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With the recent announcement by the State Government regarding the additional acquisitions to be undertaken as part of the Torrens to Darlington project, a further 125 property owners (and various tenants) are going to be setting out on the journey that we have seen so many times before – trying to obtain fair and reasonable compensation for any and all loss suffered as a result of the acquisition.

This article is a brief refresher of the key things to look out for and be aware of if you are facing the prospect of having your property compulsorily acquired.

Understanding the process

From the moment that landowners are contacted by the government in relation to their land being acquired, there is a clear process that should be followed as set out under the Land Acquisition Act 1969.

The process can be a very difficult one to navigate without any assistance, particularly taking into account that it will generally be an emotional time for those having their land taken. The steps can also differ depending on whether the property is being partially or wholly acquired.

The government does provide some basic information regarding the process, however in our experience dispossessed landowners often find this information unhelpful and in some cases more confusing than informative. Part of the reason for this is because the information that is provided is of a general nature, whereas it is important to understand that every acquisition is unique and all landowners will be impacted in different ways.

Early in the process, the government will provide landowners with a sum of money up to $10,000.00 intended to assist in obtaining some initial professional advice from lawyers and/or valuation experts. Some landowners choose to keep this money and navigate the process themselves, however we would always recommend using it for its intended purpose. At the very least, an initial meeting and discussion regarding what to expect can provide peace of mind that you are equipped to negotiate a fair deal, and are aware of all of your rights and comfortable with the process.

The government is required to continue to cover professional costs beyond that initial payment, however costs beyond that amount will generally be settled at the end of the process.

Do I have to accept what I am offered?

It is important to remember that dispossessed landowners do not have to accept the first offer that they receive. The government will obtain its own valuation for the land being acquired and make an offer based on that, however is obligated under the legislation to “negotiate in good faith in relation to the compensation payable.” It is up to landowners to identify the ways that they are being impacted and the costs that they are incurring as a result, and to put together a claim for compensation accordingly.

Having said that, once a landowner receives an offer from the government they can take steps to immediately access the amount offered while continuing to negotiate for a higher amount.

What can I be compensated for?

A claim for appropriate compensation can be constructed in various ways and cover off on various things – we always advise clients early in the process to start thinking about the ways in which the acquisition will impact them and to attribute a dollar amount to those things where possible. This is where it can be particularly advantageous to have professional assistance. The heads of possible compensation include:

  • the market value of the acquired land as a starting point;
  • injurious affection – relates to a partial acquisition and takes into account where the activities to be undertaken on the acquired land will cause the value of the remaining land to diminish; and
  • disturbance – essentially any other economic losses suffered as a result of the acquisition.

Some examples of things that may be compensable include:

  • acoustic treatment to properties where road noise will increase above a safe level as a result of partial acquisition;
  • relocation/removal expenses and the cost of replacement furniture and fittings;
  • costs associated with purchasing a replacement property;
  • increased rent;
  • the costs of replacing certain things that are lost as a result of the acquisition (e.g. replanting of vegetation);
  • increased difficulty of accessing a property (e.g. have to drive significantly further, or loss of right hand turn into property etc.); and
  • any other cost that can be reasonably proven to be incurred as a result of the acquisition.

Getting a valuer involved on your side early in the process is highly recommended so that you can be comfortable that you understand the market value of your property – it is always worth having this independently assessed. Mellor Olsson has relationships with various valuers that specialise in this area.

Finally, it is worth mentioning the concept of ‘solatium’ payments, which come into play where the property being acquired is the principal place of residence of the dispossessed landowner. In such cases, landowners are entitled to an additional payment of up to $50,000.00 on top of whatever else is agreed, as an additional consolation.

How can we help?

Our team has extensive experience advising in this area and would be more than happy to arrange an initial discussion around your particular circumstances and the best approach for you in order to ensure that the fairest possible outcome is achieved. You can reach out to the authors directly, send your enquiries to [email protected], or call us on 8414 3400.