Assets of Community Value (“ACV”) are a relatively new statutory innovation introduced by Part 5 of the Localism Act 2011 (the “Act”) and the Assets of Community Value (England) Regulations 2012.
The Act requires local authorities to keep a list of the assets that it holds that are deemed to have a community value. Under Section 88 of the Act an asset may be listed where it has a main current “actual use” which furthers social wellbeing or social interest for the community and this interest can continue or where the use is historic could resume in the next five years. Local authorities have to notify owners of any asset’s inclusion on the register and owners can ask for this decision to be reviewed.
The practical effect of an asset being on the ACV list is that any owner selling or granting a long lease of the asset must give notice to the local authority.
Interested groups in the community then have six weeks to present themselves as a bidder. If they do so then the sale cannot take place for six months, apart from to one of the community groups. This is to enable the group to come up with another proposal for the land. At the end of the six month period the owner can dispose it as they wish.
A recent Court of Appeal decision (Banner Homes Limited -v- St Albans City and District Council  EWCA Civ 1187 has clarified the application of the Act in the circumstances where use has, or continues to, constitute trespass.
Banner Homes had owned undeveloped open land (the “Land”) at St Albans since 1986. Two public footpaths bisected the Land. The Land had been used by the public for in excess of 40 years for recreational activities such as dog walking and kite flying. Banner Homes were well aware of such use.
In 2014 St Albans City and District Council listed the Land as an ACV after it was nominated as such by members of the public.
It was accepted that use of the Land, save for use of the footpaths, was an act of trespass.
In 2014 Banner Homes requested that the Council review its decision to demark the Land as an ACV and they fenced off the Land so only the footpaths could be accessed. The Council refused to review the decision and Banner Homes’ subsequent appeals to the First and Upper Tribunals were unsuccessful.
Banner Homes appealed to the Court of Appeal. They argued that as the use of the Land by the community was a trespass then such use had been unlawful and was not capable of being an ACV. The Court of Appeal did not agree stating that use of the Land did not have to be lawful for it to be assigned ACV status. The Court was reluctant to make a finding that any unlawful use of the Land, however slight, would prevent land being listed as an ACV.
Designation of land as an ACV does not ultimately obstruct development but such designation could be treated as a material planning consideration by the planning authorities. Further, the process that has to be gone through when land has been stated to be an ACV could slow down development and reduce the value of the site. However, land owners must be alive to the availability of the appeal process, firstly to the Council in question, and then to the First Tier Tribunal. This could negate a large measure of delay and uncertainty in the future.