Battler's guide to getting fair deal
First he was offered $20,000 for his strip of land needed for road-widening.
Then $28,000. Then $45,000. They finally settled on $47,000 some 10 months later.
It shows, says Auckland homeowner Gary Osborne, that a council or government body's first offer for part of your land for essential public works may be far from fair or generous.
Osborne has penned an online survivor's guide to getting a fair deal from councils or government bodies out to buy your land under the Public Works Act. A draft is already circulating among property owners in other parts of Auckland faced with similar circumstances.
In Osborne's case, Auckland Council-controlled Auckland Transport wrote to him in September 2011, saying it wanted a narrow strip of land across the front of a rental home he owned on Te Atatu Road, which had been earmarked for road-widening to enable faster traffic flow.
The feisty Osborne immediately invited all the affected home-owners in the street to form a group, principally to support each other and share experiences and, most vitally, information.
Forming a group helps because, while the acquiring body is staffed by experienced professionals, most property owners will never have dealt with the PWA, he said.
"The acquiring authority is powerful and knowledgeable whereas the property owner is, in most cases, confronted by a one-off experience about which he knows little."
Even sharing simple information, such as valuations being no more than an opinion paid for by the acquirer, can result in people not accepting the first offer, Osborne said.
In the Te Atatu Road case, as people's offers improved, that information was used by others in their negotiations.
Osborne cited the case of another landowner who also received an opening offer of $12,000 from the CCO. Eventually, Auckland Transport paid $42,000. In a further case, a first offer of $25,000 ended at $43,000.
But not everyone joined the group. Out of the 109 or so properties, just 35 owners joined. "From what I can gather a lot of the rest settled early and did pathetically," Osborne said.
Under the Public Works Act, an acquiring authority has to negotiate with landowners to buy the property it needs and Osborne said people should realise the authority wanted to spend as little of ratepayers' money as it could.
But Auckland Transport's Chris Martin denies that, saying acquiring authorities have a duty to pay property owners compensation that leaves them in the same position as they were before the acquisition. Warwick Wright, from Rainey Collins Wright, which specialises in Public Works Act business, said: "My experience is that in many instances acquiring authorities act extremely reasonably," he said, but conceded owners could be required to take a tough stance to ensure they got a good price.
The legislation contained provisions property owners could use to their advantage, Wright said.
Wright said acquiring authorities had been known to tell people legal representation wasn't necessary, or even suggest it might leave the property owner with a large legal bill.
Acquiring authorities would only pay legal and valuation fees when they paid for the land rather than during the negotiating process. Having to pay legal bills as they fell due was hard on many households, he said. "The landowner might not have the money to do that."
A lawyer could also help a person not feel overawed or bullied by the acquiring authority. "By and large, the representatives of acquiring authorities are reasonable people, but there are a number of examples that were upsetting for the home owner," Wright said.
Martin says a properly represented property owner is easier to negotiate with, as is someone who has had their own valuation done.
Osborne urged people to get their own valuations and talk through concerns with the valuer before settling on a price.
In Osborne's case, losing the land made it impossible to turn a car around after backing out of the garage under the house. The council agreed to install a new garage to the side of the house.
Osborne got the first offer of $20,000 in October last year. He had to ask for a copy of the valuer's report.
A second offer for $28,000 followed in May but Osborne insisted on a full valuation. The council used new valuers, and the result was an offer for $45,000 in July.
Osborne got his own valuation - at $47,000 - and was paid by Auckland Transport this month.
Osborne's suggestions should you get a Public Works Act notice:
Drop flyers to all affected owners
Form a group to work together and share information
Keep a good written record
Approach your local board
Call a public meeting
Go to the local media
Compile a list of detrimental impacts on your property
Get a lawyer with Public Works Act experience, as the acquirer will pay reasonable legal fees
Sort out a valuer with PWA experience, and again, reasonable fees will be reimbursed Insist on a copy of the valuation
Get your own valuation done.
Get your lawyer to check all the conditions in the agreement.
- Sunday Star Times