Roberts & Anor v South Gloucestershire District Council [2001] EWLands ACQ_90

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England and Wales Lands Tribunal

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[2001] EWLands ACQ_90_1993 (27 September 2001)

ACQ/90/1993

LANDS TRIBUNAL ACT 1949

COMPENSATION – Compulsory purchase of land for the construction of a road – value – assumed planning permission – value of minerals – planning permission for a commercial minerals operation not granted or to be assumed – compensation assessed on basis of agricultural value at £17,000 - Alternative valuation (Rule 50(4) Lands Tribunal Rules 1996) £86,000 – Land Compensation Act 1961 s.5 rules (2), (3) & (4), ss.6 and 14 -18.

IN THE MATTER of A NOTICE of REFERENCE

BETWEEN C F & M G ROBERTS Claimants

and

SOUTH GLOUCESTERSHIRE DISTRICT COUNCIL Acquiring

Authority

Re: Land to east of Abbots Road, Hanham, Bristol

Tribunal Member: P R Francis FRICS

Sitting at: Bristol County Court, Small Street, Bristol on 12 – 15 June 2001 and

48/49 Chancery Lane, London, WC2A 1JR on 26 and 27 June 2001

The following cases are referred to in this decision:

Pointe Gourde Quarrying and Transport Co Ltd v Sub-Intendent of Crown Lands [1947] AC 565

Myers v Milton Keynes Development Corporation [1974] 1 WLR 696

Wards Construction (Medway) Ltd v Barclays Bank Plc (1994) 2 EGLR 32

Bolton MBC v Tudor Properties Ltd (2000) RVR 292

West Bowers Farm Products v Essex County Council (1985) 50 P&CR 368

Laing Homes Ltd v Eastleigh Borough Council (1978) 250 EG

Batchelor v Kent County Council (1989) 59 P&CR 357

Inland Revenue Commissioners v Clay [1914] 3 KB 466

Copeland Borough Council v Secretary of State for the Environment (1976) 31 P&CR 403

Nicholas Nardecchia of counsel, instructed by Burningham and Brown, solicitors of Bridgwater, for the claimants

Gregory Stone QC, instructed by Legal Services, South Gloucestershire Council, for the acquiring authority

DECISION

This is a reference to determine the compensation payable to Cleo Frederick Roberts and Marion Gertrude Roberts ("the claimants") for the compulsory acquisition of land to the east of Abbots Road, Hanham, Bristol ("the subject land") by South Gloucestershire District Council (successors to the County of Avon) ("the acquiring authority") under the County Council of Avon (Avon Ring Road – Stage IV A) Compulsory Purchase Order 1989 ("the CPO") in connection with the construction of Stage IV A of the Avon Ring Road ("the scheme").

Mr. Nicholas Nardecchia of counsel appeared for the claimants and called Mr. John Eric Salmon FRICS MRTPI FIQ of Land and Mineral Management Ltd, Chartered Surveyors, who gave valuation evidence. Mr. Gregory Stone QC appeared for the acquiring authority and called Mr. John Leonard Ferguson MRICS, a principal valuer in the Mineral Valuer South office of the Valuation Office Agency, and Mrs Linda J Mawby BSc FRICS, acting Consultancy Manager (Valuation) in the Property Consultancy department of South Gloucestershire Council, who each gave valuation evidence. Mr. Peter Christopher Slane BSc Eng MICE FIHT gave highways evidence. I also heard evidence of fact from Mr. Graham Keith Roberts, Mr. Stephen William Perry, Mr. Noel Rees Phillips and Mr. Roger Martin Webb, all of whom had been employed by Avon County Council and were involved with the scheme.

FACTS

The parties had not prepared a statement of agreed facts and issues for this hearing, but one had been provided for the hearing of a preliminary issue held on 10 February 2000. From this, an agreed chronology of events and the written and oral evidence, together with my inspection of the subject land on 11 June 2001, I find the following facts:

3.1 The subject land comprised 1.6 hectares (3.95 acres) of agricultural land lying to the east of, and having a frontage to, Abbots Road, Hanham, Bristol, and formed part of a larger parcel (extending, in all, to about 15.4 hectares (38 acres)) belonging to the claimants.

3.2 On 29 January 1988 the acquiring authority granted itself planning permission under reg 4(5) of the Town and Country Planning (General Regulations) 1976 for the construction of stage IV A of the Avon Ring Road between Kingsfield Lane, Longwell Green and Durley Hill, Keynsham. This followed publication of the Draft County Structure Plan in 1982, a period of public consultation at which a number of alternative routes were considered, and submission of a planning application for the preferred route to the Secretary of State (as it did not accord with the then current structure plan illustration) who decided not to intervene.

3.3 The road was to be a high standard section of dual-carriageway which would be classified as part of the National Primary Road Network and would have a length of approximately 2.8 km (1.7 miles), the subject land forming a 204 metre section in the middle between chainage 1609 and 1813 and defined as plot no's 25, 25a, 25b, 25c and 25d.

3.4 On 18 May 1989 the acquiring authority made the County Council of Avon (Avon Ring Road – Stage IV A) Compulsory Purchase Order 1989, this being confirmed by the Secretary of State for Transport on 23 April 1991.

3.5 Notice to Treat was served upon the claimants on 9 August 1991 and they submitted a form of claim on 22 August 1991. Following Notice of Entry served by the acquiring authority on 19 September 1991, possession of the subject land was taken on 14 October 1991, this being the valuation date for the purpose of this determination.

3.6 A Notice of Reference was submitted to this Tribunal by the claimants on 4 May 1993. Proceedings were stayed by order of the Tribunal in July 1995 to enable the acquiring authority to apply for a Certificate of Appropriate Alternative Development under s17 of the Land Compensation Act 1961 ("the 1961 Act"). Following application, at which the claimants sought permission for residential development, recreational uses or mineral extraction, and the acquiring authority sought a nil development, a certificate was granted on 17 December 1996 which stated "…planning permission would have been granted for agricultural purposes and for the development for which the land is to be acquired, but not for any other development".

3.7 On 6 February 1997, the first claimant submitted an appeal to the Secretary of State under s18 of the 1961 Act and on 4 February 1998 the Secretary of State for the Environment, Transport and the Regions cancelled the s17 certificate and issued a new certificate which stated (in summary):

if the land were not proposed to be acquired by an authority possessing compulsory purchase powers, planning permission would have been granted immediately for:

(1) the laying out of sports pitches without floodlighting and the erection of a single storey building for use as an ancillary clubhouse subject to conditions [which included those relating to improvements to Abbots Road] on the subject land and in association with adjoining land [the claimants' retained land].

(2) any development for which the land is being acquired.

It was agreed that there were no conditions in the certificate relating to (2).

3.8 The construction of the ring road, where passing through the subject land, required the extraction of approximately 56,114 cu.m. (123,450 tonnes) of materials which included topsoil and a mixture of clay, weak weathered silt sandstone and thinly bedded laminated sandstone to a depth of about 4 metres, and Pennant sandstone to a total depth of 8.46 metres. This provided a cutting over which a new overbridge would be built on the line of, and at the existing level of, Abbots Road. To facilitate the construction of the bridge, and to allow Abbots Road to continue to be used, a temporary diversion (or land-bridge) was constructed on the subject land utilising an estimated 10 per cent of the materials extracted from the claimants' land. The balance of the excavated materials were removed and used partly for landscaping and the formation of a sound-bund elsewhere on the scheme, or tipped.

3.9 Borehole investigations into the geology of the land on the line of the scheme were undertaken by Exploration Associates in 1982/83 and 1985/86 and interpretative and factual reports were produced.

3.10 Contractors' access to the scheme was principally from roads to the north and south, apart from the final surfacing of the temporary diversion where use of Abbots Road was permitted for the road laying equipment and vehicles bringing surface materials ('black-top'). The use of Abbots Road for contractors was otherwise prohibited within the terms of the contract.

ISSUES

The claimants' case was that they should be compensated for the minerals as the extraction formed part of the development, and their expert valued them at £400,000 on the basis of what he calculated would be available for extraction to a minerals operator. In the alternative, if the minerals had to be valued upon the basis of the quantities actually extracted, rather than what was available, a figure of £200,000 was applied. No value was deemed to accrue in respect of the assumed planning permission for recreational purposes, as it was accepted that the costs of complying with the conditions attached to the amended s.17 certificate would outweigh any enhanced value.

The acquiring authority's case was that, whilst in principle, minerals may be relevant in valuation terms, in this case they were not, because not only did planning permission for the extraction of minerals not exist, but even if it did, the poor quality of material, the problems with access, lack of market demand and the costs of spoil disposal would make a minerals operation on this site uneconomic. Thus, in the no-scheme world, there would be no demand for that use from a prospective purchaser, and hence no value. In the acquiring authority's submission the land had a value for agricultural purposes and horse grazing only, and that amounted to £17,000.

The parties were agreed that, in principle, if minerals extracted from land as part of a scheme had a value, that value should be taken into account in calculating compensation under the 1961 Act. The issues that arise for determination in the instant case are:

1. Whether either the deemed planning consent granted following the s.18 appeal, or the actual planning permission (for the scheme) would permit the extraction of minerals as a discrete operation, without completion of the new road.

2. If it did, whether the estimated cost of completing the construction of this 204 metre section of road should be offset against any value for mineral extraction.

A preliminary issue on whether the value of minerals could be taken into account in the assessment of compensation was appointed to be heard by the President on 10 February 2000. At that hearing, which had been pleaded on the basis that the value of any minerals in addition to the value of the land should be taken into account, the acquiring authority accepted that if the points of claim were to be amended to include the value of the minerals as part of the value of the land, there was no legal issue to be resolved, and a ruling in that regard was not, therefore, required. However, the acquiring authority maintained that there were other relevant points to be considered in establishing the value or otherwise of the minerals element, and its defence would be amended to cover these matters – including the questions of planning permission, access and costs of construction.

The President ordered that leave be granted for the claimants to amend the Points of Claim at para's 1 and 7. Para 1 was subsequently amended to read:

"The claimants will aver that they are entitled to compensation for the value of their interest in the land acquired by the acquiring authority under [the CPO] taking into account the value of the minerals in the land which were extracted and removed by the acquiring authority"

Para 7 revised the value of the claim, but that figure was no longer being pleaded in the substantive hearing.

Leave was also granted for the acquiring authority to amend its Points of Defence.

Mr. Nardecchia said in opening to the substantive hearing that contrary to the oral concession that the acquiring authority had made at the preliminary hearing, it had subsequently raised new points of law in its amended defence, the expert report of Mr. Ferguson and the supplemental report of Mrs. Mawby. He said that by now raising arguments relating to the actual and assumed planning permissions the acquiring authority was not holding to its concession, but Mr. Stone said that was not the case. Whilst minerals were a relevant consideration in valuation terms, and whilst not conceding the planning arguments, he said that in assessing that value, account had to be taken of the quantity and quality of the minerals and the cost of the road. All relevant aspects had to be considered and, Mr. Stone said, the acquiring authority was not raising new issues that the claimant had not had the opportunity to consider.

CLAIMANTS' CASE

Mr. Nardecchia outlined the legal basis of valuation upon which the claimants' case was formulated. Compensation was to be assessed on the basis of open market value as set out in s.5 rule 2 of the 1961 Act at the date of entry which was 14 October 1991. The claimants relied upon para (2) only in the assumed planning permission set out in the s. 17 certificate granted on appeal, viz: "any development for which the land is being acquired" and it was accepted that no conditions applied thereto.

In addition, in accordance with s.14(2) of the 1961 Act, regard was to be had to any planning permission in force on the relevant land at the date of the service of the Notice to Treat. In this case, that was the 1988 permission for construction of Stage IV A of the Avon Ring Road.

Under s.6(1)(a) of the 1961 Act any effect on the value of the subject land attributable to the carrying out or the prospect of the development on land other than the relevant land is to be disregarded. This, Mr. Nardecchia said, was an important consideration as it meant that for valuation purposes the claimants land had to be looked at in isolation, and no regard was to be had to any effect on value that may be attributable to the rest of the 2.8 km sections of the scheme to the north and south. Stage IV A therefore, in this context, related only to the subject land (case 1 of Part 1 of the First Schedule to the 1961 Act being applicable).

The principle in Pointe Gourde Quarrying and Transport Co Ltd v Sub-Intendent of Crown Lands [1947] AC 565 was accepted and the claimants were not taking into account any enhanced value that there might be in the minerals to the acquiring authority for their use in the construction of the ring road. It was the claimants' case that the minerals had a value outwith the scheme due to the demand for Pennant Sandstone. However, Mr. Nardecchia said that this did not mean that that the existence of the actual and assumed planning permissions referred to in ss.14 and 15 of the 1961 act had to be disregarded. In the Court of Appeal decision in Myers v Milton Keynes Development Corporation [1974] 1 WLR 696 it was held that there was no conflict between Point Gourde and the assumptions under s.15(1) of the 1961 Act and therefore even if there was no planning permission in place at the date of the Notice to Treat, permission for the scheme was to be assumed. In any event, the claimants did not need to rely upon s.15(1) as there was a deemed permission under the s.17 certificate, so by virtue of s.15(5) permission could be assumed.

Accordingly the claim was to be valued on the basis that planning permission existed for the scheme on the claimants land, but any effect on value attributable to that scheme was to be disregarded. It was Mr. Nardecchia's view that the acquiring authority was attempting to deny this fundamental principle.

Wards Construction (Medway) Ltd v Barclays Bank Plc (1994) 2 EGLR 32 and Bolton MBC v Tudor Properties Ltd (2000) RVR 292 were helpful in illustrating that it was therefore necessary to value the land by imagining the state of affairs that would have existed in the no-scheme world but assuming that planning permission existed for the scheme development.

Having established the legal basis of valuation and the assumptions to be made under the 1961 Act, Mr. Nardecchia explained its application in regard to the claimants' case. Quoting West Bowers Farm Products v Essex County Council (1985) 50 P&CR 368 he said there could be no doubt that the extraction of a substantial amount of minerals (about 123,000 tonnes according to the acquiring authority's estimate) constituted development within the meaning of s.55(1) of the Town and Country Planning Act 1990 and this was unaffected by the fact that it was carried out as part of or preliminary to the construction of a length of road. The West Bowers case bore similarities to this one in that a farming partnership sought to construct a reservoir on its own land for the purposes of irrigation. In order to create the reservoir it was necessary to excavate a very substantial amount of sand and gravel (approximately 7.28 ha (18 acres) by 6.5 metres deep) which would be carted away from the land and sold. The appellants contended that the extraction of the sand and gravel was an engineering operation that was requisite for the use of the land for the purposes of agriculture and therefore permitted under article 3 of the Town and Country Planning General Development Order 1977. The local planning authority said that general permission should not apply in respect of the construction of the reservoir, and an application would need to be made for permission to construct it. The question therefore was, whether the construction of the reservoir would fall within the classes of development to which section 26(2) applied as constituting the use of the land for the winning and working of minerals.

In dismissing the appeal, it was held that whether a single process amounted for planning purposes to two activities was a question of fact and degree; that, if it involved two activities, each of substance, so that one was not merely ancillary to the other, both required permission; that the construction of the appellants' reservoir would involve two activities, each of substance, the extraction of minerals on such a scale not being merely ancillary to the carrying out of the engineering operation of constructing the reservoir; and that, accordingly, planning permission was required for the winning or working of minerals involved.

Nourse LJ said, at p374:

" Mr. Schiemann, for the appellants, submitted that the impossibility of constructing the reservoir without extracting the gravel demonstrated that the latter activity was an integral part of the former. There was one indivisible process. Therefore, permission for the former was permission for the latter. I accept the premise of that submission but reject the conclusion. The planning legislation is not impressed by the indivisibility of single processes. It cares only for their effects. A single process may for planning purposes amount to two activities. Whether it does so or not is a question of fact and degree. If it involves two activities, each of substance, so that one is not merely ancillary to the other, then both require permission.

Applying that test to the facts of this case, I am left in no doubt that the construction of the reservoir will involve two activities, each of substance. The extraction of so much gravel will not merely be ancillary to the carrying out of the engineering operations, as it would usually be, for example, where foundations were dug for a bridge or a building. I take due account of the fact that it is only the extraction that will take place on the land and of the other evidence to which Nolan J referred. Gravel will still be won and worked on a substantial scale. In my judgment, no other view of this case could reasonably be held.

I would dismiss this appeal".

Neill LJ said, at p376:

" I see no reason in principle why works that are carried out on land may not comprise development of more than one class. In many cases, building or engineering operations will involve as an incidental feature of the operations the extraction of gravel or other minerals. In such cases, it would often be quite inappropriate to treat the development as involving the winning or working of minerals within article 8(1)(b) of the Order of 1977. In the present case, however, though no treatment of the minerals on site is contemplated, the amount of material that is to be 'won or worked' is very substantial. An area of 18 acres is to be opened to a depth of nearly 20 feet, and beyond question this operation will yield many thousands of tons of minerals.

Looking at the matter objectively, development of this size involving the winning or working of minerals on this scale can and should be classified as development falling within the class set out in article 8(1)(b) of the Order of 1977 and not merely or solely as an engineering operation.

For these reasons, I, too, would dismiss this appeal".

Sir John Donaldson concurred. Mr. Nardecchia said that West Bowers proved there could be no doubt that the mineral extraction in the instant case amounted to development. It did not matter whether the works were classified as mining or engineering, the fact was that it was development. The s.17 certificate required it to be assumed that permission existed for any development for which the land was being acquired. It followed therefore that the land was to be valued at the valuation date on the basis that permission existed to extract the minerals and then build a length of road on the claimants' land. Both operations – the mineral extraction and the construction of the road – were part and parcel of the development, and within the permission granted to and by the acquiring authority in 1988.

However, in the no-scheme world there would be no Stage IV A of the ring road and consequently there would be no road built to the north and south of the claimants' land. The value of the land on this basis will depend upon the value of the minerals. If that value was sufficiently great, which it was the claimants' case that it was, then the land would have a market for that purpose, and the hypothetical purchaser under s.5 rule 2 would be likely to be a minerals operator.

The market value of the land would not be depressed by the cost of building the relevant length of road because the minerals operator would not be required by any actual or assumed planning permission to construct the road himself. There was no condition in the actual or assumed planning permission (or any other planning permission for that matter) that required the development to be completed, and there was no reason, therefore, why the development could not be implemented in part. The hypothetical purchaser would know, when formulating his bid for the land, that with no likelihood of the road being constructed to the north and south of the claimants' land in the no-scheme world, there would be no demand for the land from a road builder once the minerals had been extracted. He would simply assume that once he had completed the extraction, the resulting void (or cutting) would have no value other than for restoration (by filling with inert waste) and after-use as horse paddocks. He would be likely to take the prospects of obtaining planning permission for infilling and appropriate after uses into account when assessing the value of the land.

This was the fundamental difference between the claimant and the acquiring authority, Mr. Nardecchia said. As there would be no requirement for a road to be built in the no-scheme world, the estimated cost of construction of the 204 metre section on the claimants' land was irrelevant. The claimants had valued the land in accordance with s.5 rule 2 of the 1961 Act according to all its potentialities. The benefit and burden argument that was being promulgated by the acquiring authority did not bear scrutiny. The only real value in the land was for minerals extraction and with the purchaser not being required to construct the road, no account of the cost of construction needed to be taken. Any additional value attributable to the prospect of obtaining planning permission for infill and for the after use as horse paddocks would not make a material difference to his value calculations.

In summary, Mr. Nardecchia said that the combined effect of ss.6 and 14 – 17 of the 1961 Act required the claimants to assume a permission for partial implementation of the scheme – a new road on their land alone. The extraction of minerals was permitted by the actual and assumed permissions. Although the s.17 certificate issued on appeal did not specifically allow minerals extraction, the application for that use having been refused by the Secretary of State, the words of the certificate showed that permission was assumed to be granted 'for any development for which the land is being acquired'. The development included minerals extraction and, as had been shown in West Bowers, the extraction was of sufficient scale to constitute development for which planning permission was required. The extraction was, therefore, indisputably permitted notwithstanding the refusal to grant a certificate for minerals extraction in the wider sense.

Mr. Nardecchia said that the provisions regarding special suitability or adaptability of the land as set out in s.5 rule 3 of the 1961 Act as enacted at the valuation date did not apply in this case. There would be a market for the land for minerals extraction. He also said that the fact that planning permission did not exist for restoration by landfill or after-uses such as horse paddocks did not matter as there was nothing to prevent regard being had to the possibility of obtaining such permissions (s.14(3) 1961 Act).

CLAIMANTS' EVIDENCE

Mr. Salmon is a Fellow of the Royal Institution of Chartered Surveyors (Minerals and Environmental Management and Rural Practice Divisions), a member of the Royal Town Planning Institute and a Fellow of the Institute of Quarrying. He is a director of Land and Minerals Management Ltd of Frome, Somerset, a specialist consultancy involved in advising quarry and landfill operators and landowners in respect of land management, planning and valuation matters. He has over 20 years experience in the mineral industry and produced his expert report and valuation together with a supplemental report that addressed a number of issues raised by the acquiring authority's experts.

His valuation was stated to be based upon the fact that at the valuation date the land had planning permission for 'any development for which the land is being acquired', and the value of the land therefore extended to the value of the minerals which would be extracted in connection with the construction of the road. That extraction necessitated the excavation of a deep cutting which he had estimated at some 8 metres below the original surface, to which he added a further 2 metres to allow for foundations and drainage. He had valued the land in accordance with the Pointe Gourde principle, ignoring the effects of the scheme. The hypothetical purchaser, who would be likely to be a quarry operator and supplier of natural stone, would therefore be entitled to take the view that although he may not wish to construct the road, he could prepare the site for its construction. That would involve the removal of substantial quantities of valuable sandstone. Knowing that, in the no-scheme world, there would be no point in constructing a 204 metre section of road that would not connect with any road to the north or south, the minerals operator would be aware that there would be no market for the land from a road construction company.

The minerals operator would, rather than leaving a worked-out void, be likely to seek planning permission to return the land to its original contours by landfill with inert waste, then restoration for use as horse paddocks or sports pitches. Mr. Salmon said that in his view, planning permission for landfill would be granted, as the local authority would wish to see the land restored rather than left as an unsightly void. He had therefore prepared his valuation taking into account:

i. the capital value of the mineral deposits

ii. the potential for the disposal of waste; and

iii the value of the land after restoration of the surface

Mr. Salmon described the geological strata of the land in the Hanham Abbots area as 'carboniferous Pennant sandstone interposed with mudstones and thin coal seams forming a gently sloping plateau which rises above the gorge cut into it by the River Avon'. There was, in his opinion, a demand for such stone in the local area due to the fact that many of Bristol's older properties were constructed of that material, and it would be needed for repair. There was also a demand for Pennant sandstone for new buildings being constructed in traditional style, and for boundaries and ornamental wall facings. With only one other Pennant sandstone quarry in the area (Conygar Quarry at Clevedon), and that not being operational at the relevant date, and having substantial inherent problems, there was certainly considered to be a market for that stone.

Accepting Mr. Ferguson's conclusion that the quality of the stone on the subject land was variable, as evidenced by the photographs taken after the cutting was created, Mr. Salmon said that the quality of materials removed was in line with the borehole reports of Exploration Associates (Warwick) Ltd taken in 1987 and which would have been available to a prospective purchaser at the relevant date. Although a prospective purchaser would not, of course, have the benefit of the exposed strata when formulating his bid, it was normal practise to excavate trial holes or trenches to evaluate the stone quality. In any event, he would have been aware of the general quality of stone in the area from the number of old quarries depicted on local maps, and from the quality of the stone that had been used in building many properties in the vicinity.

Mr. Salmon said that he had estimated the volume of useable stone (suitable for dressing and sale as building stone) at 50 per cent of that available for extraction and that figure took account of a proportion of weathered top rock, margins to site boundaries and side slopes, interburden and extraction losses. Based upon the area of land, the assumed depth of 10 metres and allowing for a 10 metre 'stand-off' adjacent to Abbots Road to protect it, his calculation suggested 63,420 cu.m. of available stone suitable for dressing and sale as building stone (139,524 tonnes). This assumed the first metre depth in the excavation to be topsoil and subsoil, with a further 3 metres of weathered rock totalling 77,000 tonnes that could be disposed of as hardcore, leaving 6 metres depth of Pennant sandstone.

Of the 50 per cent available for dressing, Mr. Salmon assumed 40 per cent of that to be suitable for further dressing and sale as building stone (which would result in a further 20 per cent wastage), and 60 per cent to be suitable for sale without further treatment as garden/rockery walling. These calculations produced, from the 139,524 tonnes of stone available, only 22,320 tonnes of dressed building stone - 16 per cent of the total. This he felt to be more than sufficient to allow for any concerns about overall stone quality.

Following research into stone prices in 1991 Mr. Salmon assessed the value of dressed stone for building at £100 per tonne, the uncropped stone for walling/rockeries at £37.50 per tonne and hardcore at £2.50 per tonne.

Based upon his assessment of market demand, and output from other quarries Mr. Salmon anticipated an average annual output, over a period of 10 years at 4,190 tonnes of walling/rockery stone, 2,230 tonnes of rough dressed stone (for building) and 14,510 tonnes of waste/hardcore. This gave a total annual income to the quarry operator averaging £416,000. The annual cost of working, preparing and selling the stone was calculated at £278,570 giving a gross margin of £137,830 pa. As the land was freehold, there would be no royalties to consider, however a notional royalty could be applied to reflect the rent which an operator would expect to pay. Although he had not let any quarries on this basis Mr. Salmon thought 50 per cent of the gross margin would not be unreasonable. This would amount to £68,915 pa. This, he said, was supported by the other accepted method of calculating rent – at 15 - 18 per cent of turnover in the quarrying business, which gave a similar figure (£62,640 at 15 per cent). Bank Top Quarry, which was one of his comparables, had a site rent of 12 per cent of turnover – subject to a minimum.

Moving to the value that might be attributable to the prospects of obtaining permission for landfill (which Mr. Salmon thought were very good), he estimated the available void space at 100,000 cu.m. to include an allowance for 'doming' to allow for long term settlement and to facilitate effective drainage. The landfill, which would be with inert, environmentally friendly waste, could commence long before the quarrying was completed. He allowed for 20,000 cu.m. for five years, fill being completed 1 year after the completion of extraction, i.e., year 11. At £2.25 per cu.m. this would give the operator an income of £45,000 pa. Allowing 50p per cu.m. for management and handling costs, this gave a gross margin of £35,000 to which a royalty of 50 per cent was applied, giving £17,500.

Finally, the value of a prospective after-use as horse paddocks after allowing for costs of fencing, provision of water and electricity and a deferment of 11 years amounted to £12,280. Taking all the factors into account Mr. Salmon's valuation of the land, on the basis of the available stone amounted to £400,000 and is set out at Appendix 1 to this decision. In the alternative, Mr. Salmon produced revised calculations on the basis of the materials that the acquiring authority stated were actually extracted, and this gave a figure of £200,000 (Appendix 2). However, it was the claimants case that a minerals operator would base his assessment of value upon what could be available, and thus it was the former figure which was considered appropriate.

In response to the acquiring authority's expert's contention that the land had a tendency to flood, as depicted on a series of photographs taken whilst the road was being built, Mr. Salmon said that there was no evidence of serious flooding in the long term – this proven by the fact that no pumping operations were carried out. The nature of Pennant sandstone was such that water would tend to seep into the fissures between the rock and the borehole information that had been obtained did not bear out the contention. He accepted that flooding would be a deterrent to a minerals operator, but saw no problem in installing a pump and discharging surplus water in times of exceptionally inclement weather onto the claimants' retained land – for which a licence would not be required (s.24 Water Resources Act 1963).

The question of access to the land for a minerals operator in the no-scheme world was not considered by Mr. Salmon to be a problem of sufficient stature to have any material effect on his bid. Whilst accepting that the existing field access to the west of the land onto Abbots Road was substandard, it was wide enough for a commercial vehicle to get through. As planning permission existed by virtue of the s.17 certificate for operations on the claimants' land up to and immediately abutting Abbots Road, no further permission for access was required, and as the acquiring authority used temporary accesses during the construction works (as evidenced by photographic records) there was no reason why the hypothetical purchaser could not do likewise. It should be remembered, Mr. Salmon said, that most quarries were in rural areas with accesses onto narrow roads, and the accesses to the subject land were no worse than most.

Even if those temporary accesses were deemed not permissible for use by the minerals operator, there was nothing to stop him using the existing field gate to the west, and if he applied for permission to improve it, it would be illogical for the local planning authority to refuse because to do so may be seen as exacerbating an existing danger. Furthermore, the acquiring authority had constructed a new accommodation access to the east of the land, and it was reasonable to assume therefore that if the assumed or actual permissions permitted that access for the authority, then that same permission would have enured for the benefit of the minerals operator.

Mr. Salmon said that the market for quarries was insular and small. Comparison of prices achieved was difficult due to the fact that, often, sale prices were rarely publicised and many transactions were not at arms length. There tended to be a huge variation in values and some of the deals were complex, with capital values depending upon output over a number of years following the purchase. In preparing his valuation he had considered Bank Top Quarry near Bingley, West Yorkshire which was available to rent and where the passing rent represented 12 per cent of turnover. There were permitted reserves of 10,000 to 20,000 tonnes with the prospect of more being available subject to planning permission. Cotswold Hill Quarry, near Stow-on-the-Wold was a 4.6 acre limestone quarry where offers were invited for the head-leasehold interest. Royalties payable under the terms of the lease were on a reducing scale from 7 per cent to 5 per cent of turnover and represented about £8 per tonne. Both of these demonstrated, Mr. Salmon said, that royalties and rents were far from nominal, as had been suggested in Mr. Ferguson's report.

Swellwold Quarry, in the Cotswolds, was offered for sale by Mr. Salmon in 1991 at offers in excess of £800,000 and although there was considerable interest from both operators and investors, the property was withdrawn from the market before a sale was agreed. In 1992 Stowey Stone Quarry, just to the east of Bristol, was marketed at 'offers in excess of £1 million'. It eventually sold in 2000 for well in excess of the original asking price and it was understood that the mineral deposits there included about 40 per cent suitable for building stone. The price was for the mining element only, as a further premium was to be paid if permission were obtained for landfill.

Callow Hill Quarry, located near Monmouth, contained about 60,000 tonnes of Pennant sandstone and was offered for sale. The best offer received was for a lump sum of £200,000 payable after 2 years together with an option fee of £20,000 payable immediately and 10 per cent of turnover payable as a royalty for the first 2 years. The offer analysed out to £2.85 per tonne for the minerals in the ground, and when that figure was applied to the subject land, a figure of £165,000 resulted which, Mr. Salmon said, compared favourably with his alternative valuation of the claimants' property. Woodeaton Quarry in Oxfordshire had been valued by an expert minerals valuer in 1998 in connection with an independent expert witness report, and the resultant figure if applied to the subject property would give a value of £850,000 which, Mr. Salmon said, suggested his valuation might be way too low. Chicksgrove Quarry which he had valued for the claimant in connection with the division of a deceased's estate also threw up a much higher figure for the subject land than he had applied in his valuation.

The overall conclusion to be drawn from an analysis of all these comparables was that, as he had said, there were huge variations in values, and different methods of approaching both capital values and rental figures, and that, on balance, he considered his valuation of the claimants' land to be a fair and balanced one in all the circumstances.

Finally, in respect of Conygar Quarry which Mr. Ferguson was suggesting indicated a much lower value for the subject property, Mr. Salmon outlined the background relating to that quarry, and the legal and operational problems there had been with it over a period of many years. There had been a High Court case relating to the sale of the quarry, from which it had become apparent that the purchase price of £500,000 which Mr. Ferguson was relying upon to support his argument was a considerable under-value due to the vendor's lack of knowledge that there was an extant planning permission for mineral extraction. Once the full planning situation was known (including permission for landfill) the quarry had been valued at £2.25 million. Although there was some question over that valuation, Mr. Salmon said that with full knowledge of the background to Conygar the High Court judgment did not support Mr. Ferguson's valuation, and there was nothing to cause him to revise his own figure of £400,000.

In cross-examination Mr. Salmon confirmed that his instructions were to value the land disregarding the purpose for which it had been acquired, and that he had valued it on the basis that planning permission was granted for quarrying in connection with the construction of a road. No account had been taken of the cost of constructing the road because he knew it would not be required in the no-scheme world, and that there would thus be no market for it from a roadbuilder once the minerals had been extracted. He accepted the acquiring authority's figures for the depth of the cutting that was actually excavated at 8.46 metres (8 metres to the road surface and 0.46 metre for foundations and drainage). If it was not a permission for a road, but purely a mining or minerals extraction consent, it was likely that the extraction would have been very much deeper.

Mr. Salmon said that he had taken into account that there were no conditions applied to the deemed permission, which would be seen as an advantage as most quarrying permissions were subject to extensive and onerous conditions. For example, under the provisions of an Interim Development Order ("IDO"), Avon County Council had attempted to impose over 100 conditions on Conygar, although on appeal to the Secretary of State, this had been reduced to 54. He said that he had not considered if there would be a commercial demand in the market for land which had permission for a small section of ring road, and accepted that the extant planning permission was for that purpose and that it did not enjoy permission for minerals extraction alone. He agreed that the statement in the s.17 certificate that read: "…but would not have been granted for any other development" must include development for minerals or landfill.

Regarding the inspectors reasons for refusing permission for minerals extraction at the s.18 appeal, Mr. Salmon said that no evidence had been introduced by the claimants to support the application, but the authority put forward a full case. The inspector had therefore relied solely upon the ASP in the Council's development plan in concluding that demand was small. Mr. Salmon agreed that he had no specific evidence that there was sufficient demand for Pennant sandstone to make the extraction a viable proposition, bur reiterated that the supply from Conygar, some 8 miles from Bristol was, at the relevant date, unreliable. He said it was a circular argument – if the stone was not being quarried, it was not being sold. The circle had to be broken and once supplies became available the demand could be effectively tested. It was his professional knowledge and experience that led him to the conclusion that demand would be as set out in his valuation. He accepted that in the first couple of years of operation figures might be low, but once the market learnt of the availability of the stone, demand would increase to a point where the figures he had given could be taken as an average over the anticipated ten year operating period.

Pennant is the indigenous stone in the Bristol area, and in assessing demand prior to formulating his bid, a prospective purchaser would take that factor into account together with the fact that the only other local quarry had difficulties and was unreliable.

On access, Mr. Salmon accepted that he had not considered this aspect in detail in his original report, as he assumed that access was available. He acknowledged that Abbots Road, which was classified (C314), would need some improvement and that without access, if that were the case, the land would be valueless for minerals extraction. He accepted that there was a clause within the road building contract prohibiting the use of Abbots Road for construction traffic and that there had been an exception for the laying of the final surface of the temporary diversion - the land-bridge. As to whether or not planning permission was needed to form, lay-out or improve an access, Mr. Salmon said that that was a matter of law that he could not answer. On production by the acquiring authority of a copy of the Town and Country Planning General Development Order 1988, Mr. Salmon accepted that, on the face of it, it appeared that planning permission for access would be required according to ss.3(1) and 3(5).

A new access would be needed to allow vehicles to enter the land directly from Abbots Road at its southern end, but the contractor would be able to use the existing field access to the west. This was metalled or finished with aggregate between the field gate and the road, but might need to be widened and set back to give improved vision splays. In Mr. Salmon's view, if this did need planning permission the local planning authority would be unlikely to refuse on safety grounds. He agreed that some negotiation may be required in respect of the highway verge if this was not in the claimants' ownership, but he had assumed that it was.

A haul-road would need to be constructed for a short distance over the field between the gate and the subject land, this field being within the claimants' ownership. Planning permission would not be needed for agricultural use, but it would for quarrying. Again he thought there was no reason why the local planning authority should refuse.

Mr. Salmon said that ideally access would be taken from Abbots Road at the point where the acquiring authority provided access (to the diversion) and it was evident from photographs that some access to the site was obtained from the diverted road – as indicated by the stockpile of materials. Mr. Stone pointed out that any access was temporary, for the duration of the scheme only. The only permanent access was the new accommodation access immediately to the east of the land – this having been provided to give access to two other landowners whose land had been severed by the scheme and was permitted under the Side Roads Order, not the original planning permission. Mr. Salmon accepted that, in the no-scheme world, the accommodation access would not have been necessary, but was aware that its creation was as part of the overall development, and saw no reason why a hypothetical purchaser should not be able to construct an access at this point on the same basis.

The landfill question had also not been considered in the s.18 inquiry, but Mr. Salmon said that the Council would wish to see the land restored once the minerals extraction had been completed, and if the same lorries that were collecting the stone delivered the waste materials wherever possible, the increases in traffic would be only marginal. He said that if the inspector had had evidence on this aspect, he might have reached a favourable conclusion. There was no question that that the assumed and actual planning permissions did not extend to landfill, and a separate application would be required.

Whilst accepting that the hypothetical purchaser of the land would be a minerals operator who would have no intention of constructing a section of road, Mr. Salmon said that if the local planning authority's enforcement officer were to visit the site, and conclude that the road permission was not being implemented, there would be nothing he could do to prove that that were the case until an application for landfill was made. As he had said, there was nothing in the permission that made implementation of it obligatory. Until the landfill application was made, there was nothing that would indicate the permission was not being implemented in that the first stage of the development process – the formation of the cutting – was being carried out. The purchaser, whilst not completing the development, would be implementing it in part.

Mr. Salmon accepted that planning permission for a road and planning permission for the extraction of minerals were different in nature and character and that the conditions imposed were likely to be different, but in this case there were no conditions imposed in connection with the road permission. A minerals operator would approach the excavation differently to a road builder. He would strip the top soil and put it to one side for re-use in the restoration works. He would remove the bulk fill, and then very carefully remove the Pennant sandstone, causing as little damage to it as possible. It would often be sorted by hand with the walling/rockery stone stored on site for customers to inspect and collect, and the building stone removed to a place where it could be cut and dressed.

A road builder would take a different approach, using the topsoil and bulk fill elsewhere on the scheme, and blasting the rock with explosives, then removing it all from the site and tipping it elsewhere. It was accepted there would be no need for the same care to be taken with the stone in purely roadbuilding terms.

As to the potential drainage problems there was some question of exactly which of the boreholes (taken in 1982 and 1985/6) were actually on the claimants' land, although it was accepted that some which may have been on the line of the new overbridge, immediately to the south of the subject land, were in very close proximity. Mr. Salmon's interpretation of the results was that there appeared to be no evidence that water was struck on drilling, but seeped into the holes from the fissures in the rock. One of the boreholes was only 1 metre deep so, he said, that was not much help. Having said this, Mr. Salmon accepted that one of the Exploration Associates reports noted that artesian conditions could exist, and that a hypothetical purchaser would conclude from that that he might have to cope with some water problems.

It was necessary for a quarry to be dry, but there would be no problems in draining water onto the claimants' retained land, for which the necessary rights would have been negotiated. No licence was needed unless the water drained into a watercourse, and, if necessary a sump could be dug to hold the water extracted from the quarry.

Mr. Salmon accepted that, in respect of his comparables, the only two quarries that had been sold (apart from Conygar which was considered to be at an under-value) were Cotswold Hill and Stowey Stone quarries. Only Cotswold Hill was comparable in size – all others being larger in terms of reserves. He said that he had no actual evidence to support the 50 per cent royalty rate he quoted, and accepted that in an article he had written in Minerals Bulletin in 1992 he had referred to 40 per cent of net profit (which was the same as the gross margin he had referred to earlier). The 50 per cent he quoted equated to about 15 per cent of turnover, and this was supported in his evidence and by Portland Quarry and also Ashen Cross.

Finally, in connection with the Conygar Quarry, it was put to Mr. Salmon that the High Court judgment had adopted a valuation of £650,000 which was very different from the £2.25 m referred to by him. He said that the £650,000 excluded any quarrying rights, and was for tipping only. The judge's valuation was, therefore, on a different basis. As to the effect on demand for Pennant sandstone, Mr. Salmon said that, as far as he was aware, the Conygar quarry was not actually operational at the relevant date.

ACQUIRING AUTHORITY'S CASE

Mr. Roberts gave evidence of fact relating to his involvement with the scheme as Principal Resident Engineer supervising the construction of Stage IV A of the Avon Ring Road. He has 34 years experience in respect of highways construction and whilst at the relevant date he was employed by Avon County Council, he is now a self-employed civil and highways engineering consultant.

He confirmed that the subject land, between chainage 1609 and 1813, lay towards the middle of the 2.8 km section that formed the totality of Stage IV A and explained what happened to the surplus material excavated to form an 8 metre deep cutting. The materials from the south of the temporary land-bridge, which was formed on the claimants' land just to the north of the line of the original Abbots Road, were taken to three separate tips that had been acquired by the contractor close to the development. The materials from the cutting formed to the north of the diverted road were taken further north in the scheme, where there was no cutting, to form a noise attenuation bund.

Once the new overbridge had been built, the land-bridge that was estimated to amount to about 10 per cent of the total materials removed from the subject land, was removed and used to construct a cycle-way and the access to a nearby footbridge, with any surplus being carted away and used, Mr. Roberts thought, in connection with the construction of the Bristol Spine Road.

The excavation had taken place in 3 stages, with the topsoil taken to a stockpile on the claimants' retained land, the stony material to a depth of 4 metres removed by 'box scraping' and the remaining 4 metres or so of rock broken up by 'pre-split blasting' and then removed by normal methods. A total of 56,114 cu.m. of materials were removed at a cost of £185,098.

Mr. Roberts said that he was aware from the borehole surveys that had been carried out prior to the commencement of the scheme that the stone was of poor quality and badly fissured. The fact that part of the cutting had to be supported by retaining walls (faced with Pennant sandstone) reinforced this opinion. Even though the Council had to negotiate the acquisition of suitable tipping sites for the surplus materials and obtain the requisite planning permission, he thought that this was still a cheaper option than cutting and selling in the manner propounded by the claimants.

In cross-examination Mr. Roberts accepted that he was not a geologist or a minerals surveyor, and that he had relied in part upon the report of Exploration Associates in forming his views as to stone quality. There was also some question over whether three of the trial holes were actually on the claimants' land but in any event, he said, the fact that part of the cutting needed to have retaining walls, and the fissured nature of the rock to the exposed sections, supported his views. He accepted that the bore hole evidence that had been put forward suggested the stone quality as variable rather than poor.

He agreed that the pre-split blasting method of breaking up the rock would cause more damage to it than the traditional mining methods but the contractor was not concerned with preserving it as it was to be carted away and used elsewhere on the scheme or tipped . The quantities he had referred to had been provided by a quantity surveyor, and Mr. Roberts said he had calculated the cost of extraction from the prices supplied by the contractor – Gleesons.

Mr. Perry is a Chartered Civil Engineer, and at the relevant date was employed by Avon County Council as a Senior Resident Engineer (Structures), reporting to Mr. Roberts. He was responsible for the site supervision of all structures for the scheme including the retaining walls and the pre-split bulk blasting of the earthworks cuttings. He explained the procedures for the blasting of the rock, and that that method could not be used in the vicinity of the foundations that were being prepared for the new Abbots Road bridge, or around the land bridge where there was also a diverted water main. Even in those areas, where the stone was removed by mechanical digger, Mr. Perry said none of that won was useable for building stone and had to be used as general fill or removed from site.

Mr. Perry said he recalled that the stone used for facing the retaining walls that had been necessary due to the steep sides of the cutting and the weak nature of the rock, had been brought in from excavations to the south of the subject land, closer to the Avon Bridge. None of the facing stone had come from the claimants' land, due to its variable quality.

Some of the stone from the claimants' land was used for the base for the road construction, and a mechanical crusher had been brought to the claimants' retained land, where the stockpile was situated, for this purpose. Other material was removed to the sound bund referred to by Mr. Roberts, but none of those operations required the use of Abbots Road which, he confirmed, had not been used as a method of access and egress to the scheme except in connection with the initial construction (over a period of 2 or 3 months) and the final surfacing of the temporary diversion. Once the diversion had been completed, there was a clause in the contract that prohibited the contractors from using it. The diversion was open for about 13 months from 23 March 1992, until the new road bridge was opened.

There were haul roads provided to both the south and north of the diversion, together with a concreted and traffic light controlled crossing point allowing the contractors to cross the diversion to get from south to north and vice versa, but not, he stressed, to allow general access to the site via Abbots Road.

In cross-examination, Mr. Perry agreed that the retaining walls had only been used for about 30 metres of the 204 metre section of road and that his comments regarding the variable quality of the stone were purely his opinion. His comments relating to what happened to the stone once it had been extracted related, he said, to the whole scheme and not just the claimants' land. He did not think that any additional planning permission would have been required to allow access at each end of the diversion road onto the remaining original sections of Abbots Road to the east and west, as this would have formed part of the original planning permission for the scheme.

Mr. Webb is a chartered surveyor with 28 years experience in the civil engineering industry, and was employed by Avon County Council as Group Leader (Contracts) responsible for the pre-contract elements of the scheme including over-seeing the preparation and checking of tender documentation and bills of quantities. In commenting on whether the minerals in the claimants' land were considered to be a valuable resource by the contractor, he said that an analysis of the costings showed that they were not. The quoted rates indicated an additional charge of £0.50 for disposing of 'normal material' off-site, and an extra £0.73 for rock. If there had been any sale-value in the materials, that differential would not have applied.

The contractor was also instructed to use rock from the scheme for the creation of the facings to the retaining walls, and this resulted in an 'extra-over' charge because of the considerable extra processing (cutting & dressing) costs that would be incurred.

Mr. Webb said that the contractor's final account for the whole of the scheme had been analysed to determine the cost of the section that related to the claimants' land. The road costs for that section were £630,777.68; the cost of constructing the Abbots Road bridge was £431,069.38 – of which half could be attributed to the claimants' land and the total therefore was £846,312.37.

Mr. Webb accepted in cross-examination that it was at the tender stage that the contractor attributed no value to the rock or other materials – before they had been extracted. He was unable to say exactly where the stone came from for the construction of the facings to the cutting, only that the contractor had been instructed to use local stone.

Mr. Phillips is a civil engineer who has worked in the field of highway design and supervision for over 30 years. At the relevant date he was employed on the scheme as a Section Engineer which included the management and supervision of a team of engineers engaged in the design of the scheme, production of contract documentation and liaison with the Council, other public bodies and landowners. He set out the background to the scheme including the strategic importance of the ring road, the process of public consultation that took place in the choice of which of a number of alternative routes was to be chosen, the planning process and issues relating to the design and construction of Stage IV A and the relevance of these matters in the context of s.5(3) of the 1961 Act.

Following the publication in 1982 of the consultation draft of the County Structure Plan, which included policies TR1 and TR3 relating to the Primary Road Network including the Avon Ring Road, the examinations in public in 1983 and the Secretary of State's proposed modifications published in 1984, the Secretary of State approved it in that year.

In connection specifically with Stage IV of the ring road, several routes were considered, but only two of these (known as the purple and orange routes) were deemed to be practical on cost, environmental and operational grounds. The purple route was based upon the existing protected route at the time of the consultation, and the orange route which ran further to the east, and through the claimants' land, was cheaper and had less environmental impact although it was operationally less advantageous. A full appraisal of the two routes and their variations was prepared based upon such factors as topography, soil conditions, engineering feasibility, costs, environmental impact and operational costs. These were presented to public meetings and exhibitions in late 1984 and early 1985, and following consideration of the responses, the orange route was adopted as the preferred route by the Council in April 1985.

Subsequently, following submission of the planning application details for the scheme to the Secretary of State, because the new preferred route did not accord exactly with the then current Structure Plan, and his decision not to intervene, permission was finally granted by the Planning, Highways and Transport Committee of the Council on 29 January 1988.

Further amendments had been made to the draft Structure Plan in late 1984 which included modifications to the route for the Avon Ring Road between the A431 and the A4 to bring it into line with the County Council's adopted route as set out above. Following public consultation, the Secretary of State gave final approval to the Structure Plan First Alteration in December 1988.

Mr. Phillips explained that during the consultation process, at which time the orange route was shown to run at ground level in the vicinity of Abbots Road, there had been concern about the impact on Hanham Hills and a nearby Conservation Area, so it was decided to mitigate the effects by lowering the road into a cutting in the vicinity of Abbots Road. The sound bund proposed for the west of the road [to the north of the subject land], the material for which would come from the creation of the cutting, would also help to mitigate the effects of the scheme on nearby residential developments.

Referring to the site investigation works that had been undertaken by Exploration associates in 1982/3 and 1985/6, Mr. Phillips said their factual and interpretative reports stated that is was to be expected that the quality of the Pennant sandstone was likely to be variable and that it was inevitable the side slopes would need strengthening in some areas. It also referred to the presence of a high water table north of the Willsbridge fault [south of the subject land and Abbots Road] and artesian conditions could possibly be present.

As to access to all the land required in conjunction with the scheme, Mr. Phillips said that the use of Abbots Road was dismissed as a possibility at a very early stage because of the sub-standard width, alignment and lack of pedestrian facilities of this rural road that was also known to be well used by equestrians. Access for construction traffic would, therefore, be principally from the north and south of this section of the scheme.

The highway and land drainage was considered to be a fundamental issue in the design of the scheme, and it was necessary to channel water down to the river Avon, about ½ mile to the south of the subject land, due to the sloping nature of the land in that direction, and the non-availability of natural watercourses in the vicinity. This option, he said, would not have been available to a minerals operator in the no-scheme world, and neither would the opportunity to construct a single drainage pipe into a historical pond adjacent to no. 134 Abbots Road, which had been carried out as part of the scheme due to the earthworks having caused the pond to dry up. Mr. Phillips said that the subject land flooded to a considerable depth during the construction works.

In cross-examination, Mr. Phillips agreed that the adopted orange route which affected the claimants land was not the original preferred route, this being why the planning application had to go to the Secretary of State. The reason why the adopted route was, in operational terms, less advantageous, was due to increased travelling time compared with the purple route, and some additional cost, as calculated in the cost benefit analysis. The orange route was slightly longer, in that it swung further across to the east, but that was only one of the factors to consider in looking at the overall scheme. The orange route negated the need for the road to go through several villages, as the purple route would have done, and there were therefore considerable environmental advantages to swing the balance.

Mr. Phillips accepted that the orange route, during the design and consultation phase, had been subject to a number of minor modifications. For instance, one proposal was for the orange route to run approximately 200 metres to the west of that which was eventually adopted but this one, which would not have affected the claimants' land, was rejected on the basis that it would have created a more noticeable scar on the landscape. Similarly, another proposal to move the route further east, again without crossing the claimants' land, would have meant the road passed directly through the Hanham Hills, and the environmental impact would have been much more severe. There had also been a number of other routes considered when devising the overall scheme, including the originally preferred purple route and some modifications to that. Mr. Phillips agreed that the Ministry of Agriculture, Fisheries and Food ("MAFF") [as it was then known] had preferred the purple route as it would have had less impact on agricultural land but, again, this was only one of many considerations that were taken into account and, on balance, the orange route that was eventually adopted was seen as the best option. Such matters as traffic noise, effects on adjacent property, on Hanham common and Hencliffe Wood made the orange route far superior to the purple one, and, he said, the choice of the orange route had not subsequently been challenged.

In connection with access to the land, Mr. Phillips agreed that there were no restrictions in the planning permission or the Side Roads Orders that would restrict the use of the accommodation access that had been created immediately to the east of the land. That access was for the claimants' retained land as well as for the other two landowners.

Mr. Slane is a civil engineer and a Fellow of the Institution of Highways and Transportation with 31 years experience in relation to planning and development of highways. His report dealt with the highways implications that would arise if the land were to be utilised for commercial mineral extraction purposes, and the question of access.

He said that the C314 Abbots Road varied in character in that at each end it was urban but the centre section was predominately rural with a number of sharp bends, no pedestrian facilities and narrow verges and narrow parts where the carriageway was less than 9 metres wide.

In October 1991 two-way traffic flows were in order of 4,780 vehicles per day over a 12 hour period, and there was a high incidence of injury accidents (six over a 4 year period on Abbots Road itself, with others at various junctions). Mr. Slane produced a series of photographs to demonstrate the narrow and rural nature of Abbots Road in the vicinity of the subject land and highlighted the 'squeeze points' where the highway was less than 4 metres wide. Access to the subject land and the claimants' retained land was now through a total of 5 field gates located in this rural section, three of which were unimproved, less than 3 metres wide and with poor visibility. The other two were created as part of the scheme and included the new accommodation access to the east of the scheme road. Mr. Slane said that the access which Mr. Salmon was referring to as suitable for the minerals lorries was one of the two lying to the west of the subject land where visibility for exiting vehicles was virtually nil in each direction and the access gate was angled obliquely to the road. There was not room for two commercial vehicles to pass through the gate at the same time, with the result that an entering vehicle would have to wait on the highway until the leaving vehicle had cleared.

As the access was into the claimants' retained land, and not directly onto the subject land it would be necessary to construct a haul road across the field from the gate to the proposed workings, and this, together with he need to improve the access would require additional specific planning permission that would fall to be considered under policy KLP40 of the Kingswood Local Plan in addition to normal road safety concerns. In the light of this, it was Mr. Slane's view that the existing access would be insufficient to provide a proper and acceptable point of access for the proposed operations.

The planning permission for the scheme did not include for the formation of an access onto Abbots Road for construction purposes and as it was a classified highway it would need planning permission for the formation of such an access for this purpose. Any permission that were granted would have to take into account the need for visibility splays and, Mr. Slane said, it had been generally accepted at the s.18 appeal inquiry that a 90 metre splay length would be appropriate although there had been a difference of opinion over the set-back depth (the authority saying a minimum of 9 metres, and the appellant saying 4.5 metres). Due to the configuration of the claimants' land, there was insufficient to provide the minimum possible splay without encroaching upon land that falls outside the claimants' ownership.

The road safety considerations that would have to be taken into account were set out in the Department of Transport's Circular 4/88 and there could be no doubt, in Mr. Slane's view, that the carrying out of mineral extraction operations on the land would result in a considerable increase of heavy commercial vehicles. Referring to Mr. Salmon's volume assessments, Mr. Slane said he estimated an average 20.8 HGV trips per working day (based upon a ten year operation) as a minimum which allowing for seasonal and daily fluctuations, could increase the number to between 42 and 62. Add on the daily movement of the site operatives together with visitors and deliveries, a further 20 to 25 daily trips could be anticipated. Furthermore, he said, as it would be unlikely that planning permission would be granted for the storage of overburden on land near to the site, it would have to be transported away. Again, using Mr. Salmon's figures, Mr. Slane estimated that the number of vehicles per day could well increase to 100 for a short period during the initial development of the operation. Similar results were achieved from extrapolating Mr. Ferguson's figures.

In connection with the landfill operation to be undertaken both during and after the quarrying exercise, Mr. Slane said he did not accept Mr. Salmon's hypothesis that many of the lorries that brought in landfill waste would take out the clean minerals material. He thought that would be a predominantly different exercise but allowing for a 'modest' return trip scenario and for the indisputable 'bulking factor' that applied to inert waste, there would be an additional 25 HGV trips per day. Taking all factors into account, it was Mr. Slane's view that a total of between 112 and 162 vehicle trips per day would be created, of which 92 to 137 would be by large commercial vehicles - this being an increase on the existing very low HGV levels (7 per day in one direction, and 14 in the other according to the traffic count survey) of between 438 and 652 per cent.

The highways authority would undoubtedly object to this sort of intensification of traffic, and planning permission would be refused.

In cross-examination, Mr. Slane accepted that the accommodation access to the east of the subject land was not subject to any documented restrictions on use in terms of the planning permission (for the scheme) or the Side Roads Orders, but he thought that being access to fields, there would be some constraints on use. It was noted that the land for the accommodation access was still in the claimants' ownership, and the formal transfer to the acquiring authority had not yet occurred. No restrictions or rights could, therefore, have been imposed or granted at this stage.

On the subject of access generally, whilst the site could be accessed freely and properly by the acquiring authority in connection with the construction of scheme, Mr. Slane stressed that the planning permission did not grant any public right of access, and could not realistically be interpreted as doing so. The need for vision splays was something that the claimant had not argued at the s.18 inquiry, and Mr. Slane accepted that the highways authorities have some flexibility on set back depths – some cases being reduced to 2.4 metres, but in this instance he thought there would be serious objections to any such reduction bearing in mind the nature of the road onto which access was being sought.

In response to questions over Mr. Slane's interpretation of Mr. Salmon's figures for assessing additional vehicle movements, Mr. Slane said he accepted that it was not appropriate to apply a bulking factor to the materials leaving the site, but a factor of at least 1.5 was right for inert waste being brought in for landfill. Although Mr. Nardecchia performed a detailed breakdown of Mr. Slanes's figures to show a lesser number of vehicle movements than Mr. Slane had estimated, and the parties were unable to agree on precise numbers, Mr. Slane said that the local planning and highways authority would look at 'high spots' rather than averages and in his view his figures were not excessively wide of the mark.

On the assumption that planning permission did exist for mineral extraction operations, and on the basis that there was no other possible access to the site, it was put to Mr. Slane that it would be irrational for the local planning authority to refuse permission for improvement of the existing field gate access and construction of a haul road, on the grounds that to do so would result in safety aspects being compromised. He said that in his view planning permission did not exist for the mineral extraction – in fact it had been specifically refused in the s.18 appeal. To make the assumptions he was being asked was, he said, "a step too far". The planning permission was for a ring road, not a minerals operation and it was difficult to comment upon a situation that was totally alien to that. However, even if it were the case that planning permission did exist for minerals extraction, the highways and safety objections could not be ignored – indeed considerable weight would be given to them. Ultimately it was a planning matter, and in his opinion the planning situation that the claimants were trying to prove just did not exist.

As to whether or not planning permission may be gained for landfill, Mr. Slane said that despite his acceptance that there was a need for landfill sites, and it was the County Council's policy to restore sites that had been quarried, the additional traffic that would be generated would raise the same highways objections as the extraction operations would. Restoration, he said, did not necessarily mean landfill – there were many sites that had become water parks or had been landscaped without being totally levelled. Mr. Slane pointed out the inspector's comments in his report on the s.18 application and the need to balance the benefits of restoration against the probable increases in traffic for the duration of the works.

Mr. Ferguson is a chartered surveyor and a Principal Valuer in the Mineral Valuer South office of the Valuation Office Agency. He qualified in the Minerals Division (now the Minerals and Environment Management Division) of the Royal Institution of Chartered Surveyors, and has 27 years experience in the valuation minerals and associated property with the Office of the Inland Revenue, and latterly the Valuation Office Agency.

He referred firstly to the presumption made by Mr. Salmon in his report that stated, inter alia: "that, the hypothetical purchaser would be entitled to take the view that the Deemed Planning Permission entitled him to prepare the site for road construction and in so doing excavate and sell the minerals and return the land to its original contours by the importation of inert waste". This presumption, he said, was flawed since it would be only a partial implementation of the Avon Ring Road, Stage IV A on the claimants' land. It would not be in accordance with the planning permission because it would not result in the construction of the road, or even a part of the road. The proof of that would be that the road would not connect for the use of traffic at the northern and southern boundaries of the subject land and, as Mr. Salmon's report admits, its real purpose would be the extraction of minerals. There was no extant permission to work the minerals and the s.18 determination would seem to preclude the hope of obtaining such a permission.

On the basis of Mr. Salmon's presumption that the hypothetical purchaser would be a minerals operator who would 'prepare' the site for the construction of the road, and who would see the only economic return in the mineral extraction element, that purchaser would need to assess the potential return before formulating his bid. He would not, at the outset, have the benefit of the exposed cut faces that are now visible, and would, therefore, need to rely upon any available previous investigations, or his own research. The 1987 report by Exploration Associates (Warwick) Ltd largely confirmed the sequence of strata that can now be seen in the actual cutting. The water table was found to be high in the vicinity of the subject land, with the possibility of artesian conditions existing. Hard rock quarrying, such as the extraction of Pennant sandstone needed dry conditions, and if the possible drainage problems did not deter the purchaser altogether, he would need to arrange for the necessary extraction and discharge licences, and negotiate with the adjoining landowner. The prospective purchaser would also be aware of the 'Willsbridge Fault' from available geological maps, and although it was slightly to the south of the subject land, he would be concerned that rather than being a single fissure, it might spread out, thus affecting the prospects of there being a clean stone face.

As to demand, the prospective purchaser would be aware of Conygar quarry which, Mr. Ferguson believed, was open at the relevant date and producing high quality road aggregate together with a small quantity of building stone. It was operational, had extant permissions for quarrying and infill, and had reserves of 2 million tonnes whereas the subject property was a 'start-up' situation – whether planning permission existed or not. Conygar quarry actually went into receivership in August 1992, and has not operated since. That, he said, seemed to indicate that there was probably very little market for such stone in the locality, and a purchaser would need to be convinced that such a demand could be found. The size of the subject land, and the potential reserves were not considered sufficient to be of interest to a national company.

Considering ss.5(2) and 5(3) of the 1961 Act, Mr. Ferguson said that in the absence, or reasonable prospect of, obtaining planning permission for mineral extraction, he was of the opinion that the value of the land was not enhanced by the presence of minerals. Additionally, if one were to assume that the s.18 determination gave authority to the landowner to excavate the cutting it must be undertaken as part of the implementation of he full permission, including the actual construction of the road. The cost of such a project, he said, would far outweigh any possible value in the minerals removed. The fact that the s.18 determination post-dated the valuation date was noted, but Mr. Ferguson thought that if a prospective mineral operator had approached the Council at the relevant date, they would have stated their opposition to the prospect of a minerals extraction operation.

Having said this, Mr. Ferguson said that he had included, for the sake of completeness, an opinion as to the value of the minerals on the basis that planning permission could be obtained, or assumed, for the development of a minerals project. He had prepared three valuations [see Appendix 3 to this decision], the first being a comparison with Conygar quarry, and the second and third on the assumptions that the subject land would be used as either a bulk fill quarry or a building stone quarry.

From the figures supplied by the Council's Mr. Roberts, Mr. Ferguson assumed 23,221 cu.m. of overburden, and 30,996 cu.m. of essentially Pennant sandstone. It would be necessary to leave a barrier of material to support the existing Abbotts Road, and assuming this to be 15 per cent of the total, had used in his valuation 20,000 cu.m. (50,000 tonnes) of overburden and 26,350 cu.m. (58,000 tonnes) of sandstone as available for extraction. From his experience of quarries in the area generally, Mr. Ferguson said that only 50 per cent (29,000 tonnes) of the stone was normally suitable for dressing and sale as building stone. The rest would need to be disposed of as hardcore. Although Mr. Perry had said that none of the stone extracted from the scheme was considered suitable for sale, he had adopted this 50 per cent for the purposes of his 'hypothetical' valuation. As a stone quarry, based upon the average production at other quarries, Mr. Ferguson thought the quarry would have a life of 25 years.

As a bulk fill quarry, there was potentially 108,000 tonnes of material available and half of that would require processing in a crushing or screening plant that would need to be brought to the site. The material would need to be dug and disposed of in a short space of time (about 2 years) and its value would be limited due to the availability of similar materials from many other sites.

As to landfill, Mr. Ferguson had attributed no value to this aspect as no planning permission existed, and the potential flooding problems together with the subsequent stringent conditions that would be applied in the grant of any planning permission would make it uneconomic.

In assessing the appropriate rents or royalties Mr. Ferguson used information from the Rating list provided by occupiers under the provisions of s.82 of the General Rate Act 1967. Whilst there was no direct relationship between the rateable value and likely rent of any particular quarry in October 1991, the figures derived from the Unrestricted Rateable Values (URV's) and the Rateable Values (RV's) did give an indication, he said, of the general level of rent one would typically expect for such a venture at that time. From the schedule that he had produced, he said the mineral rents of the active quarries were typically in the range £2,000 to £4,000.

Mr. Ferguson said that actual royalties paid varied considerably from quarry to quarry depending upon the actual mineral and the type and quality of the product, but usually fell within the range of 5 to 10 per cent of the selling price. Having regard to the fact that none of the material in the subject land was considered suitable for high-quality building stone, Mr. Ferguson said he had adopted £0.20 per tonne as an appropriate royalty if the material were extracted on the bulk fill quarry basis. Bearing in mind the highly fissured nature of the stone that was both now apparent and had been anticipated in the Exploration Associates report, investment in the sophisticated machinery for producing high quality, dressed building stone would not be justified, and it was more likely that an operator would go for lower priced walling and semi-dressed stone. To this he had applied £4.00 per tonne, with £0.25 for the waste material and £0.15 per tonne for the inferior material within the overburden.

Other quarry operators had been approached in order to obtain rents and royalties information, and Mr. Ferguson said he had been successful in 3 cases. The figures provided from Swellwold, Oathill and Bixhead quarries supported the ones he had used in his valuation.

Mr. Ferguson said that a prospective purchaser would take into account the sort of conditions that it was normal to expect to be applied to a planning permission, and produced an example from a quarry in Cornwall. He said he did not think Mr. Salmon's comparables were particularly helpful as they were mostly much larger operations, and Cotswold Hill quarry was not an arms length transaction, one of the owners having granted a lease to himself and another person.

In cross-examination, Mr. Ferguson agreed that there was not much between him and Mr. Salmon as to their opinions on the quality of the stone, in broad terms, and that both of them had made substantial allowances for the fissured nature of the stone. On the subject of the abstraction of water from the land, it was accepted that under s.24 of the Water Resources Act 1963 a licence was not required, but Mr. Ferguson thought there could well be problems in getting rid of the water, especially if it was not clean. A sump (which Mr. Ferguson thought may require planning permission) may have to be dug on the adjoining land, in the absence of suitable watercourses or ponds in which to drain, and this would be a cost implication. Also, at the time the hypothetical purchaser was formulating his bid, he would not be aware of the actual flooding that took place during the construction of the road, and would only have the investigations to rely upon – which suggested artesian conditions might exist.

It was suggested to Mr. Ferguson that, in respect of his opinion that the cost of the construction of the road would have to be taken into account, if there were two separate stages and two separate contractors the cost of the road construction would fall on the second contractor. There was nothing to stop the first contractor taking the profit for the minerals extraction, and then giving the land to the second contractor who would not be obliged to, nor have any need to, construct the road. Whilst this scenario was a possibility, Mr. Ferguson said that it would be difficult to find a purchaser (the first contractor) who would foresee any potential profit in the minerals extraction for the reasons he had given. Mr. Salmon, he said, had painted a very rosy picture of the potential at the subject land. If the quantity and quality of the materials were sufficient to anticipate profit being made from the extraction of the stone, then a minerals operator might bid, but he would still have to take into account all the down-sides such as possible flooding problems.

It was accepted that a bid had been received for Conygar quarry, but as to the £500,000 purchase price upon which Mr. Ferguson had based his comparable valuation, Mr. Nardecchia pointed out that when that price was negotiated the parties were unaware of the extant planning permission for quarrying, and it was made on the basis of a permission for a scrapyard. Even though by the time contracts were exchanged for the purchase, the buyer had been made aware of the quarrying permission, the vendor had not. That figure could not, therefore be taken as the value and that, indeed, was accepted by the judge in the High Court case that ensued. Mr. Ferguson did not accept that £500,000 was inappropriate and pointed out the judge's comment that he did not accept the purchaser would necessarily have paid more to secure the land as a quarry. Mr. Ferguson considered that figure to be a fair and reasonable basis for his comparison in the first of his three valuations.

As to the conditions that were likely to be imposed in respect of the Conygar permission, Mr. Ferguson accepted that if there were no conditions, nor the possibility of such being applied to the subject land, then the hypothetical purchaser's bid would reflect that situation. However, he would still consider the possible problems over access, enforcement and the like.

Mr. Ferguson did not agree with the suggestion that the £4 royalty figure he had used in his valuation as a stone quarry was low in comparison with the figures that had been put forward by Mr. Salmon including Cotswold Hill quarry at £8.77 per tonne. He said he thought that the Cotswold rent was not an arms length transaction, although apart from a letter from the new owner of that quarry and a copy of part only of the lease he had referred to, he could produce no other evidence to support that contention. In any event, bearing in mind all the inherent problems with the site and the stone quality, Mr. Ferguson said he was satisfied his figure of £4 was appropriate. Nevertheless, he reiterated that in reality rather than in terms of his hypothetical valuations, the land could not be looked on as a suitable prospect for a minerals development that would attract bids. The assumptions that he was being asked to make by counsel for the claimants were unrealistic.

Mrs Mawby is a chartered surveyor and acting Consultancy Manager (Valuation) for the Property Consultancy of South Gloucestershire Council. She was previously, and at the relevant date, with the acquiring authority dealing with compulsory purchase and compensation matters. In her original valuation report prepared as a basis upon which to assess compensation, she concluded that the value of the land lay in its existing use value (as horse grazing and agricultural) in the sum of £17,000 – a figure that had been agreed with the claimants' valuer as its value for those purposes.

The permission in the s.17 certificate granted on appeal for sports pitches had no value, as the cost of the required improvements to Abbots Road would outweigh any value for that use. That had also been agreed.

In her supplementary report she considered the scenario in which a hypothetical purchaser may seek to exploit the Council's planning consent to build a road by using it to extract minerals. She said that at the s.18 appeal the inspector considered the arguments for mineral extraction in some detail, and dismissed them because demand would be small, and of little weight in relation to the significant environmental objections. It could not, therefore, have been the inspectors intention that the revised s.17 certificate granted on appeal should be interpreted in such a way as to allow minerals extraction without conditions.

The improvements that would be required to Abbots Road (which were the subject of conditions in connection with the sports pitches permission) would be similarly required for minerals extraction. In any event, Mrs Mawby said that the plans for the scheme design in respect of Stage IV A of the Avon Ring Road do not provide for access onto Abbots Road from the land for construction traffic. The purchaser would need to create a viable access onto Abbots Road, such access not being in existence at the relevant date, and for that, planning permission did not exist and would be required. The new accommodation access that had been referred to in evidence was permitted under the Side Roads Orders and was purely to mitigate the effects of severance which would not, of course, be the case in the no-scheme world. The field accesses into the claimants' land that were existing at the relevant date were not directly on to the subject land, and a haul road would need to have been constructed across the retained land to give access. That again would require planning permission as it was not for agricultural purposes. Similarly, in Mrs Mawby's opinion, permission would need to be obtained for construction of a drainage sump on the retained land as this constituted an engineering operation.

Mrs Mawby said that the claimant could not take the benefit of the valuation basis without also taking the burden which in this case was the cost of completing the 204 metre section of road, together with half the cost of the construction of the new bridge. The drainage problems also needed to be taken into account and the argument that permission might be given for landfill was, in her opinion, fallacious. With no landfill, there could be no after-use as paddocks.

Mrs Mawby said that the hypothetical valuation arguments put forward by the claimants could not be sustained. Even if the basic concept was accepted of a minerals operator buying land with permission to build Stage IV A of the ring road because of the perceived advantage of extracting minerals without any conditions, a path of increasingly absurd assumptions was embarked upon. One needed to envisage a world where x tonne lorries of x metres width were regularly using a narrow, twisting country lane (with 3.8 and 3.7 metre wide squeeze points) through a quiet residential hamlet, adjoining a conservation area, at all hours. Water from the hole that the developer excavated could flood unchecked over adjacent farmland for the benefit of the cattle. Adjoining landowners would see their ponds dry up. The developer was immune from any of the safety or environmental controls that would normally be imposed for minerals extraction because he enjoyed a planning consent granted to a highways authority for the construction of a road. The final absurdity, she said, was that the developer was allowed to extract the minerals without delivering the road itself. Any one of these assumptions was alone unlikely, but together they were ridiculous.

In summary, Mrs Mawby said that when the cost of the construction of the road was taken into account, a negative value applied, whichever valuations (those of Mr. Salmon or Mr. Ferguson) are used. For instance, the highest valuation of Mr. Salmon at £400,000 was more than negated by the £846,000 road costs.

In cross-examination Mrs Mawby accepted that access had been obtained onto the subject land from Abbots Road, but only in connection with the surfacing of the temporary diversion. She said there was a contractual restriction preventing access to the land throughout the duration of the construction work and insisted that would apply despite the suggestion that there were no planning or statutory conditions preventing access. She said that the road from which access would have to be gained was a temporary diversion whilst the new bridge was being constructed, and that would not have been necessary in the no-scheme world. Mr. Nardecchia said that photographic evidence showed that access was gained onto the subject land during the course of the scheme, this being apparent from the stockpile of materials immediately on the roadside. Mrs Mawby said that she was unaware of any such access having been gained.

As to the accommodation access, Mrs Mawby said that she understood this was not part of the s.17 claim as it was not permitted under the actual planning permission for the scheme, but was created under the separate Side Road Orders. The access was not required as part of the scheme, but only to give access to land that had been severed by it. She said that if the claimants were claiming compensation for a different use (other than agricultural), then there was no way they could rely on that as a means of access in the hypothetical situation that was being argued.

On the access point generally, Mrs Mawby said she thought the highways objections would outweigh any argument to the effect that if the extraction was permitted, there could be no rational reason for the local planning authority to refuse the upgrading or improvements to the access. She thought the claimants' scenario that if planning permission existed for the short section of road, the planners would wish to facilitate adequate access for the extraction of the minerals was a nonsense. If that were really the case then the planning authority would have to consider the access situation, but in the scheme world it did not have to as there was no need or reason for anything other than the short, temporary access to Abbots Road (for the surfacing).

Regarding the benefit and burden argument, Mrs Mawby did not accept the claimants' argument that one contractor could extract the minerals, then leave the site for a roadbuilder to complete. As a principle of compensation, the claimants could not 'cherry-pick' those points they wished to disregard and those they did not. Although she could not point to any authority that said that, she said it was a logical extension of rule 2 to s.5 of the 1961 Act – nobody would make a bid without taking fully into account all the potential costs and pitfalls.

The fact that the minerals operator could not be obliged to construct the road once he had completed the first stage of the process did not, in Mrs Mawby's view, preclude the purchaser from having to take the costs into account. By carrying out only the first stage of the process the minerals operator would be abusing the planning process, although she accepted there was no risk of action from the Council for not completing the development.

CLOSING SUBMISSIONS

Looking first at the statutory position under the 1961 Act Mr. Stone, for the acquiring authority, said that under s.5 Rule (2) the fundamental principle depended upon what use or activity the land might be put to. The assumptions as to planning were set out in ss.14 and 15.

S.14 dealt with the assumptions to be made as to planning permission, whereas the claimants were talking about planning permissions, in the plural. S.14(1) required the assumption of planning permission and s.14(2) required that assumption to be in addition to any permission in force at the date the Notice to Treat was served. That was agreed to be Stage IV A of the Avon Ring Road, and no other actual permission fell to be considered.

In addition it was necessary to bear in mind that s.15(1) said it shall be assumed planning permission would be granted in accordance with the proposals of the acquiring authority, and it was submitted that those proposals were Stage IV A.

It was also necessary to assume that planning permission would be granted for uses certificated under s.17. In this case that was for sports pitches and the s.17 certificate made clear that in addition to the acquiring authority's proposals, no other permission was to be assumed. The cost of the road improvements required by the permission in respect of that use was agreed between the parties to outweigh any value for that purpose. Mr. Stone said that the inspector, in granting the amended s.17 certificate had specifically considered both minerals extraction and landfill, and had rejected them for the reasons given in his report, the principal one of which was concern over access over Abbots Road.

In addition it was necessary to consider the existing use value, which Mrs Mawby had calculated at £17,000. Mr. Stone said that the later sale of the claimants' retained land at a figure of £5,000 per acre supported that valuation.

As to the claim, the acquiring authority accepted that, based upon the premise that planning permission existed at the appropriate date for the construction of the road, it was proper for any value attributable to that to be considered in the valuation, subject to the Pointe Gourde principle. However, that exercise must be approached on the basis that it was a genuine highways project, and not as a cover for a commercial minerals extraction operation.

The claimants had cloaked their approach with a series of facts, but they must accept that their valuation was of a minerals operation and, fundamentally, there was no commitment to build the road in the facts they assumed. Mr. Nardecchia had asked if there was anything to stop a second contractor completing the road, but the question was: did the valuation genuinely assume that a highway would be constructed on the subject land? Clearly, it did not.

In a proper approach to the valuation, the cost of constructing the road could not be ignored. If it was taken into account, a substantial negative value would result, which was precisely the point that had been made by Mrs Mawby.

A minerals operation, Mr. Stone explained, was fundamentally different from a road construction scheme. Firstly, looking at the nature of the development and the operations required, a road builder would use explosives to break up the underlying sandstone so that it could be loaded onto lorries, removed from the site and disposed of, and that would take no more than a year. A minerals operator, who would be seeking to extract the highest value from the stone would take considerable care in its removal so that as much as possible could be dressed and sold as building stone. This would not involve explosives and would take, depending upon which expert's evidence was relied upon, between 8 and 25 years. A minerals operation would be a commercial enterprise whereas the roadbuilding scheme was not.

If the local planning authority's enforcement officer were to ask questions, the minerals operator would not be able to truthfully answer that a road was being built.

The claimants' line in its arguments was not to value upon the basis of an assumed road permission, but to value on the basis of an activity which, it was submitted, was not authorised by that permission. The permission was for Stage IV A of the Avon Ring Road, not for a short section of 204 metres of road which did not go anywhere. The construction of that short section on its own would not be a part of the ring road and the real question was, therefore, could planning permission for a short length of road, in a cutting, with no connection to a public highway at either end, be assumed.

The hypothetical purchaser would undoubtedly recognise problems. The possible effects of the Willsbridge fault on stone quality towards the southern end of the land; possible artesian conditions and difficulties with excess water disposal; unsuitability of Abbots Road access and potential problems with access onto the site; potential competition from Conygar quarry and, finally, the possibility of problems with the planners if they discovered that there was no intention to complete the road. It must therefore be logically concluded that a minerals operator would not bid for the land in the real world.

Mr. Stone said that the difficulties relating to hydrology and potential flooding of the workings was a much more serious problem than the claimants made out. The experts had agreed that dry conditions were a pre-requisite for minerals extraction. No evidence had been produced to suggest that there were depressions within the claimants' retained land that could be considered suitable to act as a sump, and one would therefore need to be constructed. Planning permission for that would be required (as an engineering operation under s.55 of the Town and Country Planning Act 1991) as it would not be permitted as an agricultural operation under Part 6 of the General Development Order 1988. Bearing in mind the specific refusal of planning permission for minerals extraction following the s.18 appeal, Mr. Stone said that a hostile planning authority would be most likely to resist any such application. The suggestion by the claimants that the water pumped from the workings could be used to irrigate the retained agricultural land was a nonsense, as the water would only be available in wet periods when it was not required, and would not be available when it was needed.

A prospective purchaser would have serious concerns about potential demand. Pennant sandstone was not special and the market would probably be limited. He would know that Conygar existed as competition, but would be aware of its problems and the fact that it was not thriving.

The difficulties both in respect of the narrow and winding Abbots Road and improving the access into the site, and the potential planning nightmare that could ensue, would be a very considerable deterrent to a prospective minerals operator. It was submitted that planning permission would be required under s.336 of the Town and Country Planning Act 1990 which related to the formation and layout of a means of access to a public highway. It could not be considered to be permitted development under the 1988 GDO as the access was onto a classified road (Article 3(5)). The existing field gate to the west of the subject land, which the claimants contended was available and could be used, was not suitable for access and egress by HGV's and a haul road would also need to be formed – again requiring planning permission as it was not an agricultural use.

As to the new accommodation access immediately to the east of the land, and which had been raised by Mr. Nardecchia for the first time in his opening submissions, Mr. Stone said that permission for it did not form a part of the original permission, and it was the Side Roads Orders that authorised access. Planning permission for that access could not, therefore be assumed under s.14 of the 1961 Act. Whether or not it could be assumed under s.15(1) turned upon whether it was such as would permit development in accordance with the proposals of the acquiring authority and it was submitted that it was not. The accommodation access was not part of Stage IV A, but was to mitigate severance caused by the scheme. It could certainly not be assumed in the no-scheme world as there would have been no severance to Kynaston and Gough's land, nor to the claimants' land.

The claimants' arguments to the effect that the construction of the temporary diversion formed a permanent access were unsustainable. The temporary land-bridge was just that, and it was removed as soon as the new over-bridge had been completed. The haul roads that were constructed on each side of the land-bridge were to facilitate, temporarily, the crossing of it, and not access onto Abbots Road. The restricted and very temporary use of Abbots Road in connection with the surfacing of the diversion could not be taken as a precedent for formation of a permanent access. Fundamentally, Mr. Stone said, there could be no sustainable assumption that the planning permission for Stage IV A included permission for a permanent access from Abbots Road.

The arguments relating to the potential to obtain planning permission for infill and restoration of the land were a vivid illustration of the fact that there was never any intention in the claimants' hypothetical scenario that the road would ever be built. Mr. Stone said that Mr. Salmon's valuation had produced bullish figures that did not take into account the pitfalls and disadvantages that had been outlined in the acquiring authority's case.

Mr. Stone said that part of the acquiring authority's case relied upon s.5 rule (3) of the 1961 Act – the special suitability or adaptability of the land. He referred to Mr. Phillips' evidence relating to the route selection process, from which any reasonable conclusion must be that the chosen route had the best combination of qualities for Stage IV A. The decision was not finely balanced, as had been suggested by the claimants, and it had not been subsequently challenged at the inquiry.

In Laing Homes Ltd v Eastleigh Borough Council (1978) 250 EG, a Lands Tribunal decision relating the compulsory acquisition of land for the construction of a spine road through a housing development, where rule (3) had been considered in the context of whether the land held the key to its completion, Mr. Stone referred to the Tribunals findings at p640 where Mr. E C Strathon FRICS said:

"In so far as the reference land attracts a special value as the key to the completion of the spine road, I am persuaded by Mr. Harman's submission that the effect of rule (3) in section 5 of the 1961 Act would be to exclude such special value. On the evidence, the line of the spine road was considered to be the acceptable line for the purpose and I am satisfied that geographically it is the best line for its purpose. Within the terms of rule (3), following the judgments in Lambe, the reference land possesses the quality of special suitability for the purpose of building the spine road. The market for such a purpose would be limited; it is clear that Eastleigh would be in the market and Mill Lodge, as the owner of the land, to carry out the construction works on behalf of Eastleigh to enable Eastleigh to adopt the road.

It follows that on this issue I accept the submission of Mr. Harman that the special suitability of the reference land for the purpose of building the spine road shall not be taken into account because for that purpose there is no market apart from the requirements of Eastleigh or the special needs of Mill Lodge on behalf of Eastleigh"

Mr. Stone said the circumstances in this case were similar, and thus no account should be taken of any special suitability.

Mr. Nardecchia said that he had outlined the claimants' case comprehensively in his opening submissions, but there were a number of matters that needed to be clarified following the evidence. Firstly, in respect of Mr. Stone's submissions on rule (3), he said Laing Homes was not good law because it conflicted with the Court of Appeal decision in Batchelor v Kent County Council (1989) 59 P&CR 357. Special suitability is not the same as most suitable and therefore the Tribunal was wrong to say (obiter) that rule (3) applied in Laing Homes because the best line for the spine road was on the reference land. In Batchelor there was more than one option for the siting of a roundabout junction which was required as an access to the development site and this prevented rule (3) from applying, even though the reference land clearly provided the most suitable location.

In the instant case, it was apparent from Mr. Phillips' evidence that there were at least 2 options for the line of the ring road (the purple and orange routes) and possibly more. The purple route, that did not include the subject land, was originally the preferred and protected route, but in the end the County Council opted for the orange route. Whilst it may have been the best, it was not the only option and therefore the requirement under rule (3) was not satisfied. Mr. Nardecchia said that 'best line' is not enough to satisfy the rule according to Batchelor. In that case it was held, in allowing the appeal, that the findings of the Tribunal that there were other possible accesses to the land excluded the "special suitability" rule in rule (3). The relevant extract, at p361, read:

"Rule 3

Rule (3) of section 5 of the Act of 1961 was introduced into the statute book in 1919 (see Acquisition of Land Act 1919 s.2) and was, and is, thought to have been intended to reverse the impact of the decision in IRC v Clay. The rule provides that, in assessing compensation:

The special suitability or adaptability of the land for any purpose shall not be taken into account if that purpose is a purpose to which it could be applied only in pursuance of statutory powers, or for which there is no market apart from the special needs of a particular purchaser or the requirements of any authority possessing compulsory purchase powers.

There are two (maybe three) limbs to the rule. The perception of limbs by the acquiring authority was first made in this court. No objection was made to the perception by the claimant.

Howsoever the rule is divided, one or other of the limbs can be motivated only if the land has a "special suitability or adaptability". This involves a consideration both of ordinary English words and of fact (as to the latter see Brandrent Investment Developments Ltd v British Gas Corporation [1979] 252 EG 267 at p273). A special suitability can be found where land has a positional advantage for the purpose in hand (see Raja Vyricherla Narayana Gajapatiraju v The Revenue Divisional Officer Vizagapatam.) What then is "special"? This ordinary word in its adjectival sense is given the following meaning in the Oxford English Dictionary:

Of such a kind as to exceed or excel in some way that which is usual or common; exceptional in character, quality or degree.

The Tribunal found (1988) 56 P&CR 320 at p 323 that:

the most suitable access to the land to the south is that which has been formed on the order land.

The Tribunal further found it "was unable to find that the order land would have been the only access to the land to the south". There were other options. The findings of the Tribunal in my judgment are decisive against a "special suitability". The order land may have been the most suitable land for access to the south but it was not specially suitable for that purpose. Most suitable does not correspond with specially suitable.

In my judgment the appeal by reference to rule (3) fails in that the prefatory words of the rule are not satisfied upon the facts as found".

Mr. Nardecchia invited me to decide whether, in the instant case, the rule had been satisfied.

Furthermore, Mr. Nardecchia submitted that rule (3) could not apply because the purpose was not one to which the land could be applied only in pursuit of statutory powers. Roads can be constructed by private individuals as well as statutory authorities provided planning permission exists. Whilst this was not a point being argued by Mr. Stone, it was another reason why the rule (3) argument should fail.

The words in rule (3) relating to the special needs of a particular purchaser were repealed with effect from 25 September 1991, but under the transitional arrangements in the Town and Country Planning Act 1990, were still applicable in this case. In any event, Mr. Nardecchia said, nothing turned on that particular point. The acquiring authority needed to prove firstly that that the land had special suitability or adaptability, secondly that that purpose was one to which it could be applied only in pursuance of statutory powers or, thirdly, that there was no market apart from the special needs of a particular purchaser or of the authority's requirements. In his submissions, he said that has not been shown to be the case.

Mr. Nardecchia said that the reference to open market value needed to be understood in the context of Inland Revenue Commissioners v Clay [1914] 3 KB 466, and upon that basis there could be no doubt that minerals operators would have realised the potentialities of the land and bid accordingly. Mr. Ferguson, he said, had accepted in cross-examination that the problems of the site were not so costly as to deter bidders. Mr. Salmon, in preparing his valuation of what such an operator would bid was an experienced minerals surveyor who had assessed the quality of the minerals as good or reasonably good, albeit with variations. Nothing in the Exploration Associates report contradicted this. Mr. Salmon had made generous allowances for any variations in the quality of the materials and, as to the need for retaining walls, it should be noted that only about 30 metres out of 204 metres needed this strengthening. The contractor who undertook the scheme destroyed the rock by using explosives, and therefore the evidence as to what was done with it after blasting was not probitive of its pre-existing quality.

On the most contentious question of access, Mr. Nardecchia said that the price a hypothetical purchaser would be prepared to bid did not fall to be reduced for access difficulties. Despite the acquiring authority's efforts to deny it, it was evident that the contractor gained access from Abbots Road for the purposes of carrying out the excavation and the road construction. Mr. Slane's evidence was quite conclusive that access was taken "quite properly" as he had said, from the diversion road. Although that was only for the period of the construction there was nothing in the planning permission that restricted the duration. Whilst the contractor who built the road may have entered into an agreement not to use Abbots Road as a site access, a minerals purchaser would not have agreed to such a clause as it would have been detrimental to his commercial enterprise unless there had been a suitable alternative.

The concrete haul road that had been constructed to cross the diversion also facilitated access to the land to the north and south, and these factors were all, in the claimants' submission, conclusive proof that access from the subject land formed part of the acquiring authority's scheme or proposals and/or were part of the development for which the land was acquired.

Therefore, whether under s.14(2), s.15(1) or s.15(5) of the 1961 Act (or any combination of them) the valuation of the claim had to proceed on the basis that such access existed. Furthermore, whether or not it was part of the plan actually approved when planning permission was granted, there could be no doubt that the creation of the accommodation access east of the cutting was part of the proposals of the acquiring authority (s.15(1)) and/or part of the development for which the claimants' land was acquired (s.15(5)). Therefore as the accommodation access was on the claimants' land and unaffected by any user restriction, there was no basis for suggesting that the hypothetical purchaser could not use it for his required purposes.

Even if none of these accesses were available to the purchaser, he could still have used the original field gate to the west of the subject land. Although it was accepted that it was sub-standard, it was capable of use. In the context of the planning permission to be assumed in the no-scheme world, it would not be rational to conclude that the local planning authority would refuse to permit improvements to make easier and safer something that had already been permitted. The inspector at the s.18 inquiry, to whose report Mr. Slane had referred, was dealing with a fundamentally different situation. He was looking at a situation where no planning permission existed, and his conclusions were therefore of no relevance in this case where planning permission for the road did exist, and in connection with which, minerals extraction was required. In this case, it must be assumed that if planning permission was granted, the authority would want the development to happen and it could not then be supposed that it would forbid necessary and desirable improvements.

Regarding drainage, and the possibility of flooding, Mr. Nardecchia said that the problem had been greatly exaggerated by the acquiring authority. The photographs produced in evidence did not show a problem of any particular scale or complexity, and it was Mr. Salmon's view that a minerals operator would expect to have to carry out some drainage works. That could be done at little cost by pumping onto adjacent land and if there were no natural depression in the land, a sump could be constructed which would not need planning permission as it would not constitute development. Section 24 of the Water Resources Act 1963 indicated that an abstraction licence was not required. Section 72 of that Act stated that a licence was required to discharge trade effluent or other noxious or polluting matter by well, borehole or pipe. A sump was none of these things, and if the water were contaminated a settlement pit would eradicate the problem. Any works that were required to deal with surplus water would not be of sufficient impact to materially affect the hypothetical purchaser's bid.

The risk of an approach from the local planning authority's enforcement officer, as propounded by the acquiring authority was, Mr. Nardecchia said, a non-starter. Any concerns that may be expressed to the minerals operator could effectively be countered by the statement that he would not be constructing the road himself, but was preparing the land in readiness for that second stage of the process. On that basis enforcement action could not be taken.

The landfill question was covered under s.14(3) of the 1961 Act, it allowing the claimants to have regard to the hope value of obtaining such a permission in due course. The situation would only arise in the no-scheme world if a road builder could not be found. The likelihood of obtaining permission must be high, Mr. Nardecchia said, because the relevant planning policies show that the local planning authority would wish to see the land restored, and infilling it was the most logical answer.

Finally, in connection with the valuations, Mr. Nardecchia said that Mr. Ferguson had misinterpreted the evidence of value taken from the High Court judgment on Conygar quarry. His comparables regarding royalty rates derived from the VO's rating records were not reliable, and in any event did not support a figure of £4 per tonne. Swellwold and Oathill quarries were higher, and Bixhead was so low as to be obviously not comparable. Without knowing the circumstances of Swellwold and Oathill it was not possible to assess the true comparability with the reference land. However, Mr. Salmon, who knew Swellwold and was actually instructed to sell it in 1991 had applied £7 per tonne if using the royalty method, balancing that against Cotswold hill quarry at £8.77 per tonne. Mr. Ferguson's hearsay evidence relating to the possibility of Cotswold Hill not being arms-length should be disregarded as it was not backed up by any documents.

As Mr. Salmon had said, the royalty method or basis of valuation was not helpful unless supported by sufficient examples. That is why he had opted for a notional royalty approach based upon an assessment of the likely future profitability and gross margin. He had then checked his figures by comparison with letting values taken as a percentage of gross receipts, and which bore out his primary figure.

Mr. Ferguson's suggestion of a lifespan for the quarry of 25 years was based upon a very small annual output. Bearing in mind Conygar was the only local competition, and that was known to be unreliable and suffering from problems, it was reasonable to assume, as Mr. Salmon had done, that 6,400 tonnes annually was an appropriate figure.

DECISION

The claimants argued that because planning permission existed for the construction of a road, and as a part of that development it was necessary to create a cutting and extract minerals, a hypothetical purchaser could assume he had the right to carry out a minerals operation, extract the profits from that, and then leave the land for someone else to finish the job. The fact that that someone else, as was accepted, would not exist because in the no-scheme world, there would be no need, and therefore no market, for a 204 metre section of road that did not go anywhere, was considered irrelevant.

The issues, as set out in para 6 of this decision, are whether the actual or deemed planning permissions would permit the extraction of minerals as a discrete operation, without completion of the road, and, if so, whether or not in calculating compensation, the costs of construction the road have be taken into account.

If the extraction of minerals, as an operation for commercial gain, was permitted within the permission for the road, all the claimants arguments and evidence fall to be considered. If that operation was not permitted and would require a separate permission, then the only matter for my determination is the value of the land for its existing use, or for a road in accordance with the s.17 certificate, as it was quite clear from the s.18 appeal decision that permission for minerals extraction would not be forthcoming.

There was an actual planning permission in existence at the relevant date. The development for which the permission existed was a road – Stage IV A of the Avon Ring Road, the 2.8 km section of dual carriageway running between the A431 in the north to the A4 in the south. That road was to cross the claimants' land, the compulsory acquisition of which was required for a 204 metre section – less than 10 per cent of the total.

Planning permission was clearly for a road and not for the extraction of minerals. If permission was required for the extraction of minerals, because that activity was one of substance and not merely ancillary to the other activity (the construction of the road) (see West Bowers to which I shall refer in a moment), then under s.15(1) of the 1961 Act it is to be assumed that such permission would be given.

However, the key point here is whether in his legal arguments, Mr Nardecchia was right to rely upon West Bowers. I think not. Whether planning permission was required for the extraction of minerals depends upon whether the excavation of the stone should be seen as a separate activity. This is a question of fact and degree (see Nourse LJ at p.374) – that passage having been quoted by Mr Nardecchia in opening. See also Sir John Donaldson M.R. at p.378.

Looking at the nature of the operations in the instant case – the construction of a road – 'cut and fill' is the essence of what is being done. It was clear from the evidence that only a small percentage of the extracted materials were removed from the site of the scheme. The majority were used to provide the base for the road and a noise attenuation bund elsewhere on the scheme. Most cut and fill operations for roadbuilding "could not possibly be described as a mining operation" (Donaldson M.R. at p.378). The fact that only a small proportion of the extracted materials was not used in connection with the construction of the road means, in my judgment, that this was not, and could not have been, a mining or commercial minerals operation. Not being such an operation means that no planning permission was required, or indeed existed, for that purpose.

The contrast with West Bowers is that, in that case, a very substantial amount of gravel was to be extracted and sold – it was not a cut and fill operation. There were "two activities, each of substance. The extraction of so much gravel will not merely be ancillary to the carrying out of the engineering operations" (Nourse LJ at p.374). In my judgment, the construction of the cutting, and the use of the materials extracted elsewhere on the scheme was all part of the overall operation.

The claimants' legal arguments suggested that the extraction of the minerals on the subject land amounted to development within the meaning of s.55(1) of the Town and Country Planning Act 1990, and that the s.17 certificate required it to be assumed permission existed for "any development for which the land is being acquired". Thus, the land had to be valued on the basis that permission existed to extract the minerals for commercial gain. Mr Nardecchia said that the development (in terms of mineral extraction) was unaffected by the fact that it was carried out as part of or preliminary to the construction of a length of road. For the reasons I have given, I consider those arguments to be unsustainable.

What was permitted was the construction of the road, and mineral extraction as a commercial and discrete operation (other than in connection with the building of the road) was not permitted. Moreover, it would not have been permitted in absence of the proposal to acquire – this being, as I have said, clear from the s.18 appeal decision. Furthermore, extraction of the stone other than for the purposes of roadbuilding would have been unlawful, and so any increase in value that might arise from such use must be left out of account – see s.5 rule (4) of the 1961 Act. Whilst there is a dichotomy under s.55 of the 1990 Act between a change of use and operational development, "use" in rule (4) (which dates from the Acquisition of Land Act 1919, long before development was defined in the Town and Country Planning Act 1947), clearly embraces operations. The purpose of the provision in rule (4) is to prevent the claimant getting an enhanced value for his land out of something that is unlawful.

Following the substantive hearing, I asked the parties to consider the authority in Copeland Borough Council v Secretary of State for the Environment (1976) 31 P&CR 403 which had not been referred to in evidence or in legal submissions. Both parties were of the view that that was not an authority directly on the point and the claimant reiterated that West Bowers was the appropriate case. However, the acquiring authority said that Copeland was in line with its thinking that the character of the development derives from the whole development, and to construct only a small part would result in something different in character from Stage IV A of the Avon Ring Road. It reiterated that that the claimants' valuation scenario related to an entirely different permission – namely a minerals permission, and a minerals operation was clearly different from a highway permission, and thus not permitted by it.

I agree. The claimant said that the position was that two permissions existed or must be assumed to have existed, and a developer with two permissions would be entitled to implement one and not the other. However, I have determined that there was only one permission and, in my judgment, Copeland adds weight to that decision and to the conclusion that West Bowers does not assist.

The point in Copeland was, in the circumstances of that case, that where there was to be new development on land not previously developed, subject to any special provisions in the planning permission itself, the operation was to be treated as a single one. It is a matter of construction of the planning permission, as I have explained, and here, like the single house in Copeland, there was a permission that was for a single development – a road. It is not properly to be construed as permitting any of the component operations except as a part of the overall operation of road construction.

Had the circumstances in this case been the same as those that applied in West Bowers, and under s.15(1) of the 1961 Act separate permission for mineral extraction had been granted then, as the parties have agreed, if those minerals had a value (as part of the value of the land) and that value was not outweighed by the costs of winning and working, it could be taken into account for compensation purposes. However, I have not found that to be the case and therefore the evidence and arguments in relation to the value of the minerals together with the other issues such as access, the application of rule (3) of the 1961 Act, potential for landfill or matters of enforcement do not require consideration. Furthermore, the question of whether or not the cost of construction of the road needs to be taken into account is not relevant, although I return to these points later in connection with the application of Rule 50(4) of the Lands Tribunal Rules 1996.

Having dismissed the claimants planning arguments, I turn to the question of what value applied to the subject land on the basis that one permission existed, for a road. It has already been agreed between the parties that the alternative use for sports pitches had no value due to the cost of complying with conditions attached to the s.17 consent.

The parties had, prior to the substantive hearing, agreed the value of the land for agricultural purposes at £17,000, and that was the figure Mrs Mawby suggested as appropriate, based upon horse-grazing, or pony paddock values at £5,000 per acre. This was supported, she said, by the sale of the claimants' retained land, at auction, in 1999. That result reflected any hope value there might have been for use as serviced paddocks. Mr. Nardecchia said that there was some question over whether the 'agreement' at £17,000 was based upon pony-paddock values or whether it was a pure agricultural value as the agents' letters of confirmation were unspecific. Mr. Salmon had estimated horse-grazing values at around £8,000 per acre (based upon £10,000 less cost of fencing and services) making an after-use value for the land of £27,200. Mrs Mawby pointed out that he had produced no evidence to support his figure.

I prefer Mrs Mawby's evidence, and although it was a considerable number of years later, the sale of a much larger parcel (29 acres) of adjacent land at £5,000 per acre lends support, in my view, to a similar figure for a smaller parcel being appropriate in 1991. I therefore determine that the acquiring authority shall pay compensation for the compulsory acquisition of the subject land in the sum of £17,000.

This decision determines the substantive issues in this case. However, under rule 50(4) of the Lands Tribunal Rules 1996, as amended, I am required, where an amount awarded or a value determined was dependent upon a decision on a question of law which was in dispute in the proceedings, to ascertain and state any alternative amount or value that would have been determined if I had come to a different decision on a point of law.

If I had accepted Mr. Nardecchia's arguments relating to the legal basis of valuation, and the assumptions to be made under the 1961 Act, on the basis that a commercial operation was permitted, and that no additional permission was required in respect of access, then, in considering the valuation evidence, the question as to whether or not the cost of completing the road needed to be taken into account has to be resolved – and that is another point of law. I deal with that aspect first.

In my judgment, the local planning authority could not force the completion of the road. S.94 of the Town and Country Planning Act 1990 gives the Local Planning Authority powers to serve a completion notice, in certain circumstances, where it is of the opinion that the development will not be completed within a reasonable period. That notice will simply state that the planning permission shall cease to have effect at the expiration of a defined period (not less than twelve months after the notice takes effect). That section does not, in my view, apply in this case as, under s.94(1)(a) there must have been a condition or conditions attached to the permission relating to time limits. It has been agreed that, in respect of the relevant permission (for the road), no conditions applied. Furthermore, neither s94(1)(b) or s.94(1)(c) apply.

Even if that section did apply, once the minerals operator had completed the only part of the development which in his view would be likely to achieve a profit, the fact that the permission would cease to have effect would be of little concern. As it does not apply, in my view, his concerns regarding the implications of non-completion would be even less.

The claimants' arguments as to how a hypothetical purchaser would look at the potentialities of the site therefore bear much more weight. He would, as Mr. Nardecchia suggested, assess the value of the land purely on the basis of the value as a commercial minerals operation and would also consider the possibility of being able to achieve additional profit if a subsequent application for infill were successful. He would be aware that, so long as there was sufficient value in the underlying minerals to achieve a profitable operation, the risks associated with not completing the road, either himself, or not being able to find a buyer who would do it, would not result in any material financial penalty.

So, having concluded as a matter of law that the acquiring authority's arguments on the cost of the road cannot be sustained, I now look at the valuations of Mr. Salmon (at £400,000 and £200,000 as an alternative) and Mr. Ferguson's valuations which ranged between £16,500 and £30,000 but were, he said, only produced on the basis that the acquiring authority's arguments, which I have dealt with above, failed.

Mr. Salmon produced two valuations that each comprised three elements: firstly the capital value of the mineral deposit, secondly the potential for disposal of waste, and thirdly the value of the land after restoration. The third element has been determined in the sum of £17,000, but that figure would only apply if the land could be infilled with waste, and levelled off to its original contours.

The first valuation was based upon assumptions that had been made by him in relation to the anticipated depth of the cutting, and what was considered could be available, in total, to a minerals operator. If the argument is accepted that a minerals operator could extract the minerals and dispose of them for commercial gain in the no-scheme world, and, as the claimants said, the site would be left ready for the second stage of the operation – the road construction, it is in my view reasonable to assume that the amount of minerals that the valuation was based upon should be the amount that was actually extracted when the road was built. To accept figures based upon what a minerals operator would calculate could be available for a straightforward commercial venture, without taking into account the fact that the planning permission was for a road would, in my judgment, be an acceptance that the two operations – commercial minerals extraction and extraction and removal for the provision of a cutting were the same thing.

It follows therefore, that it is Mr. Salmon's second valuation at £200,000, prepared on the basis of the acquiring authority's actual extraction figures, that I consider in this decision. He had based his estimate of the capital value of the minerals upon the anticipated quantities available for extraction, the predicted quality of the materials, the value per tonne from research into stone prices in 1991 and the likely demand for Pennant sandstone and hardcore. He then estimated the cost of winning and working, and applied a notional rent or royalty to arrive at the value.

He said there were two methods of assessing the rent that an operator would pay – rent based upon a percentage of turnover (which he had calculated at 15 per cent), or a royalty based upon 50 per cent of the gross margin. As a check he had looked at both methods and they came out at similar figures. He gave examples of quarries with which he had been involved to support the figures he had applied, although, as became apparent in cross-examination the market for quarries is extremely volatile, and there are wide variations making accurate assessments of value somewhat difficult. It was put to Mr. Salmon that his figures were somewhat bullish, and whilst I am satisfied that from his knowledge and experience, he had undertaken a comprehensive exercise to establish values, I am inclined to agree that they appeared to be at the higher end of the scale.

Having said that, I think he made a sufficient allowance for the variable quality of the stone, and indeed the experts agreed that there was not much between them in terms of likely quantities of the best quality stone – that suitable for dressing and sale as building stone. Where Mr. Salmon failed to make allowances was for the possibility of flooding problems, and the potential costs of dealing with them; the need to provide a haul road across the claimants' retained land if the existing field gate access to the west were to be utilised, and the likelihood that improvements to the access gate would be required. This was only dealt with in his supplementary report and in evidence, but his conclusions that none of these were likely to have a material effect were, in my judgment, unrealistic.

Mr. Ferguson, in his valuation based upon a building stone quarry at £30,000 (which I accept was only included for the sake of completeness), had anticipated that demand would be much less than Mr. Salmon had thought, and that it would therefore take 25 years to complete extraction at much reduced annual outputs. In his view Conygar would be able to provide sufficient quantities although it became apparent during the hearing that there were substantial problems with that quarry, and its supply was unreliable. Mr. Ferguson had also based his royalty figures upon rating returns which, he accepted, were not a reliable source for the accurate assessment of rental values. He applied royalty figures for the building stone at £4 per tonne, whereas Mr. Salmon's calculations were based upon a percentage of the overall output and are not, therefore, easily compared. However, his figure was likely to be nearer that which was said to have applied on Cotswold Hill Quarry at £8.77 per tonne, but there was some question over whether that rent was agreed on an arms length basis.

The landfill potential was thought by Mr. Ferguson to have a nil value, and he had not therefore considered the question of after-use value. Mr. Salmon had valued the potential for landfill at £14,865, on a deferred basis. Mr. Salmon had considered there was a high likelihood that planning permission for that would have been forthcoming. I am not as confident as he was on this aspect, and in any event, the alternative valuation that I am required to provide is on the basis that planning permission existed to allow a commercial minerals operation as part of the road scheme. I am not required to assume a further planning permission, and therefore ignore any hope value that might or might not have applied. The same must, logically, go for the after use value

This means that I am left with Mr. Salmon's analysis of the capital value of the minerals at £172,380 (on his revised assessment based upon the actual quantities extracted), and Mr. Ferguson's figure of £30,000.

On balance from the evidence, I prefer Mr. Salmon's analysis and calculations in this hypothetical scenario. However, I do think that, overall, his figures appeared somewhat optimistic, and he had not made any allowances for the potential problems that have been referred to. Those problems (or risk factors), and particularly those relating to access, were manifold, and I am sure that a potential purchaser, if not completely dissuaded from proceeding, would discount his bid to very great extent. Doing the best that I can, and also taking account of the fact that, despite its problems, there was another source for Pennant sandstone at Conygar and the potential local demand for that type of stone was not proven (the 'circular argument' to which Mr. Salmon referred), I think a 50 per cent allowance (from the £172,380) should be made for those factors.

Therefore, in accordance with the requirement under Rule 50(4) of the Lands Tribunal Rules I determine that the value of the subject would have been, had I determined the legal argument in the claimants' favour, £86,190 – say £86,000.

In determining this alternative figure, I have had to accept a multitude of assumptions as set out in the claimants' case, and I agree with what Mr Slane said in his evidence to the effect that those assumptions were "a step too far". In my judgment, in the real world, those assumptions which led to an opinion that a minerals extraction operation was permitted and financially viable are unsustainable.

As I indicated above, this alternative valuation on the basis of Rule 50(4) also turns on a point of law – that is that the hypothetical purchaser would not need to take into account the cost of completing the road. If I am wrong in my decision on that point, and the purchaser were to have to take it into account, the alternative is clear. The value would revert to the existing use value (£17,000) as the cost of completing the road far outweighs any potential value in the land for a minerals operation.

One final point. Logic and common sense determine that the claimants' case should fail. The acquiring authority's evidence all pointed, unquestionably in my view, to that conclusion. I have some considerable sympathy with the claimants who have been in receipt of legal and professional advice throughout this reference. Their case weighed heavily on assumption upon assumption that I consider to be manifestly unsustainable, and it appears to me that, notwithstanding the planning arguments, the realities of the situation have been substantially ignored.

As I have said, this decision so far concludes my determination of the substantive issues in this case, and is final. It will take effect as a decision when the question of costs has been decided and at that point, but not before, the provisions relating to the right of appeal in section 3(4) of the Lands Tribunal Act 1949 and Part 52 of the Civil Procedure Rules will come into operation. The parties are invited to make submissions as to the costs of this reference and a letter accompanying this decision sets out the procedure for submissions in writing.

DATED: 27 September 2001

(Signed) P R Francis FRICS

ADDENDUM ON COSTS

I have received submissions on costs from the parties. The claimants sought their costs up to the date of the sealed offer, interest on the compensation awarded from the date of entry (14 October 1991) and surveyors fees in accordance with Ryde's Scale. In their submission, although the compensation awarded was less than the sealed offer, there were special reasons under s.4(1) of the 1961 Act why the claimants should not have to bear their own costs and/or pay the costs incurred by the Council after the offer was made.

Firstly, the claimants said, the reason they had failed to obtain an award in excess of the sealed offer was solely because of one point of law. However, the decision recognised that were it not for that one point, the claimants would have obtained £86,000, far in excess of the sealed offer. The Council had failed to make good many of the points it had relied upon at the hearing, such as the arguments over benefit and burden, access problems and drainage. Argument on those points involved substantial evidence and additional witnesses which took up at least half the hearing time, but despite all this, the claimants succeeded in showing that none of them had the effect of reducing the claim to a sum equal to, or below the Councils offer. In the circumstances therefore it was appropriate for the Council to pay half the claimants costs of the reference.

Secondly, the point of law on which the Council succeeded. The claimants submitted that their case was based principally on West Bowers and Myers, and they had sought to deal with that point by way of a preliminary issue, a proper procedure designed to save costs. The claimants' skeleton argument for the preliminary hearing said the claim should be valued on the basis that the land taken contained minerals (as part of the land) and that planning permission existed which authorised the extraction and removal of those minerals, even though the scheme is to be disregarded.

Following the citing of the authorities, counsel for the acquiring authority had conceded, orhad appeared to concede, that they provided a valid basis for the minerals based claim. The President's note of the hearing recorded that counsel acknowledged that if the minerals had a value that exceeded the cost of winning and working them, such value could be taken into account in valuing the claimant's interest.

Subsequently, the Council indicated that it still intended to rely upon the point about there being no extant planning permission for minerals extraction, which, the claimants submit, was the point the preliminary hearing was intended to resolve. If the Council had made it clear at the preliminary hearing that that it challenged the relevance or applicability of the authorities that had been referred to, then the President could not conceivably have concluded that there was no dispute on any point of law.

The result was that the claimants had failed on a point of law which could, and should, have been resolved at the preliminary hearing. If the Council had put its full case on the point at the appropriate time, considerable additional costs could have been avoided and it would therefore be inequitable for the claimants to have to pay them. Special reasons therefore existed to justify the Council paying 50 per cent of the claimants' costs from the date of the sealed offer, and for the claimants not to have to pay any of the Council's own costs.

The acquiring authority, in its initial costs submissions, simply said that, as the sealed offer of 20 September 1993 (in the sum of £20,000 plus interest and costs) had not been beaten in the Tribunal's award, it should receive all of its costs from that date, and the claimants should be responsible for their own. In accordance with the provisions of s.4 of the 1961 Act, the Tribunal's discretion on costs was limited and there were considered to be no special reasons why the presumption in that section should be overturned.

In its response to the claimants' costs submissions, the acquiring authority said the reasons advanced do not amount to the necessary special reasons which would justify a costs award in their favour. The Tribunal had clearly set out the two issues that arose for determination (paras 6 and 168) and had resoundingly concluded that the planning permission that existed did not permit the extraction of minerals as a discrete operation, it following that the costs of the road construction did not need to be taken into account. The acquiring authority had therefore succeeded on both substantive issues, and the fact that the Tribunal was required under rule 50(4) of the Lands Tribunal Rules 1996 to set out an alternative valuation, should not prejudice that success.

In resisting costs, the claimants were effectively requesting the Tribunal to ignore its findings on a point of law, and go on to consider the evidence of the cost of building the road. That would be unrealistic, because in this case all of the valuation issues rested on the outcome of the legal issue in dispute. Although, as was claimed, the claimants may have failed on only one point of law, that point of law was the very issue which went to the heart of the determination.

The preliminary issue that the claimants sought to have determined at a preliminary hearing was "Whether in addition to the value of the subject land the claimants are entitled to the value of minerals removed from the land during the construction of the road". It reflected the denial of this claimed entitlement in para 1 of the Defence. In the event, the preliminary hearing into this issue on 10 February 2000 was not proceeded with, both parties agreeing that they should each be allowed to amend their pleadings instead. Even after the opportunity had been given for the pleadings to be put in order, the point on which the acquiring authority has been successful – that planning permission for the construction of the road did not permit the extraction of the minerals from the land other than for the purpose of constructing the road – was not spelled out.

In its Amended Defence of 2 March 2000, the acquiring authority averred at para 4(1) that the land enjoyed no planning permission for mineral extraction and that no activity in the nature of mineral extraction might be assumed. At that point, in my view, it would have been open to the claimants to make clear their contention that planning permission did exist for the extraction of minerals, and to apply for that question to be decided as a preliminary issue. It is in my view unfortunate that this was not done. If it had been, the issue would have been disposed of at a preliminary hearing, with a substantial saving of costs, and an earlier resolution of this long-standing dispute.

The claimants did have the opportunity after service of the Amended Defence to identify the issue, and to apply for it to be determined as a preliminary issue. They did not do so. It follows that, in my opinion, no special circumstances exist which would deter me from determining that costs should follow the event. I therefore determine that the claimants shall be responsible for their own costs, and shall pay those of the acquiring authority from 20 September 1993, such costs to be subject of a detailed assessment by the Registrar if not agreed.

Finally, for the sake of clarity, I confirm that the award shall attract interest at the statutory rate from the date of entry, and that surveyors' fees shall be based upon Ryde's scale.

DATED: 12 November 2001

(Signed) P R Francis FRICS

APPENDIX 1

J E SALMON

VALUATION CALCULATIONS

(FIGURES ROUNDED TO THE NEAREST TEN)

Stone Income
Area of land suitable for extraction	10,570 m2
Depth of stone beneath overburden	6 m
Volume of stone	63,420 m3
Tonnage (x2.2 tonnes per m3)	139,524 tonnes

Saleable stone (139,524 x 50%)	69,762 tonnes

Saleable stone waste (139,524 x 50%)	69,762 tonnes
Stone overburden (10,570 m2 x 3mdeep x 2.2)	+69,762 tonnes
All saleable stone "waste"	139,524 tonnes

Of the 69,762 tonnes saleable stone:
60% is suitable for walling stone	41,860 tonnes
40% is suitable for "cropping" 27,900 tonnes of which waste is 20% -5,580 tonnes
Saleable rough dressed (i.e. cropped) stone	22,320 tonnes

Total saleable stone (41,860 + 22,320)	64,180 tonnes
Total saleable stone waste (139,524 + 5,580)	145,100 tonnes

Annual output over 10 years
Walling stone	4,190 tonnes
Rough dressed (cropped) stone	2,230 tonnes
Stone waste (bulk fill and hardcore material)	14,510 tonnes

Annual Income
Walling stone (4,190 tonnes x £37.50)	£157,125
Rough dressed stone (2,230 tonnes x £100)	£223,000
Stone waste (14,510 tonnes x £2.50)	£ 36,275
	£416,400

Production Costs
All stone (4,190 + 2,230 = 6,420 tonnes x £40)	£256,800
Stone waste (14,510 x £1.50)	£ 21,770
	£278,570

Annual Gross Margin (£416,400 - £278,570)	£137,830

50% share attributable to Owner's rent	£ 68,915

Landfill Income
Void space 10,579 m2 x 9 m deep	95,130 m3
Void space after doming	100,000 m3
Annual infill over a 5 year period	20,000 m3

Income (20,000 m3 x £2.25)	£45,000
Landfill Costs (20,000 m3 x 50 pence)	£10,000
Annual Gross Margin (£45,000 - £10,000)	£35,000
Share attributable to Owner's rent x 50%	£17,500

Afteruse Value
Afteruse land value as pony paddocks in excess of	£10,000 per acre
Deduct £2,000 per acre fencing and services =	£8,000 per acre
Afteruse land value £8,000 x 3,4 acres	£27,200

Land Value
The land value is the aggregated capital value of the income attributable to stone sales and landfill over the lives of those two operations using an appropriate "Years Purchase" (YP) based on a suitable risk rate. Added to it is the value of the restored land discounted to the valuation date.	The land value is the aggregated capital value of the income attributable to stone sales and landfill over the lives of those two operations using an appropriate "Years Purchase" (YP) based on a suitable risk rate. Added to it is the value of the restored land discounted to the valuation date.

Capital value of the mineral
Annual income	£ 68,915
Multiplier - YP 10 years @ 14%	x 5.2161
	£359,470

Capital value of the landfill
Annual income	£ 17,500
Multiplier - YP 5 years @ 16% 3.2743
Deferred 6 years @ 16% x 0.4104
	x 1.344
	£ 23,520

Afteruse Value
Capital value	£ 27,200
Deferred 11 years @ 7.5%	x 0.4513
	£ 12,280

Aggregated Value	£395,270

Rounded to	£400,000

APPENDIX 2

J E SALMON

VALUATION CALCULATIONS - AMENDED VOLUMES

(FIGURES ROUNDED TO THE NEAREST TEN)

Stone Income
Volume of stone	26,350 m3
Tonnage (x 2.2 tonnes per m3)	58,000 tonnes

Saleable stone (58,000 x 50%)	29,000 tonnes

Saleable stone waste (58,000 x 50%)	29,000 tonnes
Stone overburden	+50,000 tonnes
All saleable stone "waste"	79,000 tonnes

Of the 29,000 tonnes saleable stone:
60% is suitable for walling stone	17,400 tonnes
40% is suitable for "cropping" 11,600 tonnes of which waste is 20% -2,320 tonnes
Saleable rough dressed (i.e. cropped) stone	9,280 tonnes

Total saleable stone (17,400 + 9,280)	9,280 tonnes
Total saleable stone waste (79,000 + 2,320)	81,320 tonnes

Annual output over 10 years
Walling stone (17,400/8)	2,175 tonnes
Rough dressed (cropped) stone (9,280/8)	1,160 tonnes
Stone waste (81,320/8)	10,165 tonnes

Annual Income
Walling stone (2,175 tonnes x £37.50))	£81,560
Rough dressed stone (1,160 tonnes x £100)	£116,000
Stone waste (10,165 tonnes x £2.50)	£ 25,410
	£222,970

Production Costs
All stone (2,175 + 1,160 = 3,335 tonnes x £40)	£133,400
Stone waste (10,165 x £1.50)	£ 15,250
	£148,650

Annual Gross Margin (£222,970 - £148,650)	£ 74,320

50% share attributable to Owner's rent	£ 37,160

Landfill Income
Void space 26,350 m3 stone & 20,000 m3 overburden removed	46,350 m3
Void space after doming (add 10%)	50,990 m3
Annual infill over a 4 year period	12,750 m3

Income (12,750 m3 x £2.25)	£28,690
Landfill Costs (12,750 m3 x 50 pence)	£6,375
Annual Gross Margin (£28,690 - £6,375)	£22,315
Share attributable to Owner's rent x 50%	£11,160

Afteruse Value
Afteruse land value as pony paddocks in excess of	£10,000 per acre
Deduct £2,000 per acre fencing and services =	£8,000 per acre
Afteruse land value £8,000 x 3,4 acres	£27,200

Land Value
The land value is the aggregated capital value of the income to the landowner attributable to stone sales and landfill over the lives of those two operations using an appropriate "Years Purchase" (YP) based on a suitable risk rate. Added to it is the value of the restored land discounted to the valuation date.	The land value is the aggregated capital value of the income to the landowner attributable to stone sales and landfill over the lives of those two operations using an appropriate "Years Purchase" (YP) based on a suitable risk rate. Added to it is the value of the restored land discounted to the valuation date.

Capital value of the mineral
Annual income	£ 37,160
Multiplier - YP 8 years @ 14%	x 4.6389
	£172,380

Capital value of the landfill
Annual income	£ 11,160
Multiplier - YP 4 years @ 16% 2.7982
Deferred 5 years @ 16% x 0.4761
	x 1.332
	£ 14,865

Afteruse Value
Capital value	£ 27,200
Deferred 9 years @ 7.5%	x 0.5216
	£ 14,190

Aggregated Value	£201,435

Rounded to	£200,000

APPENDIX 3

LANDS TRIBUNAL ACT 1949

LAND AT HANNAM ABBOTS - J L FERGUSON'S VALUATION

1 BY COMPARISON WITH CONYGAR QUARRY

Analysis of Conygar Sale

Reserves of Pennant Sandstone 2 million tonnes 2 million tonnes

Consideration £500,000 £500,000

Cost per tonne in situ £0.25 per tonne £0.25 per tonne

Application to Plot 25

Reserves of Pennant Sandstone

Clean stone 8,000 tonnes

Overburden say 50% 25,000 tonnes

TOTAL 83,000 tonnes

Value @ £0.25 per tonne £20,750

Surplus Overburden @ say £0.20 £5,000

TOTAL VALUE £25,750

2. OPERATION AS A BULK FILL QUARRY

Reserves 108,000 Tonnes

Life of Project 2 years

Annual Output 36,000

Royalty £0.20 per tonne

Annual Income £7,200

Years Purchase @ 15% 2.2832

Capital Value £16,439

SAY £16,500

3. OPERATION AS A BUILDING STONE QUARRY

Reserves Building Stone 29,000 tonnes

Waste 29,000 tonnes

Overburden 50,000 tonnes

Life of Project 25 years

Annual Output Building Stone 1,160 tonnes

Waste 1,160 tonnes

Overburden 2,000 tonnes

Royalties Building Stone @ £4.00 per tonne £4,640

Waste @ £0.25 per tonne £290

Overburden @ £0.15 per tonne £300

TOTAL £5,230

Years Purchase 25 years @ 15% 5.7467

Capital Value £30,055

SAY £30,000

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You are here: BAILII >> Databases >> England and Wales Lands Tribunal >> Roberts & Anor v South Gloucestershire District Council [2001] EWLands ACQ_90_1993 (27 September 2001) URL: http://www.bailii.org/ew/cases/EWLands/2001/ACQ_90_1993.html Cite as: [2001] EWLands ACQ_90_1993

1	BY COMPARISON WITH CONYGAR QUARRY
	Analysis of Conygar Sale
	Reserves of Pennant Sandstone	2 million tonnes	2 million tonnes
	Consideration	£500,000	£500,000
	Cost per tonne in situ	£0.25 per tonne	£0.25 per tonne
	Application to Plot 25
	Reserves of Pennant Sandstone
	Clean stone		8,000 tonnes
	Overburden say 50%		25,000 tonnes
	TOTAL		83,000 tonnes
	Value @ £0.25 per tonne		£20,750
	Surplus Overburden @ say £0.20		£5,000
	TOTAL VALUE		£25,750
2.	OPERATION AS A BULK FILL QUARRY
	Reserves		108,000 Tonnes
	Life of Project		2 years
	Annual Output		36,000
	Royalty		£0.20 per tonne
	Annual Income		£7,200
	Years Purchase @ 15%		2.2832
	Capital Value		£16,439
		SAY	£16,500
3.	OPERATION AS A BUILDING STONE QUARRY
	Reserves	Building Stone	29,000 tonnes
		Waste	29,000 tonnes
		Overburden	50,000 tonnes
	Life of Project	25 years
	Annual Output	Building Stone	1,160 tonnes
		Waste	1,160 tonnes
		Overburden	2,000 tonnes

	Royalties	Building Stone @ £4.00 per tonne	£4,640
		Waste @ £0.25 per tonne	£290
		Overburden @ £0.15 per tonne	£300
		TOTAL	£5,230
	Years Purchase	25 years @ 15%	5.7467
	Capital Value		£30,055
		SAY	£30,000