Community Assets No 2 - Moratorium on a Disposal (Update No 2 - 23 November 2011)

The Localism Act 2011 requires an owner who has a property which is listed on the local authority's list of assets of community value to give notification of disposal. This will kick in an interim moritorium period of disposal, ie six weeks in which a community group may declare an interest in exercising their right to bid for the property. If one does so a full moratorium  period on the disposal arises, namel six months.

It follows that the stakeholders will all have to be alert to the impact of such a moratorium, namely:

• the owner should be aware that the property is on the list and be concerned that the appropriate "notification of disposal" (see section 96)  is made;
• any owner's estate agent should take into account the timing of the various periods given in the chapter, eg "full moratorium period", "interim moratorium period" and "protected period";
• prospective buyers (both community buyers or private buyers) will need to understand the nature and timings of any possible delays;
• any community interest group (see section 95(6)) wanting the property will need to comply with the procedures;
• the local authority (see section 106 (1), (2), (3), and (4))  will need to be geared up to give effect to the procedures.

Once the Regulations are published (probably in a few months) the full gamut of the legislation will begin to bear!


A point to bear in mind: where the vendor has a "going concern", eg as a branch in a bank and decides to close the bank branch, it may be difficult afterwards to maintain or claim the "community value" in the empty property. The issue is that the "community value" may lie in the continuation of the use, in this case banking: it is not in the property per se.

Community Assets No 1- Glossary - "Assets of Community Value" (Update No 1 -16 November 2011)

"Community asset" is a relatively new term which is being "enclosed" with a new statutory aura of terminology; so this post attempts a short list of the new jargon. I must admit that I have a layman's understanding of such matters so I am pleased at last to delve into the Localism Act 2011 which has just received Royal Assent (16 November 2011). Now we must await the pethora of Regulations!  

To the glossary - where the Bill is lacking in detail it might be expected that forthcoming regulations will fill gaps. Let the hunt begin!


Part 5, Chapter 3 of the Localism Act 2011 (sections 87 to 108) sets out the law of "assets of community value. " Under these provisions new terms we have to deal with include the following:

• community value - (see section 88(1)(a) - This is not a reference to monetary value such as "open market value" but to a quality of the land in its current use in furthering the "social wellbeing or social interests of the local community" [Note tht further detail is given in the section!];
• list of assets of of community value (see section 88) - The lists are to be drawn up by the local authority (see section 106(1) and (3)), eg district council, county council, etc.
• community nomination (see Section 89(2)(a) and (b)) This allows community councils, town councils and parish councils and their ilkies (certain voluntary bodies) to nominate land for the list. [They seem to be in a relatively weak position.];
• land of community value - "land" is widely and interestly defined (see section 108(1));
• owner - (see section 107) is defined in relation to land as to whether the estate held is freehold or a freehold with one or more leases. [In the latter the owner owns the leasehold furtherest from the freehold!]
• list of land nominated by unsuccessful community nominations (see section 93)
• moratorium on disposing of listed land - (see section 95(1)) - here  land on a list cannot be disposed of unless Conditions A, B, and C have been fulfilled (see Section 95 (2), (3) and (4));

My first look excited curiosity and revealed my general "cloud of unknowing" about such matters. A whole new field of interpretation is about to hit me - or so methinks! Later posts will explore these terms and more further.

Community Assets No 8 - Authority and Power to Compulsory Purchase (Update 1 - 18 November 2011)

For competent bodies there are about 150 (at least) separate statutory provisions available to purchase land with the power of compulsory acquisition, ie to buy land using a compulsory purchase order. The powers will cover the likes of:

• land and buildings for schools;
• land and buildings for housing;
• land and buildings for roads;
• etc.

The issue is "What is the nature of the powers which are available to buy a "community asset"?


It may be noted that power to buy property by agreement is usually available under the particular statute - the CPO provisions are there to back up the competent authority's position for the following reasons:

• against say, reluctant owners and/or occupiers;
• to speed up the process; or,
• to ensure approval by a higher authority, ie the appropriate Secretary of State.

A competent authority, eg a local council, is one able to seek powers of compulsory acquisition under a statute. The wording of the Act will or should make this clear. In England's rural areas this is likely to be the district council or the county council. In urban areas it will be the stated local authority. The issue is "What bodies are able to buy by compulsory purchase land and buildings for use as a "community asset"?


Firstly, it is not likely that a parish council or town council has or will have the statutory powers to buy land for community asset purposes by CPO: they may be able to do so by agreement...? Otherwise, it seems that a competant authority may seek to obtain a CPO for a "community asset" provided:

• the community asset is specifically covered by an existing power of compulsory purchase, ie included in the purpose of the enabling Act, say social care purposes;
• the community asset is such that it could be included in a particular scheme of acquisition, eg a regeneration project;
• finally, it may be bought under more general power, eg for planning purposes or economic development purposes.

An hypothetical example might be private land used as allotments. The section references are the Localism Act 2011 (November 2011)

The owner wishes to sell the land but the allotmenteers want the following:

• the land to be an the local authority's list of assets of community value (s 87(1));
• hence, to nominate (s 89) as a voluntary body (s 89(2)(ii)) the land as being of land of community value (s 88);
• once so listed, ensure the disposal of the land is subject to a moratorium (s 90); and,
• to persuade the parish council to persuade the district council to acquire the land by a CPO.

Of course, all of this requires;

• a good measure of time;
• an 'imbuination' of the details of the procedures under Part 5 Chapter 3 of the Localism Act 2011;
• support from the stakeholders;
• etc.

 A government circular, albeit dated, on CPO-ing is Circular 02/03 Compulsory Purchase Orders (see link) is nearly 100 pages of detail.
http://www.communities.gov.uk/documents/planningandbuilding/pdf/156360.pdf

Community Asset No 4 - Initiation of a Compulsory Purchase Order (Update No1 - 17 November 2011)

The references to sections are to those in the Localism Act 2011 (November 2011).

The actions required to obtain a compulsory purchase order need to be carefully planned and executed by the "stakeholders". The initiators are likely to be a small group of local residents who want to see a threatened local asset of community value (s 88(1)(a)).

• supportive local residents who might form themselves into a community group - to contribute ideas and raise funds for the project's immediate progression - they may want to make a community nomination (see s. 109(2) (a) and (b)) that the asset goes on the list;
• the relevant local authority - to be persuaded to make a CPO for what must be a justifiable community scheme;
• the local planning authority - to be consulted and may ultimately decide on the planning merits of the proposal;
• the owner (see s.107)and any occupiers of the property - (assumed for the purposes of this post to be opposed to the project); and,
• immediate neighbours who may be opposed to the project on amenity or other grounds.

Once formed the community group will need to make the case for project - particularly to the CPO-ing body. The main pointers on this score have been outlined by ministerial advice to the local authorities. No doubt further detail will emerge. For the purposes of this post the following is an attempted "interpretation":

• the nature of the worthwhileness or value of the project to the local community - the groups or groups of residents or visitors it will serve, the extent that life in the community becomes more sustainable....;
• the perceived threat to the asset - dereliction to the fabric of the building leading to its loss, retirement of the business owner, inappropriate development...;
• the future project in terms of its purpose, usage, management, and business (perhaps including its restoration, business development plan, funding)....;
• planning issues - the sustainability of the project for the future of the community, impact on neighbours and its amelioration....; and
• financing of the acquisition - local authority financing (if any), community groups financing etc...

Community Assets No 9 CPOs for Community Assets (Update No 1 - 18 November 2011)

The Localism Act 2011 (15 November 2011)) has possibly made it more likely that more than one community group is going to be asking their local authorities (LAs) to compulsorily acquire a private (or public?) asset which the community group regard as a being a land of  community value. [Note: This post assumes that the bits and pieces of the Act are operating - that is as time lordsladies we are in the future after the regulations are approved by Parliament.]

Initial steps before the CPO is likely to be considered are:

• if the LA has not put the asset on its list, a "person"  aka  the community group nominate the land (and buildings) as an addition to the LA's list of assets of community value.
• it then requires a notification of disposal of the owner; and
• a moratorium on the disposal.

In the past such groups have sometimes been able to purchase privately a local post office, shop, pub etc which is threatened with closure and hence cease to exist. At other times they have failed - perhaps for lack of time. It might be expected that a CPO will enable due process (and delays) - if successful, it will lead to the creation of a community-owned asset


The main purpose of this post is only to identify the main steps in the practice and procedures of obtaining a compulsory purchase order in the context of the Localism Act 2011 as they might be applied to creating an asset of community value. (Later posts will examine the steps in more detail.)


In outline the steps involve the following:

1. Initiation and relevant community body in operation;
2. Community body prepares and demonstrates the "case" to the LA and other stakeholders;
3. Relevant public body and authority to obtain powers to acquire land;
4. Making and submitting (if necessary) a compulsory purchase order;
5. Confirmation of the CPO and possible action in the High Court;
6. Notice to treat and possession against the owner (and occupier if different);
7. Assessing compensation for those entitled;
8. Completion and payment of compensation; and,
9. Commissioning as an asset of community value.

Community Assets No3 - Compulsory Purchase (Update No1 17 November 2011)

Communities facing the loss of treasured property-based assets, eg a privately owned pub, post office or a shop, may now feel empowered and emboldened to seek a compulsory purchase order (CPO). They would have to do this "via" the appropriate local authority, ie one with the relevant powers of acquisition.

Local authorities are issued with new guidance (in Appendix KA of Circular 06/04) on the expectation. Once a community group get to hear of the guidance they may feel justified in going for the CPO route - particularly where private treaty negotiations have failed.

All parties in the process will feel the weight or impact of the paper work generated - particularly the private owner who may want to retire quietly from his or her business with a nest egg. It is probable that CPOs still take a minimum of about say, 15 months so the retirement and the prospect of a quick sale for other use may be lost.

Prior to any CPO the owner may face a moratorium on an intended disposal of his or her property (because it is deemed to be an asset of community value). This new procedure under the Localism Act 2011 (November 2011) is intended to give a community interest group a chance to declare an interest in buying the property.

Community Assets No10 Circular 06/04 Compulsory Purchase and the Critchel Down Rules (Update No 1 19 November 2011)

If you have an old copy of Circular 06/04 beware! It has been revised this month with a new Appendix KA on page 57! Otherwise "passage of time" changes are recorded in the Planning Portal (16 June 2011). The new appendix concerns advice for yet more CPOs. (See Community Assests -No 9 - Update No 1.)

Demolition No 1 - Compensation and Demolition

An owner of a non-residential property wanting to demolish it may not get compensation if amendments are made by the government to the current compensation provisions concerning Article 4 Directions. More detail of the prospect of changed legislation is given on the Planning Portal (16/6/2011)