Re Salt Rocks Dock

• Jurisdiction: Cayman Islands
• Judge: Douglas, Snr. Magistrate
• Judgment Date: 15 January 1990
• Date: 15 January 1990
• Court: Summary Court (Cayman Islands)

(Summary Ct.

Douglas, Snr. Magistrate

In re Salt Rocks Dock

PLANNING LAW

COMPULSORY ACQUISITION-valuation of beachfront land with dock and wharf extending over seabed

An enquiry was held under s.11(1) of the Land Acquisition Law (cap. 81), as amended to determine, inter alia, what compensation the Government should pay for the compulsory acquisition of seafront land in Little Cayman. The Government had taken a 15-year lease on the land with an option to renew. It had been agreed, in keeping with standard practice, that any land-based fixtures erected by the Government would revert to the owners of the land on the expiry of the lease. At the beginning of these proceedings there were still 10 years of the lease remaining but having spent a considerable amount in constructing a dock facility and extending the existing wharf on to the seabed, the Government now wished to acquire ownership of the land. It accordingly made the claimants an offer based upon its own valuation, including an extra $3,000 beyond what it considered to be the true value of the site.

The owners refused the offer basing their objections on, inter alia, (a) the Government”s incorrect valuation of the site; (b) their claim that the seabed improvements should properly revert to them at the end of the lease; and (c) the fact that no account had been taken of the land”s special suitability, namely that the site was the best location on the Island for a deep-water harbour and had great potential for providing a lucrative facility in the light of increased tourist and construction developments in Little Cayman in the foreseeable future.

Held: (1) In evaluating fair compensation for the land the court would accept certain principles, namely (i) beachfront land was to be valued by the running foot; (ii) the valuation should reflect the present-day value of the property and not an anticipated value based on inflation up to the end of the lease; (iii) the ‘open market approach’ was the appropriate method, i.e. a calculation based on the price which a willing vendor might reasonably expect to obtain from a willing purchaser at the date of valuation; and (iv) the owners should be adequately compensated for any special suitability inherent in the land itself even if the acquiring authority was the only possible purchaser.

(2) Although...