Compulsory Acquisition

A valuation under the Land Acquisition (Just Terms Compensation) Act 1991 (NSW) is a formal assessment of the market value and associated compensable entitlements for land that is being compulsorily acquired by a government authority. This valuation forms the foundation for determining the amount of compensation payable to the dispossessed landowner, ensuring it reflects “just terms” as required by the Act.

What is It?

The valuation is conducted to determine the market value of the land as at the date of acquisition, assuming the land is unaffected by the acquisition proposal. It must reflect the price that would be agreed between a willing buyer and seller in an arm’s-length transaction, in line with the principles established in Spencer v Commonwealth (1907).

When Do You Need One?

You need a valuation under the Just Terms Act when:

• Land is acquired compulsorily by a public authority (e.g. for infrastructure, transport, or public use)
• You receive a Proposed Acquisition Notice (PAN) or Acquisition Notice under the Act
• You wish to negotiate compensation or lodge a claim for compensation
• You intend to challenge the amount offered or prepare for proceedings in the Land and Environment Court

Valuations are also used in hardship acquisition requests, where landowners can compel acquisition if they meet hardship criteria.

What Heads of Compensation Are Covered?

Section 55 of the Act outlines the six heads of compensation that must be considered:

Market Value

The amount the land would have sold for on the open market at the date of acquisition, assuming no influence from the acquisition itself.

Special Value

Additional value the land holds for the claimant due to unique use, location, or personal/business circumstances not shared by the general market.

Loss Attributable to Severance

Reduction in value of the remaining land when only part of the property is acquired, due to diminished utility, access, or development potential.

Loss Attributable to Disturbance

Costs incurred as a direct result of the acquisition, such as relocation expenses, legal and valuation fees, stamp duty on replacement property, and business disruption.

Solatium

Compensation for non-financial loss, such as emotional distress or inconvenience, particularly when the land is the claimant’s principal place of residence.

Decrease in Market Value of Other Land

Any reduction in value of other land owned by the claimant caused by the acquisition (e.g. loss of access, amenity, or development potential).

Why Estate?

We are highly experienced in undertaking valuations under the Land Acquisition (Just Terms Compensation) Act 1991 (NSW), providing expert assessments that support fair and accurate compensation outcomes for property owners affected by compulsory acquisition. Our team specialises in evaluating all heads of compensation – including market value, severance, disturbance, and solatium – and delivers clear, evidence-based reports tailored to each property’s unique circumstances. We actively engage in negotiations with acquiring authorities to secure just terms for our clients and, where necessary, offer professional representation in the Land and Environment Court to ensure their interests are fully protected throughout the acquisition process.