Plain language law

New Zealand law explained for everyone

Public Works Act 1981

Compensation - Entitlement

62: Assessment of compensation

You could also call this:

“How the government decides how much to pay you if they need your land”

When the government needs to take your land for a public project, they must pay you fairly. Here’s how they figure out how much to pay you:

The government looks at how much your land would sell for if you were selling it willingly to someone who wanted to buy it. They don’t consider that you’re being forced to sell.

If only part of your land is taken and that part isn’t something people usually want to buy, they might look at the value of all your land and subtract the value of what’s left after they take their part.

They won’t count any increase or decrease in value caused by the public project itself.

They won’t consider any special use for the land that only the government could do.

If the project makes your other land more valuable, they might pay you less to make up for that increase in value.

If you’re renting the land or letting someone else use it, that arrangement can be valued separately from the land itself.

The government decides on a specific date to use when figuring out the value. This date depends on when they took the land or started work on the project.

These rules help make sure you’re treated fairly when the government needs to use your land for a public project.

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This page was last updated on

View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=DLM46358.

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Part 5 Compensation
Entitlement

62Assessment of compensation

  1. The amount of compensation payable under this Act, whether for land taken, land injuriously affected, or otherwise, shall be assessed in accordance with the following provisions:

  2. subject to the provisions of sections 72 to 76, no allowance shall be made on account of the taking of any land being compulsory:
    1. the value of land shall, except as otherwise provided, be taken to be that amount which the land if sold in the open market by a willing seller to a willing buyer on the specified date might be expected to realise, unless—
      1. the assessment of compensation relates to any matter which is not directly based on the value of land and in respect of which a right to compensation is conferred under this or any other Act; or
        1. only part of the land of an owner is taken or acquired under this Act and that part is of a size, shape, or nature for which there is no general demand or market, in which case the compensation for such land and the injurious affection caused by such taking or acquisition may be assessed by determining the market value of the whole of the owner's land and deducting from it the market value of the balance of the owner's land after the taking or acquisition:
        2. where the value of the land taken for any public work has, on or before the specified date, been increased or reduced by the work or the prospect of the work, the amount of that increase or reduction shall not be taken into account:
          1. the special suitability or adaptability of the land, or of any natural material acquired or taken under section 27, for any purpose shall not be taken into account if that purpose is a purpose to which it could be applied only pursuant to statutory powers, or a purpose for which there is no market apart from the special needs of a particular purchaser or the requirements of any government department or of any local authority:
            1. the Tribunal shall take into account by way of deduction from that part of the total amount of compensation that would otherwise be awarded on any claim in respect of a public work that comprises the market value of the land taken and any injurious affection to land arising out of the taking, any increase in the value of any land of the claimant that is injuriously affected, or in the value of any other land in which the claimant has an interest, caused before the specified date or likely to be caused after that date by the work or the prospect of the work:
              1. the Tribunal shall take into account, by way of deduction from the total amount of compensation that would otherwise be awarded, any increase in the value of the parcel of land in respect of which compensation is claimed that has occurred as a result of the exercise by the New Zealand Transport Agency of any power under section 91 of the Government Roading Powers Act 1989.

                1. In this section, the term specified date means—

                2. in the case of any claim in respect of land of the claimant which has been taken pursuant to section 26, the date on which the land became vested in the Crown or in the local authority, as the case may be:
                  1. where compensation is claimed under section 80 and the Minister or the local authority has (before the issue of the Proclamation) notified the Tribunal what land he or it proposes to take—whichever is the earliest:
                    1. the date of that notification; or
                      1. the date of the first entry upon the land for construction purposes; or
                        1. the date on which the land is first injuriously affected by the work; or
                          1. the date of any agreement made under section 80(1)(c) or any date specified in such an agreement—
                          2. in the case of any other claim in respect of land of the claimant which has been or is proposed to be taken for any work, the date on which the land became by Proclamation or declaration vested in the Crown or in the local authority, as the case may be, or the date on which the land was first entered upon for the purpose of the construction or the carrying out of the work, whichever is the earliest:
                            1. in the case of any claim in respect of any work for which no land of the claimant has been taken and no land of the claimant is proposed to be taken, the date of the commencement of the execution of the portion of the work that causes damage to or injuriously affects the land of the claimant:

                                1. Where any lessor's or lessee's estate or interest in any land is taken or acquired under this Act, such estate or interest may, if required by its owner, for the purpose of assessing compensation under this Act, be valued separately from the freehold.

                                Compare
                                • 1944 No 31 s 29
                                Notes
                                • Section 62(1)(f): amended, on , by section 50(1) of the Land Transport Management Amendment Act 2008 (2008 No 47).
                                • Section 62(1)(f): amended, on , by section 116(4) of the Government Roading Powers Act 1989 (1989 No 75).
                                • Section 62(2)(e): repealed, on , by section 50(1) of the Land Transport Management Amendment Act 2008 (2008 No 47).