Compulsory Acquisition

Compulsory acquisition is a legal process by which an Acquiring Authority can take ownership in property.

An Acquiring Authority is an entity that has been granted this power for a specific purpose. Examples include:

• government departments e.g. Department of Transport and Planning
• designated project authorities e.g. Suburban Rail Loop Authority
• government ministers
• water, gas, and electricity companies
• local government authorities, including councils

Examples of property that can be acquired:

• an entire property (whole of land acquisition)
• part of a property (partial acquisition)
• a right to use the property (easement acquisition)
• land below ground level (strata acquisition)
• improvements including buildings, fencing and landscaping

The purpose of this guide is to provide general information about compulsory acquisition in Victoria. It is not to be relied upon or used as a substitute for legal advice.

A PAO is a planning instrument applied to land earmarked for possible future compulsory acquisition. A PAD is similarly used for many large projects. You may not be notified if a PAO or PAD is applied to your land, but a prospective purchaser or security holder can find out.

A PAO or PAD can be in place for many years (even decades). It can impact:

• the value of a property
• the use of the property
• your ability to sell any part of the property
• your ability to renovate or improve the property

Need to know more about PAOs or PADs? Contact Hunt & Hunt so we can help you:

• determine if your property is affected by a PAO or PAD
• stay abreast of project developments and understand anticipated time lines
• assess your options, including compensation claims and future impacts

You may be able to claim compensation before a compulsory acquisition occurs. The Planning and Environment Act 1987 outlines circumstances in which a PAO can give rise to claims, broadly summarised as:

• “loss on sale”: a seller receives a lower price for a property than they would have received were it not for the PAO or proposed PAO
• “permit refusal”: an owner suffers financial loss due to a permit application being refused on the ground that the land may be needed for a public purpose

Loss on sale and permit refusal claims are complex and require strategic legal advice before you engage agents or planners.

Considering a loss on sale or permit refusal claim? Contact Hunt & Hunt so we can help you:

• determine if you have a right to make a claim
• consider the timing of relevant “triggers”
• assess your options, including compensation and future impacts

A NOITEL is a formal notice advising that an Acquiring Authority (or authorised persons) proposes to enter and undertake works on a property. A NOITEL may permit persons to:

• enter and remain on a property with vehicles, machinery or equipment
• install equipment, survey pegs, marks or poles
• dig or bore into the land and take samples

A NOTO allows an Acquiring Authority (or authorised persons) to access and occupy designated land for a specified purpose. A NOTO may permit persons to:

• dig and take earth, timber or other substances
• deposit and manufacture material
• make cuttings or excavations
• make and use roads on the land
• erect workshops and buildings of a temporary nature on the land

These notices may entitle you to rental payments and/or a further claim for compensation.

Have you received a NOITEL or NOTO? Contact Hunt & Hunt so we can help you:

• urgently advise the Authority of potential issues or claims, prior to entry
• determine your legal rights and obligations
• make a claim for rent and/or compensation
• collect evidence of any damage done to your property

A NOITA is a formal notice that advises interested parties that the Acquiring Authority intends to compulsorily acquire an interest in the property. It restricts sales, leases, licences, transactions and other arrangements relating to the property. It also restricts your ability to improve the property.

A NOITA usually requests a written response. You should seek legal advice before providing any reply.

A NOA is a formal notice that advises interested parties that ownership of the property (or part of the property) has transferred to the Acquiring Authority. The date of the NOA is when all acquired interests in the property are extinguished.

Have you received a NOITA or NOA? Contact Hunt & Hunt so we can help you:

• understand strict time frames
• obtain independent expert advice, such as a valuation
• prepare careful responses to the Authority
• protect your rights and future claims

Generally, the Acquiring Authority must make an initial offer of compensation within 14 days of the NOA. Then, a formal response to this offer is due within 3 months.

Have you received an offer? Contact Hunt & Hunt so we can help you:

• understand the benefits (and risks) of obtaining an advance (upfront) payment
• identify and maximise the various components of your compensation
• adhere to and enforce time frames
• obtain independent expert advice to consider the reasonableness of the offer and to substantiate further claims in a Response to Offer
• carefully prepare your claim using the prescribed statutory form, known as a Form 11 Response to Offer
• consider any litigation risks

The compulsory acquisition of even a small part of your property can be significant. Partial or easement acquisitions impact:

• market value
• development potential
• land use and amenity, including rental income
• traffic and access

Are you facing a partial or easement acquisition? Contact Hunt & Hunt so we can help you:

• obtain independent expert advice such as a valuation (which is particularly complex for partial and easement acquisitions)
• negotiate suitable reinstatement and rectification, especially in instances where fencing, landscaping, driveways or other structures are lost
• determine your legal rights and obligations

The compulsory acquisition of a business can be devastating, and navigating the process can be legally and practically complex.

At Hunt & Hunt, we understand business claimants face unique challenges. Our advice balances legal considerations with commercial realities.

Businesses facing compulsory acquisition should obtain legal advice early, as decisions made before an acquisition have profound impacts on the ultimate compensation claim.

Planning, executing, and recovering from a business relocation is an enormous undertaking. We help you navigate this process, while also working with you to maximise your compensation.

If a business cannot be relocated, we provide strategic advice about your options.

Own a business facing compulsory acquisition? Contact Hunt & Hunt so we can help you:

• understand the benefits (and risks) of obtaining an advance (upfront) payment
• obtain advice from an independent expert business valuer or a relocation consultant assessment
• understand compensation claims such as:
• relocation costs
• lost profits
• loss of favourable tenancy terms

Replacing an income-producing asset as significant and unique as real property can be extremely difficult. Acquiring Authorities generally consider strict “like-for-like” requirements, which can be challenging for even the most sophisticated property investor to navigate.

It is essential to obtain legal advice before making any changes to tenancy arrangements prior to the formal acquisition process commencing. Any change can impact both your income and ultimate compensation claim.

Negotiating time frames plays a crucial role in helping landlord investors be in the best possible position after a compulsory acquisition.

If you intend to purchase a replacement property, it is imperative you receive prior advice about which costs will (and will not be) reimbursed.

Is your investment property being compulsorily acquired? Contact Hunt & Hunt so we can help you:

• understand the benefits (and risks) of obtaining an advance (upfront) payment
• obtain advice from an independent expert valuer or buyer’s advocate
• maximise your claims for replacement property costs

There are few things as heartbreaking as losing your home. You face the added stress and difficulty of relocating your life, on top of navigating the complex claim process.

Possession is a key concern. The legislation requires the Acquiring Authority to diligently endeavour to obtain agreement as to the terms on which it takes possession.

Planning, undertaking, and recovering from moving house is an enormous task. So too is carefully ensuring your compensation is maximised.

If you are purchasing a replacement property, it is crucial you understand which reimbursement costs you can and cannot claim.

Is your home being compulsorily acquired? Contact Hunt & Hunt so we can help you:

• understand the benefits (and risks) of obtaining an advance (upfront) payment
• obtain advice from an independent expert valuer or buyer’s/tenant’s advocate
• maximise your relocation and replacement property costs claims
• negotiate the terms of possession

The Land Acquisition and Compensation Act 1986 sets out the various heads of compensation in compulsory acquisition matters. The legislation strictly defines each claim. Determining what is applicable to your case – and how much you can claim – can be surprisingly complex. Legal experience and practical industry knowledge are essential when it comes time to negotiate your claims with the Acquiring Authority.

We give clear and frank advice about your rights, your obligations, and all claims for compensation.

Talk to us about:

• “market value”
• “special value”
• “loss attributable to severance”
• “enhancement or depreciation” (in relation to adjoining or severed land)
• “loss attributable to disturbance”
• “solatium” (often described as compensation for “pain and suffering”)
• legal, valuation and other professional expenses
• replacement property costs, including Stamp Duty reimbursement
• Capital Gains Tax rollover
• reinstatement/rectification
• interest free loans
• profit rental

The formal process is set out in the legislation. However, obtaining our early strategic advice enables you to seek the outcome you want, when you want it. Compulsory acquisition cases are generally resolved by negotiation between a claimant’s lawyers and the Acquiring Authority’s lawyers. Engaging us early gives you the best negotiating position.

Settlements are usually confidential, involving expert conferences and legal “without prejudice” settlement negotiations.

If a claim cannot be resolved through negotiation, it may be referred to the Victorian Civil and Administrative Tribunal (VCAT) or the Supreme Court of Victoria. While this is not common, our extensive litigation experience empowers our clients to choose this option, if they wish.

Generally, it is not possible to stop a compulsory acquisition. However, there have been examples of planning objections or administrative law (judicial review) resulting in some variation to the ultimate project.

Compulsory acquisition is complex, driven by legislation and case law. It is not comparable to a standard conveyance, property law issue or commercial litigation. Expert advice is essential to ensure all aspects of compensation are explored and you understand your rights and legal obligations.

The practical information needed to successfully navigate this process cannot simply be found on the internet or by using AI; strategic advantage is gained by having legal experience and decades of industry knowledge.

When a claimant starts to deal with a compulsory acquisition themselves (or with a lawyer not experienced in this area), they can inadvertently impair their rights or weaken their claims. This can be difficult, if not impossible, to reverse.

We encourage you to contact us now, obligation-free, so we can discuss your early steps, even before you engage us to handle the formal compulsory acquisition process.

At Hunt & Hunt, we offer arrangements which allow claimants to ensure they will not be out of pocket for our costs.

Our Compulsory Acquisitions team has acted for claimants in relation to thousands of claims, on all types of projects, all over Victoria. We advise landowners, tenants, businesses and companies on their compensation entitlements and legal rights under the Land Acquisition and Compensation Act 1986, the Major Transport Projects Facilitation Act 2009, the Planning and Environment Act 1987, and other legislation.

Our expertise in this area is so well-regarded that we are engaged to act for other lawyers and the in-house lawyers of large and listed companies.

We provide everything from early strategic advice to litigation and post-acquisition issues. We manage your case from start to finish, so you can choose how involved you want to be. We are a dedicated team and work closely together, so you always have someone to contact.

At Hunt & Hunt, we have many decades of experience in compulsory acquisitions and related property disputes. We understand the nuances of the law and the interplay between the legislation, case law and real-world practicalities.