Purchase notices where land cannot be reasonably used

A purchase notice is the remedy that forces a council to buy land when a planning refusal has left it incapable of reasonably beneficial use. It sits in section 137 of the Town and Country Planning Act 1990, it has a twelve month deadline, and it succeeds rarely. Knowing why it succeeds rarely is the useful part, because the same reasoning tells you whether your case is one of the few worth running.

The test is not whether the land is worth less than you hoped. It is whether the land, in its existing state, is incapable of reasonably beneficial use.

The circumstances that open the remedy

Three things have to coincide. Permission must have been refused, or granted subject to conditions. The owner must claim that the land in its existing state is incapable of reasonably beneficial use. And the owner must claim that the land cannot be rendered capable of reasonably beneficial use by carrying out any development for which permission has been granted, or which the authority or the Secretary of State has undertaken to grant.

The remedy is also available in adjacent situations: after a revocation or modification order, after a discontinuance order, and, under the listed buildings legislation, after a refusal of listed building consent, where a separate purchase notice route applies to a listed building incapable of reasonably beneficial use.

What it is not is a compensation claim for a refused planning permission. English planning law gives no general right to compensation for a refusal, and the purchase notice is a narrow exception dealing with land that has been left useless rather than merely less valuable.

The reasonably beneficial use test

This is where almost every notice fails, and the reason is in the statute. In deciding whether land is capable of reasonably beneficial use, no account is taken of any unlawful use, and no account is taken of any prospective use that would involve development other than the limited categories of existing use development set out in the Act's own schedule.

So the comparison is not between the value with the refused scheme and the value without it. The question is whether, ignoring the development you wanted, the land as it stands has any use that is reasonably beneficial to the owner or to a person in the owner's position. A field that can be grazed or cropped has a reasonably beneficial use. A garden attached to a house has one. A yard that can be let for storage has one. Woodland with a timber value has one.

Two further points that decide cases. Use is judged objectively, in relation to the land itself, rather than by reference to the particular circumstances or needs of the current owner. And a use that produces a modest return is still a use: the test is reasonably beneficial, not profitable.

Sites that do succeed tend to share features. They are small or awkwardly shaped, physically constrained, without access, with no agricultural or amenity value, and often left over from something else. Land sterilised by a constraint that no lawful use can overcome comes closest.

Serving the notice and the time limit

The notice is served on the district or unitary council for the area, within twelve months of the decision that triggers it. Miss that and the remedy is gone, whatever the merits.

Get the following into the notice and into the supporting statement:

1. The land, described and shown edged red, with the owner's interest identified.
2. The decision relied on, by reference and date.
3. A statement that the land is incapable of reasonably beneficial use in its existing state.
4. A statement that it cannot be rendered capable of reasonably beneficial use by any development for which permission has been granted or undertaken.
5. The evidence: valuation, marketing history, physical constraints, and an assessment of every potential use considered and rejected.

That fifth item is where the case is made. A notice asserting the conclusion without working through grazing, storage, amenity, parking, forestry, recreation and every other candidate use is easy for an authority to resist.

How the authority may respond

The council has three months to serve a counter notice. It has three options: confirm that it is willing to comply, state that another authority or a statutory undertaker is willing to comply instead, or state that it is not willing to comply and that it has referred the notice to the Secretary of State with its reasons.

Most contested notices reach the third option. The authority's reasons will normally argue that a reasonably beneficial use remains, or that the land could be rendered capable of such use by development it would be prepared to permit. Anticipate the second of those, because an authority can defeat a notice by undertaking to grant permission for something modest.

Referral to the Secretary of State

On referral the Secretary of State can confirm the notice, refuse to confirm it, substitute a different authority, or take a different course altogether: granting permission for the development that was refused, or varying the conditions that caused the problem, or granting permission for some other development that would make the land capable of reasonably beneficial use.

That last set of powers is what makes the process unpredictable. A landowner who serves a notice hoping for a purchase may instead receive a permission, which resolves the statutory problem without producing a sale. It is a real outcome and it should be discussed with the client before the notice goes in.

Where the notice is confirmed, the authority is deemed to be authorised to acquire the land compulsorily and to have served notice to treat on the date of confirmation.

Compensation and how it is assessed

Compensation follows the compulsory purchase rules in the Land Compensation Act 1961. The starting point is market value of the land in its existing state, assessed by reference to the statutory planning assumptions, which means the refused scheme is disregarded.

That produces an uncomfortable arithmetic. If the land really is incapable of reasonably beneficial use, its market value in that state is low, so a successful purchase notice delivers a sale at a low figure rather than the development value the owner was pursuing. Disturbance and related items may be recoverable, and the process itself carries professional cost.

Where the Secretary of State grants permission instead of confirming the notice, separate compensation provisions can apply for loss attributable to the delay or to conditions imposed.

Practical prospects and the evidence needed

Be honest with a client at the outset. The notice is worth serving where the land is small, constrained, inaccessible and demonstrably without any lawful use, and where the owner would accept existing use value to be rid of it. It is not a route to development value, and it is not a lever in a negotiation about a refused scheme.

Assemble three evidence strands before committing: a valuation of the land in its existing state by a chartered surveyor, marketing evidence showing the absence of any market for it in that state, and a technical statement addressing each candidate use with the physical or legal reason it is unavailable. On rural land, that technical statement usually has to deal with agricultural capability, and an Agricultural Land Classification assessment showing poor grade land with no viable cropping or grazing option carries real weight.

Keep the planning case and the purchase notice case separate in your head. The Planning Statement supporting an application argues the merits of development, while a purchase notice argues the absence of any alternative. Running both from the same document produces an argument that undermines itself, and valuation work for one is not valuation work for the other, as the note on benchmark land value shows. Where value is the live issue on a scheme rather than usability, a Viability Assessment is the relevant document instead.

PlanScope provides AI-assisted draft reports for planning applications. Reports should be reviewed before submission. We do not guarantee planning approval. This is general guidance, not legal advice; take legal and valuation advice before serving a purchase notice, because the twelve month deadline cannot be extended.