Electricity Supply Board v Boyle ; Electricity Supply Board v Good ; Rossmore Property Ltd v Ffrench O'Carroll

• Jurisdiction: Ireland
• Judge: Mr. Justice Quinn
• Judgment Date: 14 December 2018
• Neutral Citation: [2018] IEHC 718
• Date: 14 December 2018
• Court: High Court
• Docket Number: [RECORD NO. 2018/194JR] [RECORD NO. 2018/195JR] [RECORD NO. 2018/1555P]

[2018] IEHC 718

THE HIGH COURT

COMMERICAL

Quinn J.

[RECORD NO. 2018/194JR]

[RECORD NO. 2018/195JR]

[RECORD NO. 2018/1555P]

BETWEEN

ELECTRICITY SUPPLY BOARD

APPLICANT

AND

DESMOND BOYLE

RESPONDENT

AND

TIMOTHY MC CARTHY

NOTICE PARTY

BETWEEN

ELECTRICITY SUPPLY BOARD

APPLICANT

AND

PAUL GOOD

RESPONDENT

AND

DERMOT KELLEHER

NOTICE PARTY

BETWEEN

ROSSMORE PROPERTY LIMITED

PLAINTIFF

AND

DONAL FFRENCH O'CARROLL

AND

ELECTRICITY SUPPLY BOARD

DEFENDANTS

Property & conveyancing – Acquisition of land – Compensation – Property arbitration – Unconditional offers of compensation – Lack of consistency

Facts: The Electricity Supply Board was required to pay compensation where it exercised statutory powers to place electricity lines on private property. Under the Acquisition of Land (Assessment of Compensation) Act 1919, property arbitrator set the level of compensation where there was no agreement. There appeared to be a lack of consistency between the arbitrators in respect of the validity of unconditional offers, and orders were now sought to require the arbitrators in the instant cases to state cases.

Held by Quinn J, that he was persuaded that the requirements for stating a case had been made and that there was a clear question of law to be resolved to properly determine the matter between the parties. The Court invited submissions as to the formulation of orders to be made.

Judgment of Mr. Justice Quinn delivered on the 14th day of December, 2018

1 Where the Electricity Supply Board (‘the Board’) exercises its statutory powers to place electric lines across lands in private ownership and the owner of the property has not consented, the owner is entitled to compensation. The amount of this compensation, if not agreed, is determined by a property arbitrator appointed under the Acquisition of Land (Assessment of Compensation) Act, 1919. That Act contains rules regarding the measurement of compensation, and particular rules governing the exercise of the arbitrator's discretion in determining liability for the costs of the arbitration process. The general rule is that the arbitrator has a discretion as regards the awarding of costs. However, where an unconditional offer of compensation is made to the landowner and not accepted and the amount of compensation awarded by the arbitrator does not exceed the amount of the unconditional offer, the arbitrator shall, unless there are special reasons not to do so, order the claimant to bear its own costs of the process and pay the Board's costs incurred after the date of the offer. In a number of cases before property arbitrators, disputes have arisen regarding the validity and effect of the forms of letters containing what are described as unconditional offers made by the Board.

2 In these proceedings, orders are sought directing three property arbitrators to state cases for the opinion of this Court concerning the validity and effect of the relevant offers. The applications for entry into the Commercial List for the Boyle and Good cases cite identical reasons for instituting the current proceedings:–

‘The service of an unconditional offer is the method provided by statute pursuant to which ESB can make a former offer to the claimant of a sum that ESB believes is a fair amount in compensation and obtain costs protection, thereby minimising ESB's exposure to costs.

…different property arbitrators have reached different decisions in relation to the validity and effect of unconditional offers made by ESB…

The decisions of property arbitrators on issues related to letters of offer has created considerable uncertainty for ESB as to the manner in which it is enabled to make such offers pursuant to statute and the effect of such offers, and has undermined the efficacy of the unconditional offer process (in terms of its principle objective to save costs)…

…the validity or invalidity of unconditional offers made on the underlying reference to arbitration in this cases raises important questions of law, which have implications not only for the instant reference but for such other references to arbitration. With the increasing volume of claims, and increased quantum of compensation claimed, and the significant costs associated with arbitrations, the ability of ESB to make efficacious unconditional offers is integral to the fair and expeditious resolution of these claims.’

3 The Rossmore case is largely similar, but was framed in slightly different terms:–

‘The varying decisions of different property arbitrators on the nature of, and arising on, such letters of offer has created considerable uncertainty for ESB as to the manner in which it is enabled to make such offers pursuant to statute and has undermined the efficacy of the unconditional offer process (in terms of its principle objective to save costs) and is causing commercial issues for ESB.

Accordingly, the issues arising on the service and acceptance of an unconditional offer made on the underlying reference to arbitration in this cases raises important questions, which may have implications for other references. With the increasing volume of claims, and increased quantum of compensation claimed, and the significant costs associated with arbitrations, the ability of ESB to make efficacious unconditional offers is integral to the fair and expeditious resolution of these claims.’

4 Before turning to the facts giving rise to these proceedings it is necessary to outline the relevant statutory framework.

Electricity (Supply) Act 1927

5 S. 53 of the Electricity (Supply) Act 1927 confers on the Board the power to place electricity lines above and below ground across any land, with or without the consent of the owner and subject to certain regulations. Before exercising this power, the Board must serve a Wayleave Notice on the owner and occupier of the land, stating its intentions and describing the intended line and works. If, within fourteen days of receiving the Notice, the owner has not consented to the proposed works the Board may enter on the land and proceed and the landowner is entitled to compensation pursuant to s. 53(5) of the Act of 1927, as amended by the Electricity (Supply) (Amendment) Act 1985:–

‘If the owner or occupier of such land or building fails within the seven days aforesaid to give his consent in accordance with the foregoing subsection, the Board or authorised undertaker with the consent of the Board but not otherwise may place such line across such land or attach such fixture to such building in the position and manner stated in the said notice, subject to the entitlement of such owner or occupier to be paid compensation in respect of the exercise by the Board or authorised undertaker of the powers conferred by this subsection and of the powers conferred by subsection (9) of this section, such compensation to be assessed in default of agreement under the provisions of the Acquisition of Land (Assessment of Compensation) Act 1919, the Board for this purposes of this being deemed to be a public authority.’

S. 53(9) of the Act of 1927 reads as follows:–

‘Where the Board or an authorised undertaker is authorised by or under this section to place or retain any electric line across any land or to attach or retain any fixture on any building the Board or such authorised undertaker (as the case may be) may at any time enter on such land or building for the purpose of placing, repairing, or altering such line or such fixture or any line or apparatus supported by such fixture.’

Acquisition of Land (Assessment of Compensation) Act 1919

6 The relevant provisions of the Acquisition of Land (Assessment of Compensation) Act 1919 are as follows:–

‘1. — (1) Where by or under any statute (whether passed before or after the passing of this Act) land is authorised to be acquired compulsorily by any Government Department or any local or public authority, any question of disputed compensation, and, where any part of the land to be acquired is subject to lease which comprises land not acquired, any question as to the apportionment of the rent payable under the lease, shall be referred to and determined by the arbitration of such one of a panel of official arbitrators to be appointed under this section as may be selected in accordance with rules made by the Reference Committee under this section.

4. Where notices to treat [which include Wayleave Notices pursuant to the Electricity (Supply) Amendment Act 1985] have been served for the acquisition of the several interests in the land to be acquired, the claims of the person entitled to such interests shall, as far as practicable, and so far as not agreed and if the acquiring authority so desire be heard and determined by the same official arbitrator, and the Reference Committee may make rules providing that such claims shall be heard together, but the value of the several interests in the land having a market value shall be separately assessed.

5. — (1) Where the acquiring authority has made an unconditional offer in writing of any sum as compensation to any claimant and the sum awarded by an official arbitrator to that claimant does not exceed the sum offered, the official arbitrator shall, unless for special reasons he thinks proper not to do so, order the claimant to bear his own costs and to pay the costs of the acquiring authority so far as such costs were occurred after the offer was made.

5. —(4) Subject as aforesaid, the costs of an arbitration under this Act shall be in the discretion of the official arbitrator, who may direct to and by whom and in what manner those costs or any part shall be paid, and the official arbitrator in any case may disallow the cost of counsel.

5. — (5) An official arbitrator may himself tax the amount of costs to be paid, or may direct in what manner they are to be taxed.

6. — (1) The decision of an official arbitrator upon any question of fact, shall be final and binding on the...