Compulsory Acquisition of Land in Victoria
Melbourne’s road system is constantly expanding. The city keeps growing and land keeps getting acquired by the government (usually Vicroads) to cope with the ever expanding need for more – and bigger – roads. The problem is that this affects “everyday” people in very real ways when the compulsory acquisition of land occurs in Victoria.
Landowners have their land taken from them – most are well aware of that – and there is no choice about it. The only “negotiation” is how much the landowner will receive by way of compensation. BUT –
… we hear little about the small business owners who are dealt the often devastating blow of being told that they must close their business and find new premises. Sometimes the business owner will own the building being acquired (which Vicroads will have to purchase at fair value) – but often the affected business owner is merely the tenant – perhaps someone who has signed up for a long lease (or bought a business with a long lease) with the view to building and working that business for many years to come. Then that opportunity is taken away one day when handed a Notice of Intention to Acquire.
After the Notice of Intention to Acquire is issued, there will be a period of time (often not long) to find new premises for the business prior to the acquisition taking place.
Without a doubt this blow can be devastating. People get affected all over Victoria – particularly at present the East-West link is affecting many or about to do so.
What can be done about being Served a Notice of Intention to Acquire?
The good news is that there is more compensation available than what you may think and, in most cases, more than what you may be initially offered.
My name is Glenn Duker. I am a Melbourne based property lawyer. I am going to explain here what you are entitled to – and, pardon the pun, hopefully show you that there is light at the end of the tunnel or, put another way, at the end of the road.
Tenants of Land Compulsorily Acquired
Let’s assume you are a business owner who is also the tenant. You pay your rent every month quite diligently and you business is doing well. It pays the bills and hopefully a bit more. In most cases you will be entitled to the following:
Firstly, you will be entitled to be compensated for “hard costs” of the relocation. This might include the removalist costs (and those who you engage to help you pack), the reasonable loss of any perishable items (especially in a food business), the cost of storing goods in a temporary location while you refit your premises. There will be many other costs which might be unique to your type of business which may be items that the acquiring authority should reimburse. It is important to keep all of your tax invoices and use professional organisations to assist (rather than your friend down the street), as this will ensure that your claim for a particular expense is justifiable.
Secondly, you will entitled to be compensated for trading profit loss resulting from the move. There will always be “downtime” in this type of transition. Provided you can show that you have acted reasonably, the full amount will often be claimable.
Thirdly, a little known fact is that as a tenant you can sometimes be compensated for loss suffered by you by having to pay a higher rental rate for the premises, compared to your previous premises. If you were on a low rent, particularly, this can work in your favour. If you have a long lease term or even options for further terms, this can have a multiplying affect and produce significant upfront compensation to you.
Expert evidence from valuers and accountants will often be required for this purpose but the good news is that the acquiring authority has a usual obligation at law to reimburse you for these professional fees as well. Many people do not know that compensation extends this far.
Compulsory Acquisition Compensation
Compensation also extends to legal fees being reimbursed in full. Many people simply do not know that compensation is available to cover all of these costs, which means you can be properly represented by lawyers who practice in this area and that your lawyers can engage expert valuers and accountants on your behalf to assist in pursuing your claim for the fullest amount of compensation.
All in all, there can be a silver lining to what will usually seem like a very dark cloud at the start.
Get legal advice as early in the process as possible in relation to your individual situation (as they are all different), so that you can properly understand your individual rights and to ensure that everything is done correctly during the move so as to maximise your available compensation. You need not be the victim. You may be able to achieve up to 10 times the original offer from Vicroads. Done right, many business owners come out happier and appropriately compensated. In many cases, it is possible to happier and in a better position than before.