships think that there are still problems with the 1965 Act and that 234 suffers the problems that we have identified, recommending at least a form of scheme that reasonable lawyers, and although we take opposing positions, I certainly hope we both are considered reasonable lawyers, would be able to work out between themselves.

  11039. That is where we are. We do respectfully make the following submissions. The National Compensation Code was never designed to be the beginning and end of compensation, otherwise why have a Hybrid Bill procedure. Secondly, what everyone is striving for is a fair balance. The National Compensation Code sometimes will strike that fair balance, but it is common ground, it does not with us. Our submission is simply this, undertaking 234 simply does not give us the protection that my learned friend hopes or seems to hope that it should do. In those circumstances, when one is looking for the fair balance, that is, we submit, your constitutional duty to decide it, you are here having heard the evidence, you know more about the Crossrail Bill than anyone, I suspect, would ever want to know and have been exposed to it and can then make the appropriate judgment whether or not these are market tenants who simply are not going to get insurance for the losses that they will suffer when their dusty meat is condemned or will suffer when the Lindsey Street works does not operate and the market business falls down. Is it right that they should take the full cost of that or is that one of those unique situations where one can fairly say no. In fact, this is where the fair balance requires proper compensation being made to them and delivered in a way that my Lady, Baroness Fookes identified, that will be capable of short-circuiting all the claims management and issues that go with it. If we are dependent on Section 10 of the 1965 Act—

30   The Law Commission (LAW COM No 286) Towards a Compulsory Purchase Code: (1) Compensation Final Report, Conclusion, Para 11.19 (LONDLB-23-04-021) Back

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