Do Your Conditions Have Symmetry In Mind?

A judgment of the Court of the Appeal yesterday – DB Symmetry Limited v Secretary of State (Court of Appeal, 16 October 2020) – has potentially wide implications.

The court ruled that a condition on a planning permission cannot as a matter of law require land to be dedicated as highway. Unless a realistic interpretation can be given to the condition which avoids that outcome, and if the condition is not considered to be severable from the permission as a whole, in some circumstances the validity of the planning permission may be at risk.

Such a requirement needs instead to be included in that endangered species, the section 106 agreement.

The case arose from the first planning permission to be granted for part of the Swindon New Eastern Villages urban extension (“NEV”), which will eventually comprise 8,000 homes, 40 hectares of employment land and associated retail, community, education and leisure uses. The planning permission in part authorised the construction of a section of spine road envisaged eventually to connect through the wider development.

The report to committee in relation to the planning application explained “that the application site was part of a wider development proposal. It was to “integrate physically and functionally” with adjoining development. The NEV was to come forward as “a series of new interconnected villages.” Each scheme had to demonstrate how it fitted into the wider NEV. The proposal “must provide connections to future development within the [NEV] in the interests of enabling the comprehensive and sustainable development of the NEV as a whole”.

A condition was attached to the planning permission, condition 39:

“Roads

The proposed access roads, including turning spaces and all other areas that serve a necessary highway purpose, shall be constructed in such a manner as to ensure that each unit is served by fully functional highway, the hard surfaces of which are constructed to at least basecourse level prior to occupation and bringing into use.

Reason: to ensure that the development is served by an adequate means of access to the public highway in the interests of highway safety.”

The developer took the position that this condition did not require the dedication of the roads as public highway. I do not know why: perhaps wishing to retain greater control over their maintenance as private roads, perhaps wishing to retain the ability to charge a premium to those who might in the future wish to connect into the roads, including other developers.

As explained by Lewison LJ in the judgment, “the developer applied to Swindon for a certificate under section 192 of the Town and Country Planning Act 1990 that the formation and use of private access roads as private access roads would be lawful. Swindon refused the certificate; and the developer appealed. On 6 November 2018 Ms Wendy McKay LLB, an experienced planning inspector, allowed the appeal. She certified that the use of the access roads for private use only would be lawful.”

The council challenged the decision and at first instance Andrews J quashed it.

The Court of Appeal disagreed in no uncertain terms, regarding itself as bound by a 1964 Court of Appeal judgment, Hall & Co Ltd v Shoreham by Sea Urban DC:

“In Hall & Co Ltd v Shoreham by Sea Urban DC [1964] 1 WLR 240 sand and gravel importers and the owners and occupiers of land in an area scheduled for industrial development, applied for planning permission to develop part of their land for industrial purposes. The land adjoined a busy main road which was already overloaded. The highway authority intended to widen it at a future date and to acquire for that purpose a strip forming part of the developer’s land. The planning authority granted planning permission subject to a condition requiring the developer to “construct an ancillary road over the entire frontage of the site at their own expense, as and when required by the local planning authority and shall give right of passage over it to and from such ancillary roads as may be constructed on the adjoining land.” It is to be noted that the condition did not require the transfer of the land itself.

This court held that the imposition of that condition was unlawful. At 247 Willmer LJ summarised the developer’s argument as follows:

“It is contended that the effect of these conditions is to require the plaintiffs not only to build the ancillary road on their own land, but to give right of passage over it to other persons to an extent that will virtually amount to dedicating it to the public, and all this without acquiring any right to recover any compensation whatsoever. This is said to amount to a violation of the plaintiffs’ fundamental rights of ownership which goes far beyond anything authorised by the statute.

…

“The defendants would thus obtain the benefit of having the road constructed for them at the plaintiffs’ expense, on the plaintiffs’ land, and without the necessity for paying any compensation in respect thereof. Bearing in mind that another and more regular course is open to the defendants, it seems to me that this result would be utterly unreasonable and such as Parliament cannot possibly have intended.”

“Harman LJ said at 256: “It is not in my judgment within the authority’s powers to oblige the planner to dedicate part of his land as a highway open to the public at large without compensation, and this is the other possible interpretation of the condition. As was pointed out to us in argument, the Highways Acts provide the local authority with the means of acquiring lands for the purpose of highways, but that involves compensation of the person whose land is taken, and also the consent of the Minister.”

In the light of Hall, Lewison LJ concluded:

“I consider that, at least at this level in the judicial hierarchy, a condition that requires a developer to dedicate land which he owns as a public highway without compensation would be an unlawful condition. Whether the unlawfulness is characterised as the condition being outside the scope of the power because it requires the grant of rights over land rather than merely regulating the use of land; or whether it is a misuse of a power to achieve an objective that the power was not designed to secure; whether it is irrational in the public law sense, or whether it is disproportionate does not seem to me to matter. In my judgment Hall establishes a recognised principle which is binding on this court.”

“If the judge interpreted [advice in a previous Government circular] as authorising the imposition of conditions which not only required a developer to provide an access road, but also to dedicate it to public use as a highway, I consider that she was wrong. Such an interpretation would be flatly contrary to consistent government policy for nearly 70 years. In my judgment Hall does impose an absolute ban on requiring dedication of land as a public highway without compensation as a condition of the grant of planning permission. I also consider, contrary to Mr Harwood’s submission, that there is no difference for this purpose between dedicating a road as a highway and transferring the land itself for highway use. As I have said, the condition in Hall did not require the land itself to be transferred, yet it was still held to be unlawful.”

The reference to “at least at this level in the judicial hierarchy” is interesting – has the council the appetite to apply for permission to appeal to the Supreme Court? Hall was decided in another time and is it right that the operation of conditions should continue to be constrained in this way? Whilst Hall and Symmetry were both cases about conditions that potentially required the dedication of land as highway, the same principle would apply to conditions requiring the dedication, disposal or transfer of land for other purposes, e.g. open space or affordable housing. Care is required! The distinction nowadays between the “imposition” of planning conditions and the “agreement” of section 106 planning obligations is surely somewhat artificial – on major schemes, conditions are negotiated by the parties to almost an equivalent extent as planning obligations may be – and if the applicant isn’t happy with a condition that has been imposed, section 96A and section 73 are always available. Furthermore, Willmer J’s 1964 reference to the relevant condition amounting to a “violation of the plaintiffs’ fundamental rights of ownership which goes far beyond anything authorised by the statute” looks quaint from a 2020 perspective, where the price of planning permission for any significant scheme entails multiple violations of those so-called “fundamental rights” – and, on proposals within areas allocated for comprehensive development, in my view “anti-ransom” arrangements are essential planning prerequisites – why shouldn’t a condition be enabled to achieve that objective?

Once the Court of Appeal had concluded that the condition could not lawfully have the effect of requiring roads to be dedicated as public highway, it needed to consider whether another interpretation could realistically be given to the condition.

“In her decision letter, the inspector expressed her conclusion at [20] as follows: “Whilst the term “highway” usually means a road over which the general public have the right to pass and repass, the phrase “fully functional highway” cannot be divorced from the beginning of the sub-clause which states “shall be constructed in such a manner as to ensure…”. In my view, Condition 39 simply imposes a requirement concerning the manner of construction of the access roads and requires them to be capable of functioning as a highway along which traffic could pass whether private or public. It does not require the constructed access roads to be made available for use by the general public. I believe that a reasonable reader would adopt the Appellant’s understanding of the term “highway” as used in the context of the condition with the clear reference to the construction of the roads as opposed to their use or legal status. The distinct inclusion of the term “public highway” in the reason for imposing Condition 39 reinforces my view on that point.”

Lewison LJ:

“I do not think that the judge really appreciated the consequences of her decision. In my judgment, if the judge was right in her interpretation of the condition, the condition (and probably the whole planning permission) is invalid. In those circumstances, the validation principle comes into play. The question, then, is whether the inspector’s interpretation of condition 39 was realistic (even if not the most obvious or natural one).”

“In my judgment, the interpretation adopted by the inspector is, to put it no higher, a realistic one even if it is not the most natural. The validation principle therefore applies; and condition 39 should be given the meaning that she ascribed to it.”

Surely if the court had not managed to get to this interpretation of the condition it would not have quashed the whole consent? For the council that would have certainly been a “You’re only supposed to blow the bloody doors off!” moment.

What if the condition had been negatively worded: not to occupy more than x dwellings until defined roads had been constructed and satisfactory arrangements had been made for their adoption as public highway? Any different outcome?

The obvious practical lesson is to document these sorts of dedication and land transfer requirements other than by condition but let’s see if there’s a further appeal.

Simon Ricketts, 17 October 2020

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