5 things you need to know when you’re forced to put a price on the land you love.
Meyer Vandenberg is currently working with the members of a long-standing pastoral family in South Australia to calculate the compensation payable to them after the Commonwealth Department of Defence compulsorily acquired their land for expanded training facilities. Our client’s land was around 1,000 square kilometres, with a merino fine-wool sheep business run on it for 5 generations.
Advising our clients on the compensation they’re entitled to receive has been a complex and, at times, emotional job. However, with the Department of Defence set to acquire a significant amount of rural land to expand training facilities in North Queensland, many more families will soon be faced with the difficult task of putting a price on the land they live on, work on and love.
Here are 5 things you need to know if you’re worried the Government may be looking to acquire your farm under the Commonwealth Lands Acquisition Act 1989 (“the Act”).
# 1 You can ask the Government for an advance payment of compensation to cover your expenses
Once your land has been acquired, you have a period of 6 months to vacate unless another period is fixed by agreement between you and the Government. Shutting down a rural business in that time can be a complicated and costly undertaking. For our clients, it included selling off plant and machinery, dismantling buildings such as holding sheds, calling in extra farm hands to muster and shear around 16,000 sheep and then selling all those sheep at once.
Compensation is generally paid at the end of the claim process, which can be lengthy. However, the Act does allow the Government to make an advance payment of money on account of compensation that may be payable to you in the future.
Help your cash flow by applying for an advance payment of compensation to cover costs associated with vacating your land, or obtaining legal advice to pull together your claim.
# 2 Don’t rush your claim because there’s no time limit
If your land is acquired, the Act requires you to put together your own claim for compensation. Your claim must set out the amount of compensation you believe you’re entitled to receive and it needs to be supported by evidence.
However, the Act doesn’t specify a time limit within which you’re required to submit your claim. So take your time, make sure you get the right advice and find the right team of experts to put forward a well-supported claim.
# 3 You may be able seek compensation to relocate your farming business to a new property
If you intend to purchase new land to relocate your farming business, you may be able to seek an amount of compensation from the Government to cover the costs of acquiring new land and reinstating your business.
# 4 Your farmhands may be entitled to compensation too
When your land is acquired, every person who has an interest in your land on the date of acquisition is entitled to compensation. An “interest in land” covers any right, charge, power or privilege over or in connection with your land. Examples include anyone with a licence to hunt on your land, the local scouts club that hold their camp-outs on your land and especially any farmhands that live and work on your land.
If your farmhands live in a house on your land immediately before your land is acquired, they may be entitled to an amount of compensation known as “solatium”. Solatium is additional compensation (the amount of which is fixed by the Act) awarded to someone as a result of the acquisition to account for the angst of being uprooted from their home.
# 5 Above all, you must be justly compensated for what you’ve lost
The claims process set out in the Act has an overriding requirement that a dispossessed landowner is awarded an amount of compensation that justly compensates them for their loss. In considering the amount you require to justly compensate you for the loss of your land, regard must be had to all of your circumstances and all relevant matters.
Your land and any business you run on it are unique. Similarly, there’s no one-size-fits-all approach to working out how you should be compensated. The Act gives scope for a variety of different approaches to determining compensation. For this reason, it’s important you engage a legal team with expertise in the Act and its application.
It’s a complex task to properly understand the nuances of your land and your business to determine which method of assessing compensation is most appropriate for you. Of course, local-knowledge is important but don’t dismiss the idea of going out of area for expertise in compulsory acquisition law.
For our South Australian clients, we’ve assembled a team of expert valuers, agricultural advisers and the country’s leading barristers in this area of law to properly understand our clients’ land, their business, the environment in which the land sits and the business operates, the impact of the compulsory acquisition and how “just” compensation can be calculated in accordance with the Act.
When the Government takes your land, we know they’re taking more than just land – they’re taking your lifestyle, your future and your heritage. As our clients have said “money will never substitute your identity”, but with the right legal team on your side, you’ll have a compensation claim that reflects the true value of what you’ve lost and help you rebuild a new life.
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