36500 — Compulsory Acquisition & Compensation Valuation
Overview
Node 36500 addresses the specific valuation methodology and statutory framework applicable where property is compulsorily acquired by government or a statutory authority, rather than transacted voluntarily on the open market. Compulsory acquisition valuation engages a distinct set of considerations from conventional valuation, principally the requirement that an acquiring authority compensate the affected landowner on just terms.
The series is organised into three sub-series, each addressed in a subordinate node: just terms and statutory compensation, covering the constitutional and statutory framework requiring fair compensation and its component heads of claim; valuation for resumption, covering the methodology applied to value land actually taken as at the statutory date of acquisition; and injurious affection and severance, covering compensation for the diminution in value of land retained by an owner following a partial acquisition.
This node serves as a navigational and definitional entry point for parties requiring an understanding of compulsory acquisition and compensation valuation, directing the reader to the more detailed subordinate node addressing each component.
Scope & Boundaries
This node addresses the structure of the compulsory acquisition and compensation valuation sub-series and the general proposition that compensation valuation differs from conventional market valuation in its statutory basis and hypothetical construct. It does not itself set out general valuation methodology, addressed in node 36100, or the professional standards and reporting framework applicable across all sectors, addressed in node 36200.
It does not address the administrative or procedural steps by which an acquiring authority exercises its compulsory acquisition power, which is a legal and procedural matter addressed in APN’s separate property law content.
This node provides a structural overview of the compulsory acquisition and compensation valuation sub-series as at the time of writing. The specific compensation entitlement and valuation methodology applicable to a given acquisition should be confirmed against the applicable acquiring legislation and current case law.
Key Concepts
Regulatory & Legal Framework
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Land Acquisition (Just Terms Compensation) Act 1991 (NSW)State land acquisition authoritiesAnd equivalent legislation in other states establishes the statutory just terms compensation framework.
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Lands Acquisition Act 1989 (Cth)Commonwealth acquiring authoritiesGoverns compulsory acquisition of land by the Commonwealth.
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Valuation of Land ActState Valuers-General(state-based, for example the Valuation of Land Act 1916 (NSW) and equivalent legislation in other states) is frequently the source of the statutory valuation methodology applied in compensation assessments.
Practical Application
Compulsory acquisition compensation is assessed differently depending on whether an entire holding or only part of a landowner’s property is taken.
| Scenario | Application | Outcome |
|---|---|---|
| A state road authority compulsorily acquires part of a rural property for a highway corridor | The valuer assesses compensation comprising the market value of land taken plus injurious affection to the retained balance | The landowner receives just terms compensation reflecting the acquisition’s full impact |
| A local council resumes land for a public open space reserve | The valuer applies valuation for resumption methodology as at the statutory date of acquisition | Compensation reflects the land’s market value at the relevant statutory date |
| A landowner’s remaining holding suffers reduced access following a partial acquisition | The valuer separately assesses severance and injurious affection to the retained land | Compensation reflects the diminished utility of the remaining property |
Cross-Series References
Findings are presented on the basis of data and evidence alone.
