Compensation

Compensation is used in both English and Scottish law to denote the claim which arises to the owner or occupier of land which is taken for the purposes of a public undertaking under statutory powers, or which is injuriously affected by the execution of public works. The question is generally referred to arbitration, under the Lands Clauses Act, and the award is final as to the amount of damage. The claim includes such matters as loss of profits from shop, interference with access and amenity, nuisance from smoke, &c. Formerly, fifty per cent. used to be added for compulsory purchase, but latterly awards have been more moderate. Compensation is also the name given in recent statutes to the right of an outgoing tenant in respect of certain classes of unexhausted improvements which are scheduled to the acts. See AGRICULTURAL HOLDINGS ACT. The word is loosely applied to any claim of damages arising in respect of injury. Thus in event of legislation interfering with the business of the publicans (in the way of limitation or prohibition), it is strongly affirmed by some, and as strongly denied by others, that the publicans are entitled to compensation. In Scots law its proper meaning is that mutual creditors and debtors may set off one debt against another. This applies, as it did in the civil law, to most pecuniary obligations, but in order that one debt may extinguish another, so as to stop interest, &c., compensation must be pleaded. Even where an unliquidated claim of damages is opposed to an ascertained debt, time will be given to constitute, if the claims arise under the same contract.