The cost of justice: certainty?

Are the Courts starting to be more generous to Councils when they make mistakes when granting planning permission?

The Court of Appeal confirmed the judgment of a lower court centred around an error by Wirral Borough Council. Wirral Borough Council mistakenly granted planning permission to Thornton Hall for three marquees within the Thornton Manor estate without any planning conditions. This Council had intended to issue the permission temporarily for a period of 5 years. This was apparent in the committee report and the section 106 agreement, which included a draft decision notice. The appellant waited 5 years and informed the Council that the marquees still stood.   

Exceptionally, the initial judgment granted a 5 year extension of time for the judicial review. The permission was quashed, with Thornton Hall’s knowledge of the error being cited as important. While the facts are extremely specific, it does open up the scope for judicial review way past the usual 6 week period. The decision prioritises proper planning outcomes over the need for a clear and certain planning record.

The Supreme Court supported Lambeth Borough Council on a similar case earlier in the month. The site involved a Homebase store originally granted permission in 1975. A section 73 application to vary an extant permission to sell a wider range of goods was granted to the site in 2010. The new consent explicitly stated that this was limited to ‘non-food goods’.  A further section 73 permission was granted in 2014, and did not include the ‘non-food goods’ condition. The landlord applied for a certificate of lawful use and argued that there were no restrictions on what could be sold. On appeal the inspector agreed and a certificate of lawful use was issued.

The Secretary of State was ruled to have acted correctly by the High Court and Court of Appeal. The Supreme Court overruled this judgment. It found that the conditions of the 2010 section 73 permission continued to have effect, so far as they were consistent with the 2014 permission.

This adds an element of uncertainty into the interpretation of the planning history of a site. It means applicants will have to pay close attention to previous section 73 permission(s) and their conditions and work out whether earlier restrictive conditions should be considered to be “rolled forward”.  That is a rather subjective approach.

In both cases the outcome was understandable.  Why should the public at large suffer, and the owner gain, from Council mistakes? On the other hand the decisions make it more difficult to be clear about what uses are lawful.  Justice comes at the cost of certainty and simplicity.

With thanks to George Fennell who assisted in preparing this blog post.

Reserved Matters approval can be amended

In R (on the Application of Fulford Parish Council) v City of York Council [2019] EWCA Civ 1359 the Court of Appeal has generously confirmed that the statutory power conferred by section 96A of the Town and Country Planning Act (“the Act”) to make non-material changes to a planning permission includes the power to make non-material changes to conditional approvals of reserved matters.

Persimmon Homes’ outline planning permission was granted for approximately 700 dwellings subject to a large number of conditions.  A conditional approval of a reserved matters application was granted by York City Council that included the requirement to submit for approval a detailed Bat Mitigation Strategy prior to any development taking place.  York City Council then approved an application for a non-material amendment that permitted changes to the bat house types and layouts, and changes to the strategy.  In response, Fulford Parish Council brought a judicial review on the basis that section 96A’s statutory power is limited to making non-material amendments to “planning permissions”, and the approval of reserved matters did not constitute a “planning permission”.

Referring to the primary source of the power to grant planning permission (s.70(1) of the Act), the court decided that the grant of outline planning permission is the grant of planning permission defined by the Act and since the grant is “subject to” conditions, the conditions must be seen as an intrinsic part of the grant; therefore the conditional approval of a reserved matters application is itself a condition to which the planning permission has been granted. 

In the court’s judgment:

  1. the “planning permission” referred to in s.96A refers to a package consisting of the grant of planning permission itself, together with any conditions to which it is subject, whether the conditions are imposed at the time of the grant or subsequently; and
  2. the application for an amendment to an approval (or conditional approval) of reserved matters is an application for the alteration of an existing condition, which is expressly permitted by s.96A(3)(b).

Importantly, the court stressed that the power under s.96A is restricted to non-material changes otherwise the need for public participation will again be required and the change will be outside of the powers of s.96A.

Whilst this judgment will be welcomed by developers, a word of caution –  as the term “non-material change” is not defined by the Act it will be important for both developers and local planning authorities to consider sensibly whether proposed scheme amendments can rightly be classified as “non-material changes” especially in those situations where there is organised local opposition to a proposal.  One possible, and ironic, outcome of the case is that authorities become even more cautious about what they will accept as non material amendments.

Failing to take account of the up to date local development plan

A recent decision by the Court of Session has quashed a planning appeal refusal determined by the Scottish Ministers for failing to take account of the up to date local development plan.   The case emphasises the importance of monitoring assumptions made as part of the planning process.

An application for planning permission in principle was made for a residential development of 600 units, including affordable housing, commercial space, a public park and a new primary school near Bridge of Allan.

When the application was submitted, Stirling’s Local Development Plan (“LDP”) did not allocate sufficient land for housing  to provide a 5 year supply.  As such, the relevant LDP housing policies would be considered out of date and Scottish Planning Policy (“SPP”) would apply. The SPP provides a presumption in favour of development which contributes to sustainable development as a significant material consideration.

However, the development was proposed on land lying within the North Stirling Green Belt and the LDP contained policies protecting the green belt from development.

The planning officer recommended the application for approval due to the benefit of the development outweighing the effect on the green belt; the SPP favouring sustainable development; the significant weight to be attached to the SPP which outweighed the policies of the LDP; and the impact of the development being mitigated by a proposed Section 75 Agreement and the imposition of planning conditions.

However, the application was refused on 23 March 2016.  The Council determined that the benefits of the development would not outweigh non-compliance with the LDP and the proposed mitigation of the impact of the development on the greenbelt, flooding and transport would not be sufficient.

An appeal was submitted and was called in by the Scottish Ministers and a Reporter was instructed to examine and report on the appeal. During the appeal process, a new LDP was being progressed which sought to provide a sufficient 5 year land supply for housing.  In his report to the Scottish Ministers, the Reporter made certain assumptions about the incoming LDP and stated that:

On the assumption that the proposed replacement development plan should identify sufficient sites, the land supply shortage may be resolved before development commences on site; … and … There is also an expectation that the proposed replacement LDP, currently under examination, will properly address the shortfall before any housing is built on this site if the appeal is allowed.

The Reporter estimated that the number of units which could realistically be provided by the proposed development within the 5 year land supply period would be 175 which was some way short of addressing the 896 unit shortfall.

The Reporter concluded that the development would only address the housing land shortfall in part; the harm to the green belt must be given considerable weight; that this would not be outweighed by the SPP presumption in favour of sustainable development; and to approve the development would be prejudicial to the emerging LDP which would set out the location of sufficient housing land for a 5 year supply.  As such, the Reporter recommended refusal of the appeal.

However, when the LDP was approved for adoption on 3 May 2018 the new LDP still did not provide a sufficient housing land  supply with a shortfall of 169 units. Despite this being brought to the attention of the Scottish Ministers in a report prepared by its officials on 17 May 2018, the Scottish Ministers issued their decision on 18 June 2018 refusing the appeal, stating that they accepted the Reporter’s recommendations and conclusions and adopted them for the purpose of their own decision. 

By doing so, the Scottish Ministers adopted a decision which was based, in part, on a material consideration regarding the emerging LDP to provide sufficient housing land supply which had later proved to be incorrect. 

The applicant appealed the Scottish Ministers’ decision to the Court of Session and Lord Carloway, delivering the opinion of the Court, determined that it was incumbent on the Scottish Ministers, as the decision maker, to take into account all relevant material considerations.  In this instance, the Scottish Ministers in adopting the Reporter’s recommendation, had (1) taken into account a material consideration which had become irrelevant; and (2) failed to take into account a material consideration that the approved emerging LDP did not provide a sufficient housing land supply.  Therefore, the decision to refuse the appeal was quashed. The Court of Session can only review the legal validity of the appeal decision and cannot substitute its own decision.  It therefore falls upon the Scottish Ministers to reconsider the appeal.  They will have to be more careful next time.

Transient Transparency?

In the recent Paddington Cube case, the Court of Appeal has confirmed that, at the moment, the Secretary of State (SoS) is required to give reasons when deciding whether or not to call in any planning permissions pursuant to Section 77 of the Town and Country Planning Act 1990.

SAVE’s appeal centred around the basis that the SoS should give reasons when deciding not to call in an application on two grounds, (i) there was a legitimate expectation to do so and (ii) there was a common law duty to give reasons. The Court allowed the appeal on the first grounds but dismissed it on the second.

On the basis that the SoS had previously given commitments publicly to give reasons when deciding not to call in applications, the Court found that this gave rise to a legitimate expectation that the “promised” approach would be followed and reasons therefore given.

In this case, the “legitimate expectation” arose from a series of promises made by the SoS, dating from 2001 (contained in the Planning Green Paper, an announcement by Lord Falconer in the House of Commons and other subsequent publications) that reasons would be given by the SoS when deciding not to call in planning applications.

The key points are:

  • “legitimate expectation” can arise either through an express promise or by a practice, and either can occur in the planning context;
  • if a public body sets out “a clear and unequivocal policy” an individual is entitled to expect that policy to be operated;
  • such an expectation continues to apply unless and until that policy is modified, withdrawn or otherwise would interfere with statutory duties;
  • the withdrawal or modification of a policy should be done so publicly;
  • no common law duty arises to give reasons for procedural decisions which are not directly determinative of a party’s rights and obligations;

It is notable that whilst LJ Singh accepted that no common law duty arose in the SAVE case, he did not dismiss altogether the possibility that such a duty could still arise in cases of a procedural discretion, stating this “was to be decided in each particular context where the issue may arise in the future“.  This leaves the door open for continued debate as to whether there should be a common law duty to give reasons in planning decisions.

SAVE have presented the case as a victory for transparency.  Their victory may be doubly pyrrhic.  First, the main judgement suggests that the level of reasoning required when declining to call in applications is not great, and that the promise to give reasons can easily be withdrawn.  Secondly, it is already bittersweet since SAVE were denied the right to challenge the underlying Paddington consent – with the Court saying that to do so would have been an “abuse of process”.

A reasoned approach

We look at a local planning authority’s duty to give reasons, in light of recent case.  In September 2016, the Court of Appeal ruled that Dover District Council had failed to give legally adequate reasons for its decision, against the advice of its planning officers, to grant planning permission for a controversial development partly in an area of outstanding natural beauty (AONB) (R (on the application of Campaign to Protect Rural England) v Dover District Council [2016]). This was one of several recent cases which have dealt with, and have generated some uncertainty about, the duty to give reasons.

Read the full article

This article was first published in Property Law Journal (March 2018) and is also available at http://www.lawjournals.co.uk/

Mind the Gap – Letwin Review should take care to avoid policy overload

The Letwin Review is considering why there is a significant gap between the number of planning permissions being granted and the number of homes built.

Initial findings are due to be published with the Chancellor’s Spring Statement 2018 in March (with the final report in the Autumn Budget).  There are a few things to think about before engaging in another orgy of Plan-Shaming and policy overload.

Apples and Pears

There is a need to be careful about how sites are looked at in the first phase of the Review:

  • Treating outline consents as if they are, or should be, immediately implementable is wrong. Outline consents can require significant work to reach detailed approval, let alone readiness for mobilisation and delivery.
  • Care is needed too, on what is treated as ‘delivery’.  Site mobilisation (for example enabling infrastructure) takes time and pre-dates construction of homes.

Defining what delivery and success look like is therefore important to avoid categorising sites that are being invested in – but have not yet yielded homes – as dormant. This will be significant in the context of the emerging Housing Delivery Test, which should be a fundamental part of the Local Plan system.

90% of percentages are wrong…

Various figures are bandied around on how many consents are ‘unimplemented’. Even adopting the higher level figure of 423,000 unimplemented homes with consent:

  • that is a tiny proportion of total supply – roughly 12-14 months of planning approvals
  • it illustrates the need for a deeper stock of permissions to achieve the heroic build out rates the Government is now committed to.

A Local Plan system which made more (and more detailed) site allocations, with clarity about infrastructure requirements, would make a big contribution to closing the gap between in principle approval for development and the detail needed for delivery. Likewise, a Local Plan system that sniffed and snuffed out unrealistic assumptions on delivery rates when trajectories are being examined would help ensure the right number of consents are granted in the first place to create the stock needed.

Diversification

Businesses will generally develop at the rate they are best able to achieve and which reflects the overarching price/demand relationship.  Rather than blaming the private sector for the speed it can – prudently –  build at, it would be more productive to look at how to achieve an increase in direct delivery (or directed delivery) by public bodies which have historically made up at least 100,000 of the gap to the Government’s 300,000 homes per year commitment.

In some cases that will involve more assertive use of land assembly and policy tools in a way that creates greater certainty about land values up front so that builders can build and sell more quickly.

Planning blame-fest?

Evidence from the sector on the non-Planning constraints to delivery is important.  Is there a skills gap, what will Brexit do to it and if Government is sponsoring Brexit how will it sponsor the solution?

From the frontline, a few of the  Planning matters that do slow things down are:

  • Length of time taken to deal with highways works agreements. The absence of a standard template agreement is a real blight on the development process.
    Constant reinvention of the wheel and imposition of poorly drafted and unreasonable requirements does have a real impact on the site mobilisation process. Government could sponsor a standard form and issue guidance recommending its use.
  • The bloat and general time-soak associated with unnecessary use of planning obligations. Our ‘speeding tickets’ blog flagged ways to speed things up without scarce Parliamentary time being needed.

Regulation change to allow LPAs to sell land with benefit of planning permission granted to themselves

From 23 February 2018, an LPA will be able to grant itself planning permission and sell the relevant land with the benefit of that planning permission. This small statutory change has the potential to significantly bolster LPAs’ role in facilitating development and ensuring that it is comprehensively planned.

The Town and Country Planning General (Amendment) (England) 2018 (the Amending Regulations) will remove Regulation 9  from Town and Country Planning General Regulations 1992 (the 1992 Regulations), with the effect that planning permissions granted by LPAs to themselves  will now run with the land.

Currently, Regulation 9 provides that a planning permission (where applied for by an LPA on its own land) will be personal to the LPA and where applied for jointly, only for the benefit of LPA and the named applicant. This has severely impeded the ability of an LPA, having secured planning permission to then sell the land on with the benefit of that planning permission. This has had cost implications requiring more complex land structures to be put in place before applications for development proposals could be made.

Oddly, the Regulations do not apply to any planning permissions granted before 23 February 2018. Given that future consents will run with the land it is strange that past consents have not been similarly “liberated”.

The removal of Regulation 9 was proposed in last year’s Housing White Paper on the basis that it will save time that developers would otherwise spend securing planning permission in relation to land which they purchase from LPAs.

It should achieve this. Now the Government needs to make sure that the best consideration requirements are changed so that land can be sold on for the best use for the area rather than just for the best price.

Deliverability vs Delivery – Court of Appeal confirms NPPF approach

The Court of Appeal has clarified the meaning of ‘deliverable sites’ in the key housing land supply provisions of Paragraph 47 NPPF (5YHLS).  As well as emphasising the need for pragmatism when applying the NPPF, the judgment confirms the need to get timing right if challenges are to be made to the assumed rate of housing delivery.

Supply test in question

In St Modwen v SoS CLG, the developer challenged the housing trajectory put forward by the authority to satisfy the NPPF 47 requirement to show specific deliverable sites sufficient to provide five years worth of housing against objectively assessed need. NPPF Footnote 11 confirms that ‘deliverable’ means available now, offer[ing] a suitable location for development now, and […] achievable with a realistic prospect that housing will be delivered on the site within five years and […] viable.

The Inspector disagreed that sites without permission should be excluded.  She accepted that the rate of consents was likely to increase in light of the draft plan.  She acknowledged a distinction between deliverability and likelihood of delivery: ‘…it may well turn out that not all allocations currently identified as deliverable will in fact be delivered’. The submitted HLS figures were robust, because ‘the assessment of supply is distinct from that for delivery’.

The Secretary of State accepted the Inspector’s finding that there was a 5 year HLS and dismissed the two linked appeals.

Courts insist on common sense

The High Court and the Court of Appeal dismissed the argument raised in seeking judicial review of the decision that the SoS had misunderstood and misapplied the concept of ‘deliverability’.  He should, it was claimed, have considered what would ‘probably be delivered’.

The Court of Appeal disagreed that Ouseley J’s judgment in the High Court suggested that assessment of ‘what probably would be delivered’ is part of, not separate from, the assessment of deliverability.

Ouseley’s judgment – that the assessment of “deliverability” … is an assessment of the likelihood that housing will be delivered. [It] does not require certainty that the housing sites will actually be delivered’ (emphasis added) – simply reflected the distinction between the HLS figure required under the first part of NPPF47 and the ‘expected rate of delivery’ required for the trajectory under the second part.

The Court of Appeal once again went out of its way to criticise ‘unreal’ arguments on the meaning of NPPF policy, holding that:

  • there is a consistent and intentional distinction in the NPPF between ‘deliverability’ and the ‘expected rate of delivery’;
  • deliverability in footnote 11 concern sites’ capability of being delivered – not the certainty/ probability of delivery;
  • the appeal decision was being taken in light of NPPF49, engaging the question of demonstrable 5YHLS, not a question about the ‘the expected rate of housing delivery’.

So what?

The judgment serves to emphasise that:

  • there need only be a ‘realistic prospect’ of delivery for sites to be relied in within the 5YHLS;
  • challenges to the assumptions around the expected rate of delivery generally need to be taken up at the Local Plan examination stage;
  • Local planning authorities do not control the housing market. The NPPF recognises that.’

The last point underlines the fact that LPAs play a critical role, but are only one part of the housing delivery jigsaw. It is also illustrates how important the Housing Delivery Test will be, as a sense check on assumptions and progress, if it is introduced as promised in the Housing White Paper.

What happens to old applications?

The question of what powers LPAs have to deal with old planning applications is raised by both applicants, concerned that their planning application may be unilaterally withdrawn, and LPAs, keen to understand their options for dealing with undetermined applications.

A LPA can decline to deal with an application if: (i) it is not made in the prescribed form; (ii) the circumstances set out in section 70A of the Town and Country Planning Act 1990 (‘TCPA’) apply (namely, the LPA / Secretary of State has refused a similar application in the previous 2 year period and there has been no significant change in the relevant considerations); or (iii) it constitutes an overlapping application under section 70B TCPA.  However, there is no power for an LPA to actually withdraw a planning application.

Instead, an LPA may seek to record the application as “finally disposed of” to avoid the application remaining open indefinitely. What does this mean?  What is the effect?

“Finally disposed of”

The term “finally disposed of” is used in article 40 of the General Development Procedure Order 2015 (‘GDPO’).  Under article 40(2) GDPO, each local planning register authority must keep a register of every live application for planning permission relating to their area.

Article 40(13) GDPO sets out the circumstances in which an application can be treated as finally disposed of.  In summary, this is where an application has been:

  1. granted or refused by the LPA  and the time limit for appealing has expired without appeal;
  2. referred / appealed to the Secretary of State, who has issued a decision and any application to the High Court has been finally determined;
  3. withdrawn before being decided by the LPA / Secretary of State or an appeal has been withdrawn before the Secretary of State has issued a decision; or
  4. finally, the period for determination and appeal has expired no decision has been made.  This means that a LPA can simply record an application as finally disposed of as soon as the period for determination and appeal has expired – so watch for that date.

Once any of these requirements are satisfied, the LPA may treat the application as finally disposed of and elect to remove the application from its Planning Register.

Best Practice for applicants

To avoid an application being finally disposed of, applicants should either: (i) agree to extend the time period for the Council to determine the application; or (ii) if the LPA fails to determine the application within the statutory period, appeal on the grounds of non-determination. Applicants should note that if the application period is extended, the right to a refund is lost, even if the authority fails to meet the extended deadline.

Best Practice for LPAs

Once the date for determination has passed, consideration should be given at regular intervals to whether the application should be deemed “finally disposed of” and removed from the Planning Register. Given the cost and expense of submitting an application an LPA should notify the applicant of its intention to treat an application as “finally disposed of” before doing so.  This should set out a timetable for dealing with any outstanding matters.

Refusal as an Alternative

Rather than recording an application as “finally disposed of”, LPAs could simply refuse the application. However, LPAs are often  keen to avoid this course of action for 2 reasons:

  1. Refusal rates are monitored nationally and, in theory, LPAs with clear policies and effective pre-application advice should issue fewer refusals.  LPAs may therefore be concerned that refusing such application will have a negative impact on their performance figures; and
  2. It would reinstate an applicant’s right to appeal.
  3. Given the above, it is likely that LPAs will continue to treat applications as “finally disposed of” unless a formal procedure for LPAs to withdraw planning applications is implemented.  This is unlikely to be high on the agenda at any time in the near future given the raft of more pressing planning matters.

More planning protection for pubs

In 2015, the Government removed permitted development rights from pubs listed as Assets of Community Value (ACVs).  As previously reported, pubs which are listed as ACVs, or have been nominated to become ACVs, require planning permission for changes of use or demolition, which otherwise could be carried out under permitted development rights.

Noting the importance of pubs to local communities, some local authorities have made Article 4 Directions to remove permitted development rights from pubs. The London Borough of Wandsworth made an Article 4 Direction in August 2016 removing specified permitted development rights for changes of use, demolition and alteration for 120 identified pubs and bars.

Following Wandsworth’s lead, the London Borough of Southwark introduced an Article 4 Direction removing permitted development rights from all 188 pubs in Southwark in March 2017.  The Article 4 Direction means that planning permission will need to be obtained for specified changes of use, demolition, demolition or construction of gates, fences and walls, and exterior painting.

After discussions in Parliament in connection with the then Neighbourhood Planning Bill, the protection afforded has been further extended by the Government to cover all pubs rather than just those listed as ACVs. Section 15 of the Neighbourhood Planning Act obliges the Secretary of State to as soon as reasonably practicable make an order to remove permitted development rights for changes of use and demolition of pubs, and to grant permission for pubs to change to pub and café/restaurant use.  This requirement has been met by the making of the Town and Country Planning (General Permitted Development) (England) (Amendment) (No 2) Order 2017, which comes into force on 23 May 2017.

The order removes permitted development rights so in most cases pubs will instead have to apply for planning permission to:

  • change to a shop;
  • change to a restaurant or café;
  • change to a state funded school;
  • change to a temporary flexible use; or
  • to be demolished.

The order includes a new permitted development right, to allow pubs to change use to “drinking establishments with expanded food provision” and vice versa without planning permission.

The order demonstrates the importance of pubs to the Government, by requiring a planning application for a change of use other than to a pub restaurant.  While this change negates the need for communities to list their local as an ACV to prevent changes of use without planning permission, listing could still be pursued.  A local planning authority can consider ACV status as a material consideration on a planning application, and so ACV listing could be an extra factor the local planning authority has to take into account when considering an application to change the use of a pub.  This then offers an extra layer of protection for communities wanting to keep venues operating as pubs.