Part 2: Compulsory Purchase Etc Chapter 2: Other provisions relating to compulsory purchase Section 35: Compensation for disturbance
Persons in lawful possession of, but without any further interest in, land which is to be compulsorily acquired (licensees) are entitled to compensation for disturbance representing the losses caused by reason of losing possession of the land. Where the person is carrying on a trade or business then regard is had, when calculating the losses, to the period for which the land occupied by the person might reasonably have been expected to be available for the purpose of the person’s trade or business.
	For protected tenancies (those with the protection of Part 2 of the Landlord and Tenant Act 1954), the right of a tenant to apply for a new tenancy is taken into account in the assessment of compensation for the acquisition of the interest of the landlord or tenant.
	Disturbance payments for licensees and secure tenancies is to be contrasted with the historic position for minor tenancies (a tenancy with less than a year left to run, or a tenancy from year to year) and for unprotected tenancies (those without the protection of Part 2 of the Landlord and Tenant Act 1954). Case law (Bishopsgate Space Management v London Underground [2004] 2 EGLR 175) had held that for these purposes it has to be assumed that the landlord would terminate the tenant’s interest at the first available opportunity following notice to treat, whether or not that would happen in reality.
	This section brings the assessment of compensation for disturbance for minor and unprotected tenancies into line with that for licensees and protected tenancies. It provides that regard should be had to: the likelihood of either continuation or renewal of the tenancy; the total period for which the tenancy might reasonably have been expected to continue; and the likely terms and conditions on which any continuation or renewal would be granted. For protected tenancies, this section also provides that the right of a tenant to apply for a new tenancy is to be taken into account.
	This section extends and applies to England and Wales only.