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Highest and Best Use: Understanding Land Resumption in the Sunshine State
8th May 2023
In Queensland, constructing authorities are empowered to compulsorily acquire land for various purposes under the Acquisition of Land Act 1967 (Qld) (the Act). Purposes for which land may be taken include those relating to transportation, environment, educational and cultural facilities, urban planning, and health services, among other things. While land resumption is primarily carried out to provide infrastructure for the good of the community, landowners will sometimes be expected to carry the burden of having their land resumed.
As the land acquisition process does not require landowner consent, we have taken the opportunity to inform landowners of their role in the resumption process, and an entitlement to compensation.
The Resumption Process under the Acquisition of Land Act 1967 (Qld)
The process for the compulsory acquisition of land under the Act is as follows:
- The Act prescribes that a constructing body which proposes to take land shall serve a Notice of Intention to Resume (the NIR). The purpose of the NIR is to advise the landowner that the constructing body intends to acquire the land, as distinct from merely wanting it.
- Upon receiving the NIR, a landowner is entitled to submit an objection to the planned resumption. There is a minimum 30-day objection period. Once the objection period has expired and any objections have been received, the resumption process will proceed.
- If an objection is received in response to the NIR, it must be heard by either the constructing authority or by a delegate of the constructing authority. Once the grounds of objection to the resumption and the matters in support of such grounds have been considered, the constructing authority will decide whether to amend the NIR, discontinue or continue the resumption process.
- If the constructing authority decides to amend the NIR, the objector is unable to object to the taking of the land as provided for under the amended NIR if the landowner agrees to the amendment.
- If the constructing authority decides it does not wish to proceed with the acquisition of land, it will discontinue the resumption process by providing the landowner with a notice of discontinuance. The landowner will not be entitled to make any claim for compensation against the constructing authority for any loss or damage associated with the service of the NIR or the discontinuance. However, a landowner may seek compensation for costs and expenses incurred by the person who was served with the notice and any actual damage done to the land concerned by the constructing authority.
- If the constructing authority believes it still requires the land and decides to continue the resumption process, it may make an application to the relevant Minister for the land to be taken. The application must be made within 12 months of the NIR.
How is compensation awarded?
Compensation for land resumption is a key aspect of the land acquisition process and is designed under the principle of equivalence. Compensation should be equal in value to what has been lost. To achieve this, the compensation process has been designed to be fair and transparent, and to ensure that the rights of both acquiring authorities and landowners are protected.
In determining land value, the Land Court will consider the land’s “highest and best use.” Put simply, the Court will consider what the best use of land which may reasonably be expected to produce the greatest net return to the land. The test essentially recognises that the present use of the land may not accurately reflect the land’s true value. The amount of compensation payable will depend on a number of factors, including planning controls, subsequent sales of similar parcels of land, the value of the land and any other interests that may be affected by the acquisition.
When resumed land becomes vested in the constructing authority, the landowner’s ownership of the land is essentially converted into a right to claim compensation and they become a claimant. This right to compensation may be claimed from the relevant constructing authority. Generally, the compensation process is as follows:
- In Queensland, the onus is on the claimant to submit a claim for compensation in writing. The claim should include details of the land resumed and the total amount of compensation claimed. To that end, it is prudent for such claims to be supported by evidence from a registered valuer.
- Where an offer of compensation is made, the claimant will either accept or reject the offer. In the event an agreement is not reached, the matter may be referred to the Land Court for hearing and determination.
- In the event a party to a proceeding in the Land Court is dissatisfied with the outcome, they may appeal to the Land Appeal Court against all or part of the Land Court’s decision. Strict time limits apply to filing an application for leave to appeal and the right is not automatic.
How we can help
If you require assistance on matters relating to a resumption of land, contact our office to obtain detailed advice that may assist you through the resumption and compensation process.
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