My land is blighted by a future acquisition

This page may be relevant if:

• Your land is designated or reserved for a future public purpose
• You have tried to sell and buyers withdraw once the project is disclosed
• Health or financial circumstances mean you need to sell now
• The acquiring authority says it is not ready to buy

What this usually means

• Where land is designated for acquisition for a future public purpose, the Land Acquisition (Just Terms Compensation) Act 1991 allows an eligible owner to require the authority to acquire it early, if the authority is of the opinion that the owner will suffer hardship if acquisition is delayed. Some owners, such as public companies and their subsidiaries, cannot use this pathway.
• Hardship has two parts. First, the owner is unable to sell the land, or unable to sell it at its market value, because of the designation. Second, it has become necessary for the owner to sell all or part of the land without delay, either for pressing personal, domestic or social reasons or to avoid the loss of, or a substantial reduction in, the owner's income. Where the owner is a company, those reasons must relate to an individual who holds at least 20 per cent of its shares.
• Land counts as designated for this purpose if an environmental planning instrument, such as a local environmental plan, reserves it exclusively for a public purpose (for example, public open space or a road) and names the authority that is to acquire it, or if an authority has given written notice, in connection with a development application for the land, that it will acquire the land in future. Owners of reserved land therefore use the same hardship provisions of the Land Acquisition (Just Terms Compensation) Act 1991. The planning legislation does not create a separate procedure: it requires the instrument to name the acquiring authority and provides that an instrument cannot otherwise require an authority to acquire land.
• Compensation is assessed under the Land Acquisition (Just Terms Compensation) Act 1991 and includes the market value of the land, assessed without the effect of the proposal. For a hardship acquisition, however, section 26 provides that special value, loss attributable to severance or disturbance, and disadvantage resulting from relocation need not be taken into account. The NSW Court of Appeal has held that this is a discretion, not an automatic exclusion, and NSW Government requirements direct acquiring authorities to consider each of those heads and to give written reasons if one is not paid. Legal costs of establishing hardship, incurred before the authority accepts the application, have been held not to be recoverable as disturbance.

What commonly matters

1. 01

   Establishing the designation

   The pathway depends on how the land is identified for future acquisition, so the instrument or designation needs to be pinned down first.

2. 02

   Evidencing hardship

   Marketing history, valuation evidence and personal circumstances together make the case; assembling them properly is most of the work.

3. 03

   Dealing with refusal

   All owners must sign the notice, although only one needs to be suffering hardship. Once the notice is given, the authority must acquire the land within 90 days unless a longer period is agreed in writing; before then it may instead lift the designation (for reserved land, by undertaking in writing to use its best endeavours to remove the reservation). If the authority decides not to acquire, the Act allows the owner 28 days after being notified of the decision to apply for an independent review, and if the land has not been acquired within 90 days the authority is treated as having refused for that purpose (NSW Government guidance treats the 28 days as running from then). The reviewer's decision is final, although a court challenge may remain available on limited legal grounds, so dates should be diarised from the outset.

4. 04

   Compensation discipline

   A hardship acquisition proceeds by compulsory process unless a purchase is agreed, but special value, severance, disturbance and relocation disadvantage can be left out of account, so each needs to be claimed and justified rather than assumed, and the cost of preparing the hardship application itself should be budgeted as unrecoverable.

How we help

• Advise on whether the owner-initiated pathway is available
• Prepare the hardship application and supporting evidence
• Deal with the authority and contest an unjustified refusal
• Run the compensation claim once acquisition proceeds