Month: April 2018

Pointers From Parkhurst?

Parkhurst Road Limited v Secretary of State (Holgate J, 27 April 2018) is a complex analysis by the High Court of issues relating to viability appraisal. Indeed Holgate J concludes an unusual postscript (paragraph 142 onwards) to his judgment by expressing the hope that “the court is not asked in future to look at detailed valuation material as happened in these proceedings“.

The Parkhurst Road dispute has indeed been protracted, to say the least.

Parkhurst Road Limited had purchased the site in May 2013 for £13.25m from the Ministry of Defence, the site having been allocated by Islington Council as a “site for intensification for residential accommodation to help meet housing need in the Borough“.

An initial development proposal for 150 homes, reduced to 116 homes, was refused by Islington in October 2014 and an appeal was dismissed on design grounds in September 2015 following a six day inquiry. There had been dispute about viability issues at that inquiry but the inspector had been satisfied with the appellant’s benchmark land value position of £13.26m, which would have led to a 14% affordable housing commitment (16 homes). He considered that market comparables relied on by PRL showed that the price paid by PRL for the site “was not of a level significantly above a market norm“. Islington had not accepted the inspector’s approach to viability (pointing to a circularity inherent in relying on market evidence of comparable transactions to the extent it may not have been adjusted to reflect the requirements of relevant planning policies) but had not challenged it, given that the appeal had been dismissed in any event.

A revised scheme was then brought forward in January 2016, for 96 homes, with the design issues resolved, but with no affordable homes, on the basis that the viability of the scheme could no justify it. Again the application was refused, effectively solely on viability grounds, due to an asserted failure to maximise provision of affordable housing as against the council’s borough wide strategic target of 50%. PRL again appealed and by the time the inquiry closed in March 2017 after nine sitting days, the position was that PRL were arguing for a reduced benchmark land value of £11.9m and proposing that 10% of the homes should be affordable housing. Islington was arguing for a benchmark land value of £6.75m, leaving headroom for 34% affordable housing. The council’s case was based on an approach of relying on a low existing use value with a premium added (EUV+). PRL’s case was based on using market signals from other transactions, disregarding transactions “which are significantly above the market norm“.

Holgate J was told “that the two decision letters on the Parkhurst Road site have generated a good deal of interest amongst planning professionals, as if either decision could be taken as laying down guidance of more general application on the approach to be followed where development viability and affordable housing contributions are in issue.”

He throws cold water on that suggestion:

“It is important to emphasise that that is not normally the function of a decision letter. The Inspector’s task is to resolve the issues which have been raised on the evidence produced in that appeal. The Inspector is not giving guidance on what course should generally be followed, even in cases raising the same type of issue. First, the application of policy often involves a good deal of judgment and second, the circumstances of an appeal (and the evidence produced) may differ quite considerably from one case to another (see eg. St Albans DC v Secretary of State for Communities and Local Government [2015] EWHC 655 (Admin)). There is a risk of attaching too much importance to the decisions of individual Inspectors, particularly where their conclusions were heavily dependent upon the circumstances of the cases before them and the nature of the evidence and submissions they received, with all their attendant strengths and weaknesses specific to that appeal. Reliance upon such decisions may take up a disproportionate amount of time and may distract parties from preparing suitable and sufficient information to deal with the circumstances and issues which arise in their own case.”

I summarised the inspector’s decision letter dismissing the appeal in my 24 June 2017 blog post Viability & Affordable Housing: Update.

The appellant challenged the decision on three grounds:

Ground 1 – the inspector erred in concluding that the council’s case was based on the EUV plus approach.

Ground 2 – the inspector did not address flaws which had been shown in the council’s valuer’s approach, applied the consultant’s method in a manner which was inconsistent with his understanding of it and failed to recognise substantial changes in the council’s case by the time the end of the inquiry was reached.

Ground 3 – criticisms of the way in which the inspector treated certain comparable transactions when arriving at his decision to accept the council’s benchmark land value figure.

Holgate J is not a judge to be cowed by disputes involving matters of valuation. He is after all President of the Lands Chamber in the Upper Tribunal and Planning Liaison Judge (ie basically the lead Planning Court judge).

He summarises Government policy on viability, quoting from paragraph 173 of the NPPF (with an interesting reference to compulsory purchase compensation principles when referring to the concept of a “willing seller”) and paragraphs 1, 19, 23 and 24 of the viability section of the Government’s planning practice guidance, asserts that the guidance places the onus on the developer to demonstrate non-viability, before summarising relevant local policies.

He addresses the RICS professional guidance, “Financial Viability In Planning“, in paragraphs 50 to 58, without criticism – noting for instance the fact that the guidance note discourages reliance upon EUV+ “as the sole basis for arriving at site value, because the uplift is an arbitrary number and the method does not reflect the workings of the market. Furthermore, the EUV Plus method is not based upon the value of the land if the redevelopment involves a different land use (eg. an office building redeveloped for a residential scheme)”.

The Secretary of State and Islington resisted the grounds but submitted that, in any event, PRL’s criticisms “do not vitiate the essential conclusion of the inspector that, contrary to local policy, the appeal proposal failed to provide “the maximum reasonable amount of affordable housing“”.

After a lengthy analysis of the decision letter as well as the arguments that had been put forward by the parties, the judge rejected grounds 1 and 3. He accepted in part PRL’s arguments in relation to ground 2, there had indeed been flaws in the council’s valuer’s approach which were not addressed properly by the inspector. However that error, in the judge’s view, did not vitiate the basis upon which the inspector rejected PRL’s case that a 10% affordable housing provision represented the maximum reasonable level and was not therefore a basis for quashing the decision.

The claim was accordingly dismissed.

Which takes us to that postscript in paragraphs 141 to 147. It is an intriguing read for what is says about, for instance the following:

⁃ The importance of overcoming uncertainty as to how viability assessment should properly be carried out, which is “making it difficult for practitioners and participants in the planning process to predict the likely outcome and to plan accordingly. It also leads to a proliferation of litigation“.

⁃ The tension that has arisen in the application of paragraph 23 of the viability passages in the PPG, which should mean reflecting and not bucking relevant planning policies when arriving at a benchmark land value, but on the other hand ensuring that the application of those policies should be informed by and not bucking an analysis of market evidence.

⁃ Data on comparables should be adjusted properly but on the other hand there are drawbacks in a simple requirement to conform to EUV+, by way of formulaic application, especially via local authority documents which have not been subjected to independent statutory examination prior to adoption.

Finally, in the context of the Government’s consultation proposals in relation to standardised inputs to viability assessments (see my 10 March 2018 blog post Developer Contributions, CIL, Viability: Are We Nearly There Yet the judge offers a suggestion:

“It might be thought that an opportune moment has arrived for the RICS to consider revisiting the 2012 Guidance Note, perhaps in conjunction with MHCLG and the RTPI, in order to address any misunderstandings about market valuation concepts and techniques, the “circularity” issue and any other problems encountered in practice over the last 6 years, so as to help avoid protracted disputes of the kind we have seen in the present case and achieve more efficient decision-making.”

That would indeed be welcome.

Simon Ricketts, 28 April 2018

Personal views, et cetera

[Colleagues at Town acted for PRL but these are, as always, my personal views].

EU Court Ruling: Ignore Mitigation Measures In Habitats Screening

POW, indeed. The People Over Wind ruling (Court of Justice of the EU, 12 April 2018) is short but striking.

The issue is an important one. There are two steps that a decision maker must follow in determining whether a plan or project is likely to affect a Special Area of Conservation under the Habitats Directive or a Special Protection Area under the Birds Directive (given domestic effect by the Conservation of Habitats and Species Regulations 2017).

The first step is what is commonly called “screening”, although it is not a formal procedural process as there is with EIA. At this stage the question is whether the plan or project is likely to have a significant effect on an SAC or SPA (either alone or in combination with other plans or projects). “Likelihood” is a low threshold – as summarised in People Over Wind:

“In the light, in particular, of the precautionary principle, such a risk exists if it cannot be excluded on the basis of objective information that the plan or project will have a significant effect on the site concerned“.

If the risk of a significant effect can be excluded at this stage, no further work is required under the Birds or Habitats Directive.

If the risk of a significant effect cannot be excluded, “appropriate assessment” is required to determine that the plan or project will not adversely affect the integrity of the SAC or SPA. If the answer at this stage is other than that it will not, the plan or project is in problems as there are only limited circumstances which would then allow it still to proceed.

Screening out the need for appropriate assessment is important to promoters of plans and projects:

⁃ it reduces the amount of work, time and cost spent, particularly in relation to smaller schemes if the screening stage can be relatively standardised for similar types of development (for instance residential developments in the vicinity of SPAs such as the Thames Basin Heaths).

⁃ paragraph 119 of the NPPF provides that the “presumption in favour of sustainable development (paragraph 14) does not apply where development requiring appropriate assessment under the Birds or Habitats Directives is being considered, planned or determined.” (This is carried over into paragraph 174 of the draft revised NPPF).

The English courts have long taken the position that proposed mitigation measures can be taken into account at the screening stage. Indeed Sullivan J’s ruling almost exactly ten years ago in R (on the application of Hart District Council) v Secretary of State for Communities and Local Government (Sullivan J, 1 May 2008) was crucial in establishing the practicality of local authorities relying on the funding or provision of Suitable Alternative Natural Greenspace (SANGS) rather than requiring appropriate assessment in relation to each housing project that might lead to an increase in people wishing to use the nearby SPA for recreational purposes. He held that there was no reason why a commitment to provide mitigation in the form of SANGs could not be taken into account at screening stage:

“…if the competent authority is satisfied at the screening stage that the proponents of a project have fully recognised, assessed and reported the effects, and have incorporated appropriate mitigation measures into the project, there is no reason why they should ignore such measures when deciding whether an appropriate assessment is necessary. Under Regulation 48(2), the competent authority may ask the proponent of a plan or project for more information about the plan or project, including any proposed mitigation, not merely for the purposes of carrying out an appropriate assessment, but also in order to determine whether an appropriate assessment is required in the first place. If for any reason the competent authority is still not satisfied, then it will require an appropriate assessment. As a matter of common sense, anything which encourages the proponents of plans and projects to incorporate mitigation measures at the earliest possible stage in the evolution of their plan or project is surely to be encouraged“.

That has remained the domestic law, as can be seen in R (Champion) v North Norfolk District Council (Supreme Court, 22 July 2015), where the reason why the permission was quashed was that at the screening stage the mitigation measures relied upon had not been fully identified.

However, the European Court of Justice has now driven somewhat of a bulldozer through this approach in its ruling this month in relation to a reference from the Irish High Court in relation to proceedings which had been brought by the People Over Wind campaign group and campaigner Peter Sweetman (not his first visit to the Luxembourg court, see Sweetman v. An Bord Pleanala (CJEU, 11 April 2013)) to seek to quash permission for a project to lay a cable connecting a wind farm to the electricity grid, potentially affecting rivers constituting a habitat for the “Nore pearl mussel”. According to the judgment, the consultants’ screening report for the project concluded as follows:

“a)      In the absence of protective measures, there is potential for the release of suspended solids into waterbodies along the proposed route, including directional drilling locations

b)      With regards to [the Nore pearl mussel], if the construction of the proposed cable works was to result in the release of silt or pollutants such as concrete into the pearl mussel population area of river through the pathway of smaller streams or rivers, there would be a negative impact on the pearl mussel population. Sedimentation of gravels can prevent sufficient water flow through the gravels, starving juvenile [Nore pearl mussels] of oxygen.’

18      It is apparent from the file before the Court that ‘protective measures’ were also analysed by that report.

19      Subsequently, on the basis of that report, the following recommendation was drawn up for Coillte by the ‘programme manager’:

As set out in detail in the … appropriate assessment screening report, on the basis of the findings of that report and in light of the best scientific knowledge, the grid connection works will not have a significant effect on the relevant European sites in light of the conservation objectives of the European sites, alone or in combination with the Cullenagh wind farm and other plans or projects, and an appropriate assessment is not required. This conclusion was reached on the basis of the distance between the proposed Cullenagh grid connection and the European sites, and the protective measures that have been built into the works design of the project.’”

The Irish High Court referred the following question to the European Court of Justice for a preliminary ruling:

“Whether, or in what circumstances, mitigation measures can be considered when carrying out screening for appropriate assessment under Article 6(3) of the Habitats Directive?’”

Even for the CJEU the resulting judgment is brief.

“…it is settled case-law that Article 6(3) of the Habitats Directive makes the requirement for an appropriate assessment of the implications of a plan or project conditional on there being a probability or a risk that the plan or project in question will have a significant effect on the site concerned. In the light, in particular, of the precautionary principle, such a risk exists if it cannot be excluded on the basis of objective information that the plan or project will have a significant effect on the site concerned (judgment of 26 May 2011, Commission v Belgium, C‑538/09, EU:C:2011:349, paragraph 39 and the case-law cited). The assessment of that risk must be made in the light inter alia of the characteristics and specific environmental conditions of the site concerned by such a plan or project (see, to that effect, judgment of 21 July 2016, Orleans and Others, C‑387/15 and C‑388/15, EU:C:2016:583, paragraph 45 and the case-law cited).”

“35      As the applicants in the main proceedings and the Commission submit, the fact that, as the referring court has observed, measures intended to avoid or reduce the harmful effects of a plan or project on the site concerned are taken into consideration when determining whether it is necessary to carry out an appropriate assessment presupposes that it is likely that the site is affected significantly and that, consequently, such an assessment should be carried out.

36      That conclusion is supported by the fact that a full and precise analysis of the measures capable of avoiding or reducing any significant effects on the site concerned must be carried out not at the screening stage, but specifically at the stage of the appropriate assessment.

37      Taking account of such measures at the screening stage would be liable to compromise the practical effect of the Habitats Directive in general, and the assessment stage in particular, as the latter stage would be deprived of its purpose and there would be a risk of circumvention of that stage, which constitutes, however, an essential safeguard provided for by the directive.

38      In that regard, the Court’s case-law emphasises the fact that the assessment carried out under Article 6(3) of the Habitats Directive may not have lacunae and must contain complete, precise and definitive findings and conclusions capable of removing all reasonable scientific doubt as to the effects of the proposed works on the protected site concerned (judgment of 21 July 2016, Orleans and Others, C‑387/15 and C‑388/15, EU:C:2016:583, paragraph 50 and the case-law cited).”

It is a frustrating judgment. There are so many unasked and unanswered questions arising from it, for instance:

1. Why does reference to mitigation measures presuppose that without the measures there is likely to be a significant effect?

2. Why is it assumed that there can be no certainty as to the effectiveness of proposed mitigation measures?

3. Why is there no dividing line between mitigation on the one hand and avoidance/reduction on the other (a distinction raised by Sullivan J in Hart, where he didn’t necessarily accept that the SANGs mechanism amounted to mitigation as opposed to avoiding effects in the first place) and where is the dividing line between mitigation and components of the project itself? If an inherent part of the project (say soundproof walls) also serves a mitigation function, surely it is not to be ignored. In which case, what is included in the project and what is mitigation that is not an integral or inherent part of the project is a crucial question.

It is going to be interesting to see how UK practice adapts in relation to the ruling and how soon the issue comes before the courts. Will attempts be made to distinguish it (that is possible) or will plan and project promoters take a more cautious approach of proceeding more frequently to appropriate assessment? Will this be the sort of issue where, post- Brexit, the domestic courts will begin to take an increasingly differing stance to Luxembourg?

There is a potentially wider question, as to whether the same “ignore mitigation” principle will begin to infect the EIA process where, again, the relevance of proposed mitigation measures at screening stage has long been accepted (see eg Gillespie v Secretary of State for Transport Local Government and the Regions(Court of Appeal, 27 March 2003)).

There is no reference to the EIA Directive in People Over Wind but it will be one to watch. It would be quite a step, given that the EIA Regulations specifically require that a negative screening opinion or direction should “state any features of the proposed development and measures envisaged to avoid, or prevent what might otherwise have been significant adverse effects on the environment“!

Lastly, on the subject of screening under the Habitats and Birds Directives, R (Mynnydd y Gwynt Limited) v Secretary of State (Court of Appeal, 22 February 2018) is another recent case worth reading, which demonstrates the difficulties of challenging any decision by a competent authority that appropriate assessment is required. The claimant, promoting a wind farm by way of a DCO, was perhaps entitled to feel rather sore. National Resources Wales had first taken the view that appropriate assessment was not required but then changed its position, saying that more information was required. The examiner was on balance satisfied but in the light of NRW’s concerns advised the Secretary of State that she might decide that an appropriate assessment was necessary, which indeed in due course she did. Back to the drawing board.

The Secretary of State’s determination was challenged, alleging that she had erred by:

“1)  Requiring certainty in relation to each element of the data, instead of using the available information and making a reasoned judgement, always taking the precautionary approach.

2)  Reaching an inconsistent conclusion about the in-combination level of risk to the red kite population in this SPA to those reached in relation to other Mid-Wales windfarm proposals.

3)  Not referencing or showing that she had considered the Appellant’s December 2014 response to NRW’s concerns about survey methodology”

The court rejected the challenge:

“For this appeal to succeed, it must be shown that the judge was wrong not to have concluded that the Secretary of State’s decision was unlawful on Wednesbury principles – that she had taken account of irrelevant matters or failed to take account of relevant matters, or that her decision was so unreasonable that no reasonable authority could have made it.

For my part, I am not persuaded that the Secretary of State’s decision was unlawful, nor that the judge’s careful review of the decision was wrong. The Secretary of State was required to exercise a judgement at the junction between two important social objectives – renewable energy and species protection. She was faced with a conflict of views between her statutory conservation adviser and her examiner. She asked for further assistance: NRW responded, the Appellant did not. I accept that the Secretary of State might have been persuaded by the arguments that found favour with the examiner, but in the overall circumstances I consider that she was entitled to accept the advice of NRW and conclude that she did not have the information necessary to enable her to grant the application.”

Whilst it may be frustrating for clients and professional teams alike, these cases demonstrate the care that needs to go into the promotion strategy for any scheme (including the definition of the project itself) where there is a potential impact on an SAC or SPA, and the importance of resolving matters with the relevant conservation bodies – as well as the degree of scientific work required, which often feels like an endless search to prove a negative which may ultimately be unprovable. Mitigation or not, life isn’t as certain as the legislation requires it to be.

I just wish I understood the rationale for that People Over Wind ruling. If you do I would be delighted to hear it.

Simon Ricketts, 20 April 2018

Personal views, et cetera

Telephone Kiosks vs Homes

“Does the flap of a butterfly’s wings in Brazil set off a tornado in Texas?” (Edward Lorenz)

Congratulations to Trudi Elliott for her well-deserved appointment as independent chair of the Planning Inspectorate’s board of directors on 1 April 2018. She is uniquely qualified for the role and it is such a crucial time for the Planning Inspectorate.

As far as I’m concerned PINS has been one of the country’s most impressive bodies, truly independent in its decision-making, rigorous and non partisan in its approach and in recent years increasingly open as to the targets it is working to and the challenges it faces. Sarah Richards appears to be a competent chief executive and in the best traditions of the organisation.

However, I am worried that all is not well. Current average performance timescales for appeals by way of written representations, informal hearings and inquiries are reported to be as follows, as at 20 March 2018:

– written representations are taking 24 weeks overall (with the first ten weeks being to start date)

– hearings are taking 36 weeks overall (with the first 17 weeks being to start date)

– inquiries are taking 49 weeks overall (with the first five weeks being to start date).

Whilst the numbers do not appear to be worsening materially over the last year or so, they are certainly not materially improving, at a time when you would think that the Government should be pulling every lever. Furthermore the most frustrating delays are between validation of the appeal and receipt of the ‘start date’ letter, which sets the procedural deadlines for the appeal process itself. Until the start date, you’re just sitting in the in-tray.

Whilst individual experiences are inevitably anecdotal, we are acting on one appeal, in relation to a scheme for around 70 apartments (refused by members against the officers’ recommendation), where an appeal was submitted on 14 December 2017, with the written representations appeal procedure requested, validated on 9 January and yet still no start date.

Not quite the flap of a butterfly’s wing, but I posted a frustrated tweet on 20 March commenting on the delay.

Various people responded to the tweet with their own similar recent experiences, which led Mark Wilding to write a good piece in Planning magazine on 28 March Why new inspectorate data substantiates complaints about lengthening appeal delay. That in turn for instance led to a former inspector writing to the magazine with his own speculation as to the reasons for the current problems.

After the Mark Wilding piece, I wrote on 3 April to Sarah Richards to provide more details about the particular appeal in case something could be done to unlock the continuing delay in obtaining a start date. Sarah responded very quickly on 6 April. She made clear that of course she could not intervene in the particular appeal but she took the opportunity to set out the challenges which PINS is currently facing. As she said in her response that she would do, she adapted the response into an open letter to Planning magazine which it published online on 12 April.

One particular passage in her letter was news to me:

“The demand on our resources has been compounded by the unexpected receipt of more than 1,000 prior approval appeals for phone kiosks, and that number is likely to increase. Currently these have been absorbed into our normal planning appeal work, with consequent delays. We are now adopting a different model to process these appeals which will use our non-salaried inspectors, and this should release capacity back to mainstream work. This will have a positive impact on the overall time taken to determine appeals over the coming months.”

So one of the reasons that there are currently delays in the processing of appeals for housing and no doubt other forms of development is a deluge of prior approval appeals for phone kiosks??

Who uses a phone kiosk any more, I naively thought. Well of course advertising companies do, for a start.

I did a little digging and I now see that there is this huge drain on the resources of local planning authorities as well as PINS caused by somewhat of a gold rush.

The Local Government Association raised a concern earlier this year, LGA: call for crackdown on ‘trojan’ telephone boxes amid 900 per cent rise in some areas (27 January 2018).

Councils have been under sustained attack for some time from a variety of, usually pretty anonymous, companies, each with a licence to operate under the electronic communications code, each seeking approval for the erection of a large number of new style telephone kiosks. The main companies include such household names (not) as Maximus Networks Limited, Infocus Public Networks Limited, Euro Payphone Limited and New World Payphones.

Electronic communications code operators benefit from deemed planning permission for the installation of their telephone kiosks under Schedule 2, Part 16, Class A of the Town and Country Planning (General Permitted Development) Order 2015, subject to prior approval by the local planning authority of siting and appearance. Need, or the lack of it, is irrelevant (see for example a decision letter dated 14 November 2017 relating to an appeal in Hackney by Euro Payphone Limited).

Operators then have deemed consent under the Advertisement Regulations for non-illuminated advertisements on the kiosks, but often apply for express consent for illuminated advertisements (see for example a decision letter dated 12 January 2018 in relation to an appeal in Eltham by New World Payphones).

Councils often understandably seek to resist these proposals but it is clearly difficult. The BBC reported last June Westminster City Council’s rejection of 80 proposals by Maximus Networks Limited as well as proposals by other companies:

Councils block ‘ugly and unwanted advert space’ phone boxes.

Whilst the issue has raised concern in local areas and provoked comment, I have not tracked down any recent Parliamentary debate when plainly something is not quite right is it?

This from the ChiswickW4 website about Infocus Public Networks Limited (I haven’t verified its accuracy):

“The phone boxes, which are wheelchair accessible, have been rejected by a number of local authorities, and critics say their primary purpose is for the display of advertising rather than making phone calls.

The Warwickshire-based company, Infocus Public Networks Ltd, applied for ‘prior approval’ to site the phone boxes on the pavement at 120, 96, 135 Chiswick High Road (outside Insider Dealings Interior Design , Sainsbury Local, and the former Ballet Rambert) .

Local authorities, including Hammersmith & Fulham, Kensington & Chelsea, and Westminster have all said ‘No’ to the kiosks on grounds of siting and appearance – the only grounds on which a local authority can refuse ‘prior approval’. Councils are not allowed to consider any advertising benefits which may accrue from the phone boxes as they are already the beneficiaries of ‘deemed consent’ from the regulatory body Ofcom.

Infocus, which describes itself as the UK’s third public payphone operator, has challenged a number of local authorities for refusing to allow the phone boxes in their area. An attempt by the company to install fifteen phone boxes in Swindon, which was turned down by Wiltshire council, was partly overturned by the Planning Inspector who ruled that nine phone boxes could be sited in the town streets.

The payphone kiosks use mobile telephony for connection to other networks and the company says there are no invasive pavement works involved. They say the large windows deter the use of the kiosks for antisocial and criminal activity, and that there is still a need for public payphones for tourists, and ethnic minorities and those in wheelchairs.

The old-style kiosks are not allowed to be installed because they do not comply with disability regulations from Ofcom. BT has also removed hundreds of kiosks from UK streets due to the growth of mobile phone use.

Wiltshire Council has asked the government to give local authorities greater powers over the control of advertising on public payphones, following the Inspector’s reversal of its decision, according to the Swindon Advertiser. The City of London also lost its attempt, on appeal, to prevent seven similar boxes in the Lambeth area.

Critics of the scheme say the phone boxes are a lucrative method of attracting commercial advertising to the company which installs them, and are not of any public benefit to disabled users as they take up more pavement surface than traditional kiosks and add to ‘street clutter’. ”

Incidentally Infocus has possibly the world’s least informative website.

These kiosks are prime advertising space as is clear from Clearchannel’s website.

Do these payphones serve a legitimate function? If they aren’t “for the purpose of the operator’s electronic communications network” the permitted development right doesn’t apply in the first place.And what of some data privacy concerns (according to a piece in Wired, Stop replacing London’s phone boxes with corporate surveillance which might be considered alarmist if we weren’t currently highly sensitised by the Facebook data mining scandal)? Doesn’t the Government need to form a view and quickly? In the meantime these applications and appeals (1,000 appeals!) risk jamming up the system, quite apart from unnecessarily cluttering our streets. Of course PINS needs to do what it can to avoid the problem contaminating its mainstream caseload but why should it be forced to employ external consultants, at taxpayer cost? If ever there were a case for appeal fees!

One of the roles of the PINS board is “ensuring the Planning Inspectorate delivers against its strategic objectives and ensuring sufficient resources are available to achieve those objectives”. A brief scroll through previous minutes of its meetings will demonstrate the level of scrutiny given to every aspect of its performance, although no reference yet to these wretched kiosk appeals! Trudi, you have a crucial role to play in ensuring that resources are correctly prioritised.

Simon Ricketts, 14 April 2018

Personal views, et cetera

Fawlty Powers: When Is A Permission Safe From Judicial Review?

A case last month arising from a howler of a permission for the erection of three marquees in the grounds of a hotel, a permission that was intended to be temporary but was issued without any condition to that effect, has potentially created a real mess. 
Pretty much the main thing that the commercial and financial world always wants from any consenting or licensing system, and certainly the planning system, is certainty as to when any necessary consent or licence, such as a planning permission, is free from legal challenge. Central to the legal due diligence work in relation to any operational business with a bricks and mortar presence, for instance in connection with its financing or acquisition, and certainly in relation to any property or development financing or acquisition, will be the need to report on the operative planning permissions and whether they are now beyond risk of being quashed by the courts. Once the judicial review period has passed, it is assumed that a permission can safely be relied upon, money can be lent or invested, properties or companies can be acquired. If the judicial review period has not yet expired, transactions will often be made conditional on its expiry without proceedings having been commenced. 

Judicial review periods are deliberately short so that we can all safely rely on public bodies’ decisions after a relatively short period. Compared with the six or twelve years’ limitation periods that are common in private law, the traditional principle in relation to judicial review is that proceedings must be brought promptly and in any event not later than three months after the grounds upon which the claim is based first arose (Civil Procedure Rules Part 54.4). 

In our planning world, time limits are usually even tighter:
– In relation to statutory challenges, for instance under section 288 of the Town and Country Planning Act 1990 for challenges of decisions of the Secretary of State and his inspectors on planning appeals and called-in planning applications, or under section 113 of the Planning and Compulsory Purchase Act 2004 for challenges of adopted development plans, the relevant time limit is six weeks. 
– Since 2013, the deadline for bringing judicial review proceedings in relation to other matters arising under the Planning Acts (care needed over that definition) is six weeks. 

But it isn’t quite as easy as assuming that, if these deadlines have passed, the relevant decision is free from any risk of judicial review. CPR rule 3.1 (2) (a) gives judges some discretion. Except where the rules provide otherwise, the court may “extend or shorten the time for compliance with any rule, practice direction or court order (even if an application for extension is made after the time for compliance has expired)“. 
A separate form needs to be submitted with the claim, asking for a time extension and explaining why it is justified. The Administrative Court Judicial Review Guide states:
“The Court will require evidence explaining the delay. The Court will only extend time if an adequate explanation is given for the delay, and if the Court is satisfied that an extension of time will not cause substantial hardship or prejudice to the defendant or any other party, and that an extension of time will not be detrimental to good administration.”
The Court of Appeal last year in Connors and others v Secretary of State (17 November 2017) stressed the extent to which the onus is on the claimant to justify being allowed to bring a claim out of time and waiting to learn the outcome of another case was not a sufficient ground:
“In the context of planning decision-making, this court has made it very clear that the exercise of judicial discretion to permit very late challenges to proceed by way of claims for judicial review will rarely be appropriate – regardless of whether the claimant has had available to him and acted upon legal advice (see the judgment of Sales L.J., with whom Lord Dyson M.R. and Tomlinson L.J. agreed, in R. (on the application of Gerber) v Wiltshire Council [2016] 1 W.L.R. 2593, at paragraphs 45 to 58).”
R (Gerber) v (1) Wiltshire Council (Court of Appeal, 23 February 2016) was a case I mentioned in my 24 March 2018 blog post Once More Unto The Breach Of Legitimate Expectation, Dear Friends. The claimant sought to challenge a planning permission for a solar farm project over a year after the permission had been issued. At first instance, Dove J had been persuaded to allow the claim, accepting that the delay was justified first because there had been a breach of legitimate expectation, established by the council’s statement of community involvement, that he would be consulted at application stage about the proposal and so had an excuse for not knowing about the permission being granted and secondly that part of the delay had been caused by a first firm of solicitors having given ‘incomplete’ advice as to his potential remedies. The parties all accepted that there were in fact errors with the permission which made it unlawful. 

The Court of Appeal rejected on the facts the SCI breach of legitimate expectation argument and thought that the abortive approach to the first firm of solicitors was not a sufficient excuse for the delay. Refusing to allow the claim to be brought out of time it took on board took into account that “substantial hardship or prejudice” would be caused to the solar farm operator, which in the meantime had built its facility:
“On 23 July 2014 Terraform completed an Initial Public Offering on the NASDAQ Global Select Market based on a prospectus listing Norrington as a project generating cash flow in the United Kingdom. Terraform and Norrington make the point in these proceedings that if the planning permission is quashed, that will harm the ability of companies seeking to invest in green energy generation in the United Kingdom to attract investors to fund such projects, because of the uncertainty whether they will be able to rely on planning permissions granted by planning authorities to carry out such developments even though they have gone without challenge within the time provided for in CPR Part 54.5 and indeed, as in this case, for a considerably longer period.”

“The evidence for Norrington and Terraform, the substance of which was accepted by the judge, is that if the planning permission is quashed and they are required to dismantle the solar farm, the cost of dismantling it and restoring the Site to agricultural use would be around £1.5 million. In addition, the cost of installing the solar farm of about £10.5 million would have been wasted and lost. In addition, a premium of £2000 paid for an option to take the lease and locked-in rental payments of approximately £36,300 under the lease would also be wasted.”
Sales LJ  concluded: 

“In my judgment, where proper notice of an application for planning permission has been given pursuant to the 2010 Order it is not appropriate to extend time for bringing a legal challenge to the grant of such permission simply because an objector did not notice what was happening. Extending time in such a case so that a legal objection could be mounted by someone who happened to remain unaware of what was going on until many months later would unfairly prejudice the interests of a developer who wishes to rely upon a planning permission which appears to have been lawfully granted for the development of his land and who has prudently waited for a period before commencing work to implement the permission to ensure that no legal challenge is likely to be forthcoming, as happened here. Prompt legal action after grant of a planning permission to challenge its lawfulness will be required in all cases, unless very special reasons can be shown of a kind which are wholly absent in this case. Especial speed will be expected in the case of objectors who have been involved in the planning process throughout, as emphasised by Keene LJ in Finn-Kelcey at [24], but it does not follow that the strong requirement of prompt action will be substantially relaxed in the case of someone who, despite a planning authority’s compliance with the notification rules laid down in law, remained in ignorance.”
The Court of Appeal did extend the time for bringing a claim in Croke v Secretary of State (Court of Appeal, 6 June 2017) which was, as so often, somewhat of a comedy of errors. Given that the deadline for lodging the claim was 23 March 2016, this is what happened:
“The Applicant, who is acting in person, wished to challenge the Inspector’s decision. He proposed to do so by issuing a section 288 claim in the Administrative Court Office at the Royal Courts of Justice, in person, on 23 March 2016. However, that day, he missed his train. Therefore, he emailed the relevant documents to a friend, Mr Miller, who was apparently located only a few minutes from the court; and he asked him to file the claim. It is the Applicant’s case, accepted by the judge below for the purposes of the application before her and by Mr Mills for the Secretary of State today, that Mr Miller arrived at the Royal Courts of Justice at 4.25pm; but, although the advertised closing time for the court was 4.30pm, he was refused entry at the main front entrance of the building, the security guard there informing Mr Miller that the counters were closed.

The following day, Thursday 24 March, the Applicant personally attended the Administrative Court Office, where he arrived at 3.30pm. It was Maundy Thursday and, for the court office, the last working day before the Easter break. Due to the volume of people in the queue, he was not seen until about 5pm, when he was informed by a member of staff that he had used an out-of-date claim form, and he would need to complete a different form. He was given a copy of the new form, and he asked if he could complete it there and then. He was told that he would have to return the next working day. The following day was Good Friday, and the next day upon which the court office was open was Tuesday 29 March. The Applicant attended the Administrative Court Office that day, and filed the claim.”



The court at first instance struck out the claim as out of time. The Court of Appeal however granted permission to Mr Croke to appeal, taking into account that there did not appear to be any legal authority applying to these precise facts:
“Having considered the ground of appeal with particular care – and not without some hesitation – I am persuaded that this appeal is arguable, particularly given the absence of authority on this point. It is also noteworthy that this issue affects not just section 288 claims, but a variety of proceedings where there are strict time limits. Therefore, although the Applicant himself accepts that the merits of his particular case may not be the strongest or attract great sympathy, the issue of principle involved does or may have some broader importance.”
(I don’t know what then happened with Poor Mr Croke’s claim. Deadlines, the risk of missing or incorrect paperwork (or an incorrectly drawn cheque), reduced court hours for filing out of court terms and the current long queues at the Royal Courts of Justice to file claims all combine to give solicitors nightmares – clients, please don’t leave it to the last moment!). 
All this brings us to last month’s case, R (Thornton Hall Hotel Limited) v Wigan Metropolitan Council (Kerr J, 23 March 2018).
The claimant operates Thornton Hall Hotel and the interested party, Thornton Holdings Limited, operates Thornton Manor. The hotels are competitors for wedding bookings and other functions. 

On 7 September 2011 Wigan Council’s planning committee resolved to grant planning permission for three marquees to be erected in the grounds of Thornton Manor. The hotel is in the green belt (as well as being listed grade II* – any Fawlty Towers references in this blog post are by the way wholly inappropriate as will be seen from the above image, courtesy of hitched.co.uk). According to the judgment the committee resolved that very special circumstances existed to allow for the erection of the marquees for a limited period of five years so as to secure “the “generation of an income stream” to enable restoration of the gardens, which were in decline and at risk“. The proposed permission with appropriate conditions was drafted. Indeed, a draft in that form was annexed to a section 106 agreement that was entered into on 11 November 2011. However, the actual permission that was issued on 20 December 2011 and placed on the council’s website omitted any conditions whatsoever, no restriction to five years, no nothing. 
The agent for Thornton Holdings cottoned onto this immediately and said nothing. However the problem was it seems not apparent to the council until the five years period expired and the marquees were not dismantled. The council took a report to committee in July 2017 accepting that a mistake had occurred. A little over a month later (and almost six years after the decision complained of, ie the issue of the incomplete permission) Thornton Hall Hotel Limited brought its proceedings, which were not opposed by the council – so the hearing was purely hotel versus competitor hotel. 
Kerr J allowed the late challenge, and quashed the permission, for nine reasons:
1. The error had been made in issuing the flawed permission. 
2. Permanent permission would not granted and would not have been in the public interest. 
3. “If the marquees are now allowed to stay permanently, the proper operation of the planning process will have been subverted.”
4. That would be contrary to the public interest. 

5. The interested party was aware of the error. 

6. “it follows that the interested party ran its commercial operation at Thornton Manor from 22 December 2011 knowing that the presence of the marquees after 19 December 2016 would be, at the very least, a matter of possible controversy and possible legal challenge. It was not, in my judgment, realistic to rely on expiry of the three month limitation period without also bringing the issue into the open, which the interested party decided not to do.”

7. It follows that the interested party cannot say that it would be prejudiced by the quashing due to lost bookings. 

8. “it is said by the interested party that it would be detrimental to good administration if the marquees have to be removed. Normally, detriment to good administration in public law cases relates to the undesirability of interfering with the provision of public services rather than commercial interests. I see no detriment to good administration in rectifying the error. I think it is detrimental to good administration that the marquees are still there. Good administration includes correct implementation of planning decisions.”

9. “the interested party signed the section 106 agreement embodying the omitted conditions including the five year time limit. Yet, it proceeds in this litigation as if it were not bound by the terms of that agreement. That seems to me only to compound the unconscionability of its position. It undertook in private law the same obligations as it denies in public law.”

As they say, hard cases make bad law. Whilst clearly no-one should have any sympathy for the interested party, which saw that it had by luck gained something it never deserved, there are really serious repercussions and I can’t see that other factors were taken on board by the judge, for instance:
1. There is no discussion of the public interest in being able to rely on permissions once free from legal challenge. When acting on the acquisition of properties or businesses, what do we now need to do to ensure that our client isn’t going to find that its permission is similarly flawed? Sometimes it will not be at all obvious. Does the permission, even if many years old, need to be checked against the resolution to grant? What about other latent flaws in it?
2. Surely, the council should have sought a revocation or modification order. No doubt it would have had to pay substantial compensation to Thornton Holdings but is that relevant? The permission was on the website and could have been challenged within the deadline. No-one challenged it (and why indeed should it be down to a competitor to spend money at risk on a challenge? What if it hadn’t?). It used to be considered that authorities, in considering whether to make a revocation or modification order, couldn’t take their potential compensation liability into account. To my mind it was a sad day when that changed as a result of the Supreme Court’s ruling in Health & Safety Executive v Wolverhampton City Council (Supreme Court, 18 July 2002). As a result, revocation and modification orders are almost unused. 

3. There are of course many examples of flawed permissions which authorities issued in error where hitherto the possibility of a late challenge does not appear to have been considered. (See some of them in my 14 October 2017 blog post Flawed Drafting: Interpreting Planning Permissions). Is this ruling, even if only slightly, going to open the floodgates, particularly in relation to the errors that most frequently occur on section 73 permissions where it turns out that previous restrictive conditions have been lost, for example as to the types of goods that may be sold from a retail park?

Does anyone knows whether an application for permission to appeal has been made? I would welcome views as to how we all take on board the practical implications of this case. Or do we simply regard it as turning on fairly extreme facts? I’m not so sure. 

Simon Ricketts, 7 April 2018

Personal views, et cetera


“No conditions, you say?”