Compulsory Acquisition: 22 March 2019
Generally compensation in land acquisition matters is governed in Victoria by the Land Acquisition & Compensation Act 1986. Under the Act, it is possible for a person holding an interest in land that is acquired under the Act, to claim compensation for lost future earnings from a business that has been impacted by the acquisition.
In fact Aitken Partners have acted for claimants in this situation eg a claim by the former owner and operator of a Bed & Breakfast business whose land was compulsorily acquired. As a result of the land acquisition, the Bed & Breakfast business was forced to close and Aitken Partners were successful in obtaining compensation, not only for the market value of the land acquired, but also for lost future business earnings that would have been received by the land owner if the business had been able to continue to operate without the acquisition.
Another example would be where a land owner had plans to develop land through subdivision but compulsory acquisition of the land prevented these plans from being realised. In those circumstances, part of the measure of compensation that might be awarded could be the lost likely future profits from the proposed development.
In any claim for compensation for lost business earnings, it is necessary to build an evidentiary case to establish the likelihood of these future earnings being received had the acquisition not occurred. Of importance are financial statements for the business in the period leading up to the acquisition and any business plans and strategies that were in place at the time of the acquisition.