Belfast property owner loses NI vesting case

Joel Kerr, who was left with no property and a mortgage shortfall of £50,000 after his house was vested by the Northern Ireland Housing Executive (NIHE), has lost his attempt to win compensation.

Under the rules of vesting the NIHE can issue a compulsory purchase order for a property, and are required to pay market value to the owner, irrespective of how much they paid for it. Mr Kerr purchased his property in Moltke Street in Belfast in 2007 with a £150,000 mortgage. In 2010 properties in the street were the subject of compulsory purchase orders and Mr Kerr received market value compensation of £91,000, leaving him with a £50,000 debt remaining from his original mortgage.

Other property owners in the area were similarly affected, and Mr Kerr's case at the Lands Tribunal was to be the test of whether compensation would be payable to those left in debt, and without a home. His solicitor argued that the full value of the property should have been paid, and that under European human rights law, an excessive burden had been placed on his client.

Lord Justice Sir Patrick Coghlin ruled that the applicant had suffered as a result of the disastrous collapse of the property market which had occurred before, and independently of, the vesting order", and that he was not therefore entitled to compensation. He did however award him legal costs and suggested that the Department for Social Development consider its policy in respect of vesting orders were the owners are in negative equity.