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The process that precedes a compulsory acquisition can be long and drawn out. Some owners wonder whether the day will ever really come that they lose their land and get a right to compensation. Many wrongly assume there is nothing that can be done to claim for losses before the land is actually compulsorily acquired.

The last edition of this blog explored the scope of planning controls that allow the acquisition of land by government authorities. It is entirely possible that you may have to wait decades from the initial exhibition of a planning scheme amendment showing your land to be reserved for a public purpose to the actual acquisition taking place. In the interim, you are stuck with a blighted piece of land that may be unable to be developed to its full potential.

When can you claim the compensation?

Fortunately, there is a right to compensation contained in the Planning and Environment Act 1987 (Vic) (PEA) that recognises the potential loss suffered as a result of your land being reserved or shown to be reserved for a public purpose. Unlike in a compulsory acquisition, where the acquiring authority makes the first offer to the claimant, rights to compensation under the PEA are initiated by the claimant bringing a claim against the Planning Authority (usually a local council), or the Responsible Authority (usually a body such as VicRoads or Melbourne Water).

The right to claim compensation under the PEA is usually triggered by one of two events:

  1. An application for a planning permit being rejected by Council because it is reserved for a public purpose; or
  2. The land being sold for less than it would have been worth without the land reservation in place.

Those events occurring gives rise to a claim under the PEA for compensation for financial loss.

The principle underlying these PEA provisions is that the land owner should be able to be put in the same financial position as if their land had never been reserved for a public purpose.

Where do you start with a compensation claim?

Sometimes triggering a right to compensation can involve some homework – we can advise and help you through the process so that you can trigger rights immediately rather than waiting indefinitely for a compulsory acquisition to occur.

To discuss a case with us, you can contact us here.

Thank you for your feedback.

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