The claim for compensation submitted by the controversial shelf company Jackson Way Properties Ltd against a Dublin local authority following the compulsory acquisition of some of its lands for a motorway project was "exorbitant in the extreme", the authority claimed yesterday.
A valuer giving evidence on behalf of Dún Laoghaire-Rathdown County Council, against which a €47 million claim has been lodged, told an arbitration hearing the claim was also "inconsistent in its calculation" and was "without foundation".
Mr David Garvey said a novel approach had been adopted by Jackson Way in calculating its claim. It had applied a residential zoning value to its lands when they were actually mainly zoned for agricultural use.
"The compensation claim of €47 million is in my respectful view exorbitant in the extreme, is inconsistent in its calculation and is without foundation," he said.
He said 20 acres of the Jackson Way lands at Carrickmines in south Dublin were acquired by compulsory purchase order for completion of the South-Eastern Motorway. He believed the lands, at the time they were acquired in June 2000, were worth £300,000 per acre, bringing the amount the company was entitled to in compensation to just over £6 million, or €7.6 million, plus appropriate professional fees.
He said the entire holding of over 100 acres had changed hands in 1993 for just £800,000.
A witness for Jackson Way, Mr John Morley, had put the value of the 20 acres acquired for the motorway at just over £9 million (€11.4 million), but he believed Jackson Way was also entitled to compensation for "injurious affection" caused by the motorway splitting its lands in two.
He said the motorway would mean any development on the remaining lands would have to be set back at least 30 metres from the motorway. This would result in several acres being "sterilised" for development purposes. He put the damages Jackson Way should be entitled to in this regard at £23.6 million (€29.9 million).
In addition to this loss, noise barriers would have to be erected at a cost of £1.5 million (€1.9million), and he believed costs incurred by the company in reinvesting its compensation would come to £3 million (€3.8 million).
In his evidence yesterday, Mr Garvey said he did not believe the company's retained lands - 18 acres on the northern side of the motorway and 68 acres on its southern side - suffered any "injurious affection". In fact, the motorway would be beneficial to the lands, providing them with improved access and improving their development potential.
He also believed Jackson Way, which is under investigation by both the Flood tribunal and the Criminal Assets Bureau, was not entitled to the cost of reinvesting whatever compensation it received. It was the practice of the council to pay such costs "where an income-generating property investment is being compulsorily acquired from a person or company who is bone fide engaged in the business of property investment in the State". In this case it would have to be considered whether the money would be repatriated abroad to be divided among shareholders of an English-based company, he said.
Moreover, he said, the rules which governed payment of compensation stated that it could be paid provided the arbitrator was "entitled to consider all returns and assessments of capital value for taxation made or acquired" by the claimant, in this case Jackson Way. "I would welcome the opportunity to review such assessments if they are available," he added.
The hearing, before independent arbitrator Mr John Shackleton, who will have to decide how much compensation Jackson Way is entitled to, continues today.