Community right to buy abandoned, neglected or detrimental land: full guidance

1.13. Compensation/grants

Rights to compensation

1.13.1. Any person, including the landowner, who has incurred loss or expense is entitled claim compensation for that loss or expense from the Part 3A CB (section 97T of the Act). This covers loss or expenses incurred:

• in complying with the requirements of Part 3A of the Act following an application (section 97T(1)(a) of the Act);
• as a result of the Part 3A CB's withdrawal from the Part 3A right to buy process or otherwise failing to complete the purchase after having confirmed its intention to do so (section 97T(1)(b) of the Act);
• as a result of the failure by the Part 3A CB to complete the purchase (section 97T(1)(c) of the Act).

1.13.2. However, the Part 3A CB will not be liable to pay compensation where an application for consent has been refused by Ministers (section 97T(2) of the Act). Should this be the case, the landowner is entitled to recover the amount of any losses or expenses incurred in complying with the requirements of Part 3A of the Act following the making of an application by a Part 3A CB from Ministers (section 97T(3) of the Act).

1.13.3. The process for making a claim for compensation is set out in the Community Right to Buy Order 2018 (137). A claim for compensation under section 97T(1)(a),(b) or (c) must be submitted within the period of 90 days beginning:

• on the final settlement date;
• on the date that the Part 3A CB informed Ministers that it has withdrawn its application or withdrawn its confirmation of its intention to proceed; or
• the date that the Part 3A CB application is to be treated as withdrawn under section 97R(5) of the Act.

A claim for compensation under 97T(3) of the Act must be submitted within the period of 90 days beginning with the date of notification of the refusal by Ministers to grant the Part 3A CBs application.

1.13.4. Where the parties cannot agree whether compensation is payable, or the amount of such compensation to be paid, within 60 days from the date of the submission of the claim for compensation, then either party may refer the question to the Lands Tribunal for a decision (section 97T(5) of the Act).

Grants for Part 3A CB's towards the payment of compensation

1.13.5. In given circumstances, Ministers are able to pay a grant towards a Part 3A CB's liability for compensation (section 97U of the Act). To apply for such a grant, the Part 3A CB needs to demonstrate that:

• after payment of outstanding liabilities incurred by the purchase of the land, the Part 3A does not have sufficient funds to pay in full the compensation required;
• the Part 3A CB has already taken all reasonable steps to try to obtain the compensation amount required but have been unable to do so; and
• it is in the public interest that Ministers pay the grant.

1.13.6. The process of applying for a grant towards compensation costs is set out in the Community Right to Buy Regulations 2018 (no. 140). The Part 3A CB should make an application to Ministers, on the form in schedule 5 of the Regulations, within 90 days of the date on which the Part 3A CB and the claimant agreed the amount of compensation payable or the date on which the Lands Tribunal determined the amount of compensation payable (under section 97T(5) of the Act). The Ministers' decision on an application for a grant towards compensation costs is final (section 97U(8) of the Act).