The High Court’s decision in Westminster City Council v Secretary of State for Communities and Local Government and another  EWHC 690 (Admin) (the WCC Case) was as a reminder that it is not enough to label something a planning obligation – it must still (1) satisfy the test in section 106(1) of the TCPA to run with the land and bind future owners and occupiers and (2) be properly drafted.
In the WCC case it was found that an obligation which sought to prevent occupiers of a new residential development from applying for parking permits did not satisfy the test in section 106(1) because the obligation did not:
- restrict the development or use of the land in a specified way;
- require specified operations or activities to be carried out on the land; or
- require the land to be used in a specified way.
The WCC case was applied by an Inspector in an appeal decision (17 February 2014) concerning development at 6 St Catherine’s Mews, London and London Boroughs have been quick to take note, with changes being made to their section 106 agreements to address this issue. It is now almost standard practice for section 106 agreements to make reference to section 16 of the Greater London Council (General Powers) Act 1974, in addition to the ordinary covenant that a developer is not to make or permit owner and occupiers from applying for parking permits. The reference to section 16 is a sensible safeguard by local authorities in the event that the ordinary covenant is tested against section 106(1) of the 1990 Act and found only to be a personal undertaking by the developer – not enforceable on future owners and occupiers.
It is worth noting that the High Court (in the WCC Case) did not go so far as to state that there was no way in which an obligation not to apply for parking permits could meet the requirements of s106(1). In fact, the following wording was said to have, theoretically, passed the test: “The Owner hereby covenants that the Property shall not be occupied for so long as the Owner or occupier of the Property has made an application to X Authority for a parking permit which has not been decided or is in possession of such a parking permit“. However, we agree with the Judge’s obiter comments and warn that authorities should stay away from such language as a planning obligation of this kind would be extraordinarily difficult, politically, to enforce. What authority (in their right mind) would seek to turn out an occupier if an application was made for a parking permit in connection with their dwelling?
The reality is that in the areas where restrictions are needed, car parking policies are already in place. They are controlled by local authorities. All that the planning agreement does is to act as a public acknowledgement and signal that the authority will not grant permits to occupants of the building. Rather than trying to buttress the clauses surely local planning authorities would be better just to accept that the provisions are declaratory and leave it at that.