Belmopan Land Development Corporation Ltd v The Attorney General of Belize
| Jurisdiction | Caribbean States |
| Judge | Justices Wit,Mr Justice Saunders,Jamadar,Justices Anderson,Burgess |
| Judgment Date | 31 January 2022 |
| Court | Caribbean Court of Justice |
| Docket Number | CCJ Appeal No BZCV2021/002 |
[2022] CCJ 1 AJ (BZ)
the Honourable Mr Justice A Saunders, PCCJ
Mr Justice J Wit, JCCJ
Mr Justice W Anderson, JCCJ
Mr Justice A Burgess, JCCJ
Mr Justice P Jamadar, JCCJ
CCJ Appeal No BZCV2021/002
BZ Civil Appeal No 39 of 2018
IN THE CARIBBEAN COURT OF JUSTICE
APPELLATE JURISDICTION
Land — Acquisition — Compensation — Assessment — Valuation — Market value — Expert Evidence — Damages — Respondent unlawfully expropriated land belonging to Appellant-Appellant filed constitutional action claiming damages — Trial Judge awarded damages relying on Appellant's expert witness — Court of Appeal disregarded evidence of Appellant's expert witness and remitted case for further evidence to be taken — Whether Court of Appeal was entitled to disregard expert evidence accepted by Trial Judge — Land Acquisition (Public Purposes) Act, Cap 184 ss 3, 11, 19.
In 2002 the Government of Belize (‘GOB’) embarked on a process of compulsorily acquiring 202 acres owned by Belmopan Land Development Corporation (‘Belmopan’). The GOB failed to carry through with the compulsory acquisition process but retained possession of the land. Subsequently, GOB dispossessed Belmopan of a further 1,192 acres. It is not clear how that occurred, but Belmopan was content to let the GOB assume ownership of all 1,394 acres of land in exchange for payment by GOB of the fair market value of both parcels.
Negotiations between the parties aimed at agreeing the value were unsuccessful. Belmopan then filed a constitutional action claiming damages. On 10 November 2017, Arana J (as she then was), on GOB's admissions, entered judgment for Belmopan and ordered that the damages should be assessed and paid together with interest at the rate of 6% per annum from 1 January 2014 until the amount is fully paid.
The assessment of the damages, that is to say, more accurately, the process of determining the fair market value of the lands, ultimately turned out to be a contest between the opinions of two certified valuers. Mr Neal was called by Belmopan. With the parties' agreement, the court subsequently obtained the services of Mr Cruz as an independent expert. The two valuers were questioned on their respective appraisals. Mr Neal's view was that ‘city expansion’ was the highest and best use of the expropriated land, as part of the land abutted the city of Belmopan. On that premise, and using a formula he devised, Mr Neal valued the expropriated land at $11,549 per acre. Mr Cruz had a different view. Although he acknowledged that some of the land could also be used to expand the city of Belmopan, he nevertheless considered that its highest and best use was for agricultural purposes. He valued the land at $4,282.00 per acre.
The judge preferred the evidence of Mr Neal and awarded Belmopan the sum of $16,099,306.00 (ie, 1,394 acres @ $11,549.00 per acre) together with interest. The principal sum of $16,099,306.00 was reduced by the sum of $250,000.00 previously paid by GOB by way of an interim payment. Belmopan was also awarded costs on the prescribed costs scale.
GOB appealed the judgment. The Court of Appeal found that the testimony of Mr Neal was flawed because it was based on the hearsay evidence that GOB had acquired the land for the purpose of expanding the city of Belmopan. The court's own assessment of the evidence was that, given the size and location of the expropriated land, its highest and best use was mixed. It was suitable for both city expansion and agricultural purposes as part of it is near the Western highway, part near the city of Belmopan, and part near Cotton Tree which is an agricultural area. The court concluded that the opinions of both experts, Mr Neal and Mr Cruz, were deficient and that the decision of the judge should be set-aside and the case remitted for further evidence to be taken.
Belmopan appealed to the CCJ. The Court was narrowly divided. The President and Justices Wit and Jamadar agreed that the case should be sent back for further evidence to be taken while Justices Anderson and Burgess were of the view that the judgment of the trial judge should be restored.
The majority agreed that Mr Neal's evidence was tainted because firstly, the value that he placed on the lands was premised on his belief that the land was acquired by GOB for the purpose of ‘city expansion’. Secondly, Mr Neal's valuation methodology did not produce a fair market value of the land but instead yielded overly generous compensation to Belmopan as Mr Neal attributed to every square foot of the expropriated land a value consistent with the value of commercial land in the city of Belmopan. This was irrational because it paid no regard for such land as would be lost due to roads, drainage, utilities and the like in bringing the land to the state in which it could properly be sold at commercial values. Further, the bald concept of ‘city expansion’, without more, could not justify all the land being valued as commercial property.
The majority stated that the phrase ‘the highest and best use of the land’ is an aid to determining fair market value. It is not a principle aimed at giving a landowner compensation beyond market value. The concept expressed in the phrase is not referable only to the physical characteristics of the land, in complete isolation from social, demographic, commercial and other factors that impact upon the use and real potential of the land.
The minority were of the view that unless the evidence of Mr Neal was demonstrated by accepted jurisprudential reasons to be inadmissible or otherwise unacceptable, it was not the responsibility or mandate of the Court to reopen, or authorise the reopening of an original investigation into the market value to be assigned to the expropriated property. The minority considered that such a course of action was inconsistent with the Court's appellate function.
It was the opinion of the minority that there was a distinction between lawful and unlawful expropriation of land. Where land is expropriated outside the statutory framework, such expropriations are unconstitutional, unlawful and fall outside the authority of the Land Acquisition Act and the regime for calculation of compensation under that Act does not apply. Instead, Belmopan was entitled to damages assessed using the ordinary applicable rules of civil procedure and premised on common law principles for the award of damages. Land valuation is an art and not a science, and where the expert evidence of land valuers has been accepted by a trial court it becomes difficult for that evidence to be overturned on appeal. Since the trial judge accepted Mr Neal's evidence, and there was no basis on which to overturn that acceptance, an appellate court should not disturb the conclusions reached by the judge.
Having regard to the reasoning of the majority the Court remitted the case to the Supreme Court for further hearing. The Court also ordered the GOB a) to make an interim payment to Belmopan in the sum of $6 million (less such sums as GOB has already paid to Belmopan on account) with interest on that sum at 6% per annum from 1 January 2014 and b) to take all measures at its own expense and within a reasonable time to survey and delineate the expropriated land with a view to having the landowner transfer the expropriated land to the Government free from any taxes or duties in connection with the said transfer. Costs were also awarded to Belmopan.
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