SIMONICITY

VIP, Biscuits: 2 More Refusals For Major Projects In London

“Getting messy isn’t it?” was how I ended my 26 January 2019 blog post The Secretary Of State & London.

Two more decisions to note since that blog post:

VIP Trading Estate and VIP Industrial Estate, Charlton

I suspect that this is the first example of a London Mayor calling in an application for his own determination and refusing it. In the final month of his mayorality in April 2016, Boris Johnson had agreed to defer a decision in relation to Bishopsgate Goodsyard, faced with an officer’s recommendation to refuse the application (it ended up never being determined). But Sadiq Khan’s flip flopping over Leopard Guernsey Anchor Propco Limited’s application to the London Borough of Greenwich for planning permission to redevelop the VIP Trading Estate and VIP Industrial Estate, Charlton has been quite something else.

This is a scheme that started off as comprising 975 dwellings , together with non-residential floorspace, in buildings ranging from nine to 28 storeys. Following consultation responses and comments from the Mayor in his stage 1 referral report, the 28 storey tower was removed and the amount of housing reduced to 771.

Greenwich officers recommended approval but on 9 July 2018 committee members resolved to refuse it on five grounds, namely overdevelopment, insufficient proportion of family sized housing, lack of a safe access to the business premises next door (a building known as Imex House that houses Squeeze’s Glenn Tilbrook’s studio) and introduction of noise sensitive uses, failure to make appropriate replacement employment floorspace provision and daylight/sunlight deficiencies.

Having considered his officers’ stage 2 report dated 13 August 2018, the Mayor called in the application for his own determination. The report sets out the various improvements that would be sought to the proposals as part of the call in process.

Various amendments were negotiated and secured. Officers’ stage 3 report was published for the representation hearing held on 29 January 2019. The report recommended approval.

But then the bombshell at the end of the representation hearing. Despite having intervened to prevent Greenwich members refusing the application against their officers’ recommendations six months previously, and despite amendments to the scheme proposals having been negotiated to officers’ satisfaction, presumably in line with the Mayor’s instructions (if not, was he not paying attention or something?), the Mayor then announces that he is refusing the application. His reasons for refusal published a few days later on 4 February 2019 in part bear a marked resemblance to those of Greenwich’s planning committee: poor design; unsatisfactory relationship with Imex House and introduction of noise sensitive uses; failure to make appropriate replacement employment floorspace provision, and absence of a section 106 agreement to secure affordable housing and other obligations (I’m not sure whether this is a purely procedural reason for refusal or he was actually not satisfied with the affordable package negotiated by his officers: 35%, rising to 40% with grant).

I have no views on the scheme itself, and I accept that of course he must have an open mind during the representation hearing, but what a waste of six months! He says in the letter setting out his reasons for refusal that he “called in this application to subject it to further scrutiny” but that is a poor excuse. He was surely looking to use the particularly useful Mayoral call in power in order to squeeze some further enhancements from the scheme so that, when that had been done by his officers to his satisfaction, he could approve it. In turning it down, where does that leave his officers? And given that applicants are unable to engage with the man himself, can they now be sure that what they are being told by his team is necessary to secure approval will indeed be sufficient?

Bermondsey Biscuit Factory and Bermondsey Campus Site

The decision of the London Borough of Southwark at its planning committee meeting on 6 February 2019 to refuse planning permission for Grosvenor’s 1,342 dwelling build to rent scheme in Bermondsey is another one to be aware of. Members followed the recommendations in the officers’ report, the main reason being that Grosvenor’s affordable housing package was unacceptable, comprising, in summary, that 27.37% of the habitable rooms would be let at an average discount of 25% below market rents, with usual early and late stage viability review mechanisms. (The application indicated that “the depth of discount across the affordable units could vary, with greater discounts offered on some units, but this would require higher rents (up to 80% of market rents) on others to ensure that the overall level of discount does not exceed 25% overall. Grosvenor has described the sum equating to a 25% discount as the ‘subsidy pot’ and suggested whilst this could be distributed in a variety of ways, the impact of the DMR cannot exceed the financial value of that ‘subsidy pot’ “).

The Mayor of London had flagged in his stage 1 report: “Whilst the proposed increase in housing supply is strongly supported, in the absence of an independently verified viability position the proposed 27% provision of affordable housing is unacceptable. The applicant must deliver deeper DMR discounts, including London Living Rent”

Southwark took an equivalent position but the report to committee is interesting in the way that it (1) transparently sets out the differences between the viability work carried out by the parties’ respective viability consultants (GVA – in old money, now Avison Young – having advised the council after the publication of the Mayor’s stage 1 report) and (2) highlights the differences in build to rent (referred to as PRS, private rental sector, in the committee report) affordable housing policy approach in two dimensions: at GLA vs borough level, and as between adopted and emerging plans. Not an unfamiliar position for any developer but particularly difficult for those promoting build to rent (which is, after all, strongly supported in principle by MHCLG and the Mayor of London) as a relatively new product in terms of determining the appropriate approach to affordable housing.

The viability differences are nicely summarised by Mike Phillips (ex Property Week editor) in his 4 February 2019 Bisnow piece Grosvenor’s Bermondsey Rejection Is A Microcosm Of London’s Affordable Housing Quandary.

As to the complexities arising from varying policy approaches to build to rent, a few extracts from the committee report:

⁃ “London Plan policies 3.11 and 3.12 and draft London Plan Policy H5 seek to maximise the delivery of affordable housing, with the draft London Plan seeking delivery against a strategic target of 50%. Policy H6 of the draft London Plan and the Affordable Housing and Viability SPG prescribe a threshold approach to affordable housing to incentivise swift delivery, and draft London Plan Policy H13 applies this principle to ‘build to rent’ products. In this case, a minimum of 35% affordable housing threshold applies.”

⁃ The Mayor’s affordable housing and viability SPG “recognises that Discount Market Rent is an appropriate tenure within PRS developments and considers that the rent level for DMR should be pegged at London Living Rent levels, for households with incomes up to £60,000. The guidance requires affordable housing to be secured in perpetuity, and in addition requires a clawback mechanism if the wider PRS homes are sold out of the Build to Rent sector within 15 years. The clawback is intended to respond to the different financial model applied to the PRS sector and to ensure the developer does not benefit financially if the homes are converted to market sale.”

⁃ The borough’s core strategy “requires that a minimum 35% affordable housing is provided on all residential developments of 10 or more units, with a tenure split in the Bermondsey area of 70:30 social rent: intermediate homes. Applications would be subject to viability assessments if policy compliance is not being offered, with the expectation that as much affordable housing will be provided as is financially viable. The Core Strategy makes no specific reference to PRS housing.”

⁃ The submission version of the New Southwark Plan “requires the affordable ‘DMR’ housing to be secured in perpetuity, and the overall housing development to be secured within the rental sector for at least 30 years” [contrast with the Mayor’s 15 year requirement] with a changed tenure split of 15% social rent and 20% DMR at London Living Rent [contrast to GLA position where it can all be London Living Rent DMR]

Clearly it is going to be key for the parties to resolve their difficulties over viability, whether that requires changes to the scheme or an appeal. This was a decision taken against up to date government guidance on the approach to viability appraisals, the work was relatively transparent and there was not a major difference of principle over benchmark land value. The reality is that the process is not straightforward; there are issues of judgment, particularly when dealing with a relatively untested business model and the need to estimate the rents that will be achievable in an area that will have been significantly changed by way of development. After that, the tenure split question is surely economically subsidiary, although clearly on-site social rented housing will come at greater cost to the scheme’s viability in a number of ways and so there are political choices to be made.

More widely

I’m not sure whether the Secretary of State had either scheme specifically in mind, when he threw his own political pebble into the pond, as reported in the Planner on 31 January 2019: Brokenshire tells GLA to step up (https://www.theplanner.co.uk/news/brokenshire-tells-gla-to-‘step-up’ ). People in glass houses…

In the meantime, the examination continues into the draft London Plan. Hearing sessions are currently considering housing issues, with MHCLG participating. The Just Space website is a useful unofficial resource in relation to the examination, with links to each written statement for each session together with thumbnail-sketch type notes of the session itself.

Lastly, as a postscript to my 26 January 2019 blog post, it has now been reported that Croydon Council as well as possibly the Mayor are supporting Thornsett Group’s challenge of the Secretary of State’s Purley Baptist Church call-in decision.

Still messy, isn’t it?

Simon Ricketts

Personal views, et cetera

Peek Frean biscuits, from Bermondsey.

What To Do About Poor Air Quality? The Shirley Case

In this week of all Brexit weeks it was interesting to see the approach of the Court of Appeal in a case, R (Shirley) v Secretary of State (Court of Appeal, 25 January 2019), which turned on the practical extent of the Secretary of State’s duty to give effect to the objectives of the Air Quality Directive. The UK is under binding commitments in the Air Quality Directive to improve air quality, transposed into domestic law by way of the Air Quality Standards Regulations 2010. Was he required to call in for his own determination a planning application for development that would worsen or prolong breaches of limit values in an Air Quality Management Area (“AQMA”) for nitrogen dioxide or PM10?

Before we turn to the ruling, a quick update may be useful on the continuing saga of the Government’s continued failure to prepare a lawful Air Quality Plan in compliance with its duties under the Air Quality Directive (its deadline having been 1 January 2010) since my 4 November 2016 blog post The UK Government & Air Quality (ahem). At the point I wrote the blog post, the Supreme Court had ordered in April 2015 that the Government should prepare a legally compliant Air Quality Plan by the end of 2015, the Government had purported to publish compliant proposals on 17 December 2015 which were then found to be legally inadequate by Garnham J in his judgment in ClientEarth v Secretary of State (No. 2) (Garnham J, 2 November 2016). He gave the Government a further deadline of 31 July 2017.

The Government purported to comply by that deadline but Garnham J held that attempt too was deficient in a number of respects, in R (ClientEarth) v Secretary of State (No. 3) (Garnham J, 21 February 2018). He made a declaration as to the deficiencies as against the requirements of the Directive and Regulations, ordered the urgent production of a supplement to rectify the deficiencies and that the balance of the plan should remain in force in the meantime to avoid any delay in its implementation. His judgment concluded:

“I end this judgment where I began, by considering the history and significance of this litigation. It is now eight years since compliance with the 2008 Directive should have been achieved. This is the third, unsuccessful, attempt the Government has made at devising an AQP which complies with the Directive and the domestic Regulations. Each successful challenge has been mounted by a small charity, for which the costs of such litigation constitute a significant challenge. In the meanwhile, UK citizens have been exposed to significant health risks.

It seems to me that the time has come for the Court to consider exercising a more flexible supervisory jurisdiction in this case than is commonplace. Such an application was made to me when the November 2016 judgment was handed down. I refused it on that occasion, opting for a more conventional form of order. Given present circumstances, however, I would invite submissions from all parties, both in writing and orally, as to whether it would be appropriate for the Court to grant a continuing liberty to apply, so that the Claimant can bring the matter back before the court, in the present proceedings, if there is evidence that either Defendant is falling short in its compliance with the terms of the order of the Court”.

The Government published a supplement to its plan on 5 October 2018 and as far as I know there has been no legal challenge to it or application back to Garnham J pursuant to his liberty to apply. So we may finally now have a legally compliant Air Quality Plan?

In the meantime, the European Commission has commenced infringement proceedings against the UK and other member states for delays in implementing the Directive.

To bring the narrative right up to date, the Government published its Clean Air Strategy on 14 January 2019, setting out proposed measures that will in due course form part of the forthcoming Environment Bill. On an initial reading there seems to be a deliberate shift away from the areas where the Government has found it difficult to comply with the Air Quality Directive, particularly in relation to polluting emissions from vehicles. From the foreword by Michael Gove:

“We often think of air pollution as a problem caused by road transport and industrial level burning of fossil fuels. These are two of the central sources of pollution, but industry and government have worked together to remedy many of the worst problems by incentivising the use of clean fuels and investing in new technology. We have already secured a significant reduction in emissions since the 1970s. But now this trajectory has slowed.

Now we need to tackle other sources of air pollutants that damage human health and the environment. Air pollution can be caused by intensive agricultural food production, heating our homes or even cleaning with certain solvents”

Whether that is well based is for others to judge.

But perhaps more of that another day and now back to Shirley. The appeal before the Court of Appeal concerned an application by Corinthian Mountfield Limited for planning permission for 4,000 dwellings and associated development that had been resolved to be approved by Canterbury Borough Council.

Dove J had rejected the appellants’ claim for judicial review of the Secretary of State’s decision not to call in the application. The Court of Appeal considered three grounds of appeal:

“(1) whether the preparation and implementation of an air quality plan complying with Article 23 of the Air Quality Directive would be a sufficient response to breaches of limit values (ground 1 in the appellant’s notice);

(2) whether the Secretary of State had a duty as “competent authority” to use his planning powers to avoid the worsening or prolongation of breaches of the limit values, and was therefore obliged to call in Corinthian Mountfield’s application for planning permission (ground 2); and

(3) whether it was irrational for the Secretary of State to assume that any errors in the city council’s approach could be put right if it reconsidered the application, or could be brought before the court in a claim for judicial review if planning permission were granted (ground 3).”

The point is an important practical one – if a project is likely to increase exceedances of pollutant limit values, does that by itself lead to the risk of call in or legal challenge?

“Is the preparation and implementation of an air quality plan complying with article 23 of the Air Quality Directive a sufficient response to breaches of limit values?

Article 13 of the Directive, transposed by Regulation 17 of the Regulations, requires the Secretary of State to ensure that levels of specified pollutants do not exceed defined limit values. In zones where levels are below the limit values the Secretary of State must “ensure that levels are maintained below those limit values and must endeavour to maintain the best ambient air quality compatible with sustainable development“.

Article 23 of the Directive, transposed by Regulation 26 of the Regulations, requires that where exceedances of annual mean limit values of specified pollutants occur, the Secretary of State must draw up and implement an air quality plan to achieve the limit value.

Dove J had “concluded that when the limit values in the Air Quality Directive are exceeded, if article 13 is read with articles 22 and 23, the preparation and implementation of an air quality plan with a view to overcoming those exceedances and keeping their duration as short as possible is the “specific and bespoke remedy”. There was, he said, “no room within the scheme” of the Air Quality Directive for any “freestanding responsibility” to take any specific action on “permits” or “development consents”. He was “unable to read into the legislation any requirement to take particular actions in relation to permits or development consents”.

“For the appellants, Mr Robert McCracken Q.C. submitted that the judge had erred in his understanding of the Air Quality Directive and the 2010 regulations. He had failed to adopt a suitably purposive approach, failed to recognize the high level of environmental protection required by EU law, and failed to follow the approach taken by the Court of Justice of the European Union in relevant authority. He had not grasped that the Air Quality Directive requires the taking of action, not merely the preparation of air quality plans, and that the adoption and implementation of an air quality plan is a necessary but not a sufficient response to breaches of limit values…”

As referred to in my 4 November 2016 blog post, this has been Robert McCracken QC’s position for a long time – indeed in my blog post I included a link to his 2015 legal opinion to that effect.

Lindblom LJ examines in detail the Court of Justice of the European Union case law before agreeing with Dove J and rejecting the “purposive approach” argument:

“Dove J.’s description of article 23 as providing the “specific and bespoke remedy” for a breach of article 13 therefore seems apt. This does not mean that Member States may not also adopt other measures to address a breach of article 13, in addition to preparing and putting into effect an air quality plan complying with article 23. But nor does it mean that Member States are compelled by any provision of the Air Quality Directive to do that. A demonstrable breach of article 13 does not generate some unspecified obligation beyond the preparation and implementation of an air quality plan that complies with article 23. The case law does not suggest, for example, that in such circumstances a Member State must ensure that land use planning powers and duties are exercised in a particular way – such as by imposing a moratorium on grants of planning permission for particular forms of development, or for development of a particular scale, whose effect might be to perpetuate or increase exceedances of limit values, or by ensuring that decisions on such proposals are taken only at ministerial level“.

Did the Secretary of State have a duty as “competent authority” to use his planning powers to avoid the worsening or prolongation of breaches of limit values?

Again, the answer was no:

“I cannot accept that argument. It finds no support in relevant case law. In my view, as Mr Maurici and Mr Pereira submitted, it is not possible to construe the provisions of the Air Quality Directive and the 2010 regulations as constraining the Secretary of State’s very wide discretion either to call in or not to call in an application for planning permission when the limit values under article 13 have not been complied with, or when an air quality plan under article 23 has not yet been put in place or has proved to be deficient or ineffective. The air quality legislation does not do that. It does not have the effect of narrowing the Secretary of State’s call-in discretion in such circumstances, let alone of transforming that discretion into a duty, or of requiring a particular application for planning permission to be refused. None of the provisions of the Air Quality Directive engages with the process of making decisions to authorize individual projects of development. If a proposed development would cause a limit value to be breached, or delay the remediation of such a breach, or worsen air quality in a particular area, neither the Air Quality Directive nor the 2010 regulations states that planning permission must be withheld or granted only subject to particular conditions. These may of course be material considerations when an application or appeal is decided, and so too the measures in an air quality plan for the relevant zone, if there is one, or in an action plan prepared under the Environment Act 1995. But the Air Quality Directive and the 2010 regulations do not, in those or any other circumstances, compel the decision-maker to refuse planning permission, or impose on the Secretary of State an obligation to make the decision himself.”

Was the Secretary of State’s decision not to call in the application irrational?

Given that planning permission had not yet been granted by the city council, it was open to the council to take the application back to committee if it was not called in.

Lindblom LJ held that the Secretary of State’s freedom to exercise his call-in discretion is considerable. “The Secretary of State also knew that if he did not call in the application, the city council would be able to consider it again, taking account of any further representations made to it, and, with the advice of its officers and professional consultants, revisiting the committee’s resolution to grant planning permission. And if planning permission were to be granted, it could be challenged by a claim for judicial review. It was not perverse for the Secretary of State to have these considerations in mind when he made his decision not to call in.”

Lastly, the Court of Appeal considered and rejected for four reasons the appellants’ submission that a reference should be made on the first ground of appeal to the Court of Justice of the European Union:

⁃ the appeal failed in any event on the other grounds so a decision on the questions in the reference would not be necessary to enable this court to give judgment;

⁃ the issue was in the court’s view “acte clair” (ie reasonably clear and free from doubt)

⁃ a reference would cause unjustifiable delay in a case where the decision under challenge was procedural, not substantive

⁃ a reference was opposed by all four respondents.

Concluding thoughts

The case is an interesting example of the way in which EU law has become so familiar to the lawyers and judges of our domestic courts. Nearly all of our environmental law is EU-derived. Post-Brexit, when EU-derived legislation such as the Air Quality Standards Regulations will continue to apply (unless and until amended or revoked) on a free-standing basis and without the backing of the Directive, it is inconceivable to imagine that we will not all in practice still draw upon the CJEU’s case law to assist in matters of interpretation.

Over time this may change, once our legislation starts to diverge with that of the EU (we see already the deliberately differing objectives and approaches of DEFRA’s Clean Air Strategy) and once differing strands of judicial interpretation start slowly to open up. It’s going to get complicated. Our judges will always be more resistant to the purposive approach to interpretation – legislation should mean what it says – which is why in our common law system it is so important that our laws are precise rather than broad statements of principle in the way that has led to so much litigation in relation to EU Directives.

The case also illustrates the scale of the hurdles to be cleared in persuading our courts to refer issues to the Court of Justice of the European Union. If there had been a reference in Shirley, could we have completely ruled out the prospect of a surprise finding, à la People Over Wind? I’m still grumbling, five years on, about the Supreme Court’s refusal in the HS2 Action Alliance case to refer the Strategic Environmental Assessment issues that we raised to the CJEU. The risk/prospect of referral is generally a low one.

The earlier ClientEarth sequence of cases (within which there was in fact a reference) raises the separate question as to whether it is sufficient for responsibility for compliance with environmental targets to remain with Parliament and whether the proposed Office for Environmental Protection would have sufficient power as against a future Government that is dragging its heels. Would the OEP be able to fulfil that supervisory role that Garnham J has had to take in the ClientEarth litigation?

But in the meantime, it is helpful to have the Court of Appeal’s clarification that non-compliance by the Government with its international responsibilities does not lead to what would effectively been an embargo on any form of development where it could be argued that there might be an adverse effect on air quality in an AQMA, regardless of the local improvement measures to which the relevant local authorities had committed under the Directive and Regulations, and regardless of the usual statutory requirement for decision makers to determine applications in accordance with the development plan unless material considerations indicate otherwise. It would have led to decision-making chaos.

But that shouldn’t let anyone off the hook. The onus really must continue to rest with the Government and local authorities to take the necessary steps to ensure that roadside emissions are reduced to acceptable levels, no matter how politically unpopular the implications (eg further charging zones, making it more expensive and less convenient to use a polluting vehicle and the reverse for users of public transport – and priority being given to pedestrians and cyclists in our cities). The onus must also rest with developers to seek to ensure that their proposals are, in the language of the draft London Plan, air quality neutral or positive.

Clean air may be invisible but surely, one day, it will be seen as a vote winner?

Simon Ricketts, 2 February 2019

Personal views, et cetera

The Secretary Of State & London

The Secretary of State wrote last year to the Mayor of London: “I am not convinced your assessment of need reflects the full extent of housing need in London to tackle affordability problems. I have listened carefully to yours, and others, representations, and I am clear that the public interest lies with ensuring you deliver the homes London needs, including in the short term, as quickly as possible.”

Do we see this same message being delivered in his recent interventions?

None of this is news to regular readers of Planning magazine but I give you:

Purley Baptist Church site, Croydon

A scheme by Thornsett Group and Purley Baptist Church for the “demolition of existing buildings on two sites; erection of a 3 to 17 storey development on the ‘Island Site’ (Purley Baptist Church, 1 Russell Hill Road, 1-4 Russell Hill Parade, 2-12 Brighton Road, Purley Hall), comprising 114 residential units, community and church space and a retail unit; and a 3 to 8 storey development on the ‘South Site’ (1-9 Banstead Road) comprising 106 residential units, and associated landscaping and works.”

Supported by the London Borough of Croydon and by the Mayor. But opposed by, amongst others, Conservative MP Chris Philp (Croydon South). The application was called in on 12 April 2017 and, despite inspector David Nicholson recommending approval, refused by the Secretary of State in his decision letter dated 3 December 2018, essentially on design and heritage grounds:

26. Given his serious concerns about the design of the scheme as set out above at paragraphs 13 to 15, for the reasons given above the Secretary of State does not consider that the application is in accordance with the development plan overall. He has gone on to consider whether there are material considerations which indicate that the proposal should be determined other than in accordance with the development plan.

27. In favour, the scheme will provide 220 new homes which he considers should be given significant weight. The Secretary of State also affords significant weight to the benefits to Purley District Centre arising as a result of the regeneration of the site. The provision of a new church and greatly enhanced community facilities are also benefits, to which the Secretary of State gives moderate weight. He considers the level of affordable housing and the potential effects on air quality to be neutral in the planning balance.

28. Against the scheme, however, the Secretary of State gives substantial weight to the poor design of the South Side proposals, and to the height and proportions of the tower set out in paragraphs 13 to 15 above, which he considers not to be in accordance with relevant policies in the development plan.

29. The Secretary of State has also considered whether the identified ‘less than substantial’ harm to the significance of Purley Library and surrounding Conservation Areas is outweighed by the public benefits of the proposal. In accordance with the s.66 LBCA duty, he attributes considerable weight to the harm the significance of Purley Library. However, he considers that the benefits of the scheme, as set out in Paragraph 22 of this letter, are insufficient to outbalance the identified ‘less than substantial’ harm to the significance of Purley Library and surrounding conservation areas. He considers that the balancing exercise under paragraph 196 of the Framework is therefore not favourable to the proposal.”

It always feels slightly odd when the Secretary of State, on a desk-based examination of a set of papers, and following a public inquiry, considers it appropriate to overrule the judgment of local planning authority, Mayor and inspector in relation to these sorts of issues

I understand that the decision has been challenged in the High Court by the applicants.

Sir William Sutton Estate, Royal Borough of Kensington and Chelsea

By contrast, a scheme opposed both by RBKC (which refused permission) and by the Mayor for “demolition of the existing [Sir William Sutton] estate (Blocks A-K, N and O) and ancillary office; delivery of 343 new residential homes comprising of 334 apartments and 9 mews within buildings of 4-6 storeys; provision of Class D1 community floorspace with associated café; new Class A1-A5 and B1 floorspace; creation of new adopted public highway between Cale Street and Marlborough Street; new vehicular access from Ixworth Place; creation of new basement for car parking, cycle parking and storage; new energy centre fuelled by CHP, and works to adjacent pavement“.

The developer, Clarion Housing Group (formerly Affinity Sutton Homes Limited), appealed. Curiously, the appeal was only recovered by the Secretary of State for his own determination on 1 May 2018, just over a week before the start of the inquiry. By his decision letter dated 18 December 2018 the Secretary of State accepted his inspector’s recommendation and dismissed the appeal.

The main issue was in relation to the level of affordable housing proposed. After the appeal was submitted, the appellant had attempted to improve the position with changes to the scheme:

“The key changes relate to the quantum of social rented housing and the number of mews houses. The Revised Scheme proposes 2,825 m2 more social rented floorspace, an increase from 237 to 270 social rented homes. The 9 private mews houses would be removed and replaced with social rented flats. Elements of the building design would be changed. The Revised Scheme results in an increase in the overall number of homes from 343 to 366.

The non-residential floorspace in the Appeal Scheme and the Revised Scheme would be the same in respect of Classes A1-A3 and B1 workspace, but there would be a decrease in the community floorspace in the Revised Scheme.”

However, applying ‘Wheatcroft‘ principles (“the main, but not the only, criterion on which… judgment should be exercised is whether the development is so changed that to grant it would be to deprive those who should have been consulted on the changed development of the opportunity of such consultation”) the Secretary of State, agreeing with the recommendation of his inspector, refused to consider the revised scheme due to concerns as to the adequacy of the consultation that had been carried out. (One legitimate criticism was of “skewed” questioning of the public in a Feedback Form which asked “Do you support the proposals to amend the scheme to provide 33 additional homes for social rent?“, although I have seen similarly skewed questioning in MHCLG consultation documents…).

The Secretary of State did not accept the appellant’s position as to whether there was existing affordable housing on the site:

“vacation of a property by a Registered Provider as a preliminary step towards estate renewal cannot reasonably be a basis for disregarding that floorspace for the purposes of affordable housing policy. He further agrees, for the reasons given at IR206-218, that the AS fails to comply with the ‘no net loss’ element of development plan policy.”

He considered that for the same reason the benchmark land value for the purposes of viability appraisal should be “based on the current situation, that is based on social housing development, as the Council contends.”

He concluded that the appeal scheme failed “to satisfy the policy aims of no net loss of social housing and maximum reasonable provision, largely for reasons related to the way in which the exiting [sic] vacant units of social housing are treated.”

Newcombe House, Notting Hill

Still in RBKC and back to the saga of Newcombe House. As summarised in my 18 June 2017 blog post, an appeal in relation to the proposed development of the site had been rejected by inspector David Nicholson (as of the Purley Baptist Church site case above). The refusal had partly been on similar grounds to the dismissal of the Sir William Sutton Estate appeal.

A new scheme was brought forward by the developer, Notting Hill KCS Limited, for “demolition of existing buildings and redevelopment to provide office, 46 residential units, retail uses, and a flexible surgery/office use, across six buildings (ranging from ground plus two storeys to ground plus 17 storeys), with two-storey basement together with landscaping to provide a new public square, ancillary parking and associated works.”

RBKC resolved to refuse the new application on 31 January 2018, on townscape, heritage and affordable housing grounds. On 26 March 2018 the Mayor of London intervened and took over the application. The applicant varied the scheme to increase the humber of homes and amount of affordable housing and the Mayor resolved to approve it on 18 September 2018 subject to completion of a section 106 agreement.

However, following representations by RBKC, the local residents group and Emma Dent Coad MP, the Secretary of State has issued a holding direction so that he can consider whether to call in the application for his own determination.

Kensington Forum Hotel

Another RBKC saga. An application by Queensgate Bow Propco Limited for the redevelopment of the Kensington Forum Hotel for “comprehensive redevelopment and erection of a part 30, part 22 and part 7 storey building comprising hotel bedrooms and serviced apartments (Class C1) with ancillary bar, restaurants, conferencing and dining areas, leisure facilities and back of house areas; residential accommodation (Class C3); with associated basement, energy centre, plant, car parking, cycle parking, refuse stores, servicing areas; associated highway works and creation of new publicly accessible open space with associated hard and soft landscaping“. The scheme included 46 homes.

On 27 September 2018 RBKC resolved to refuse planning permission – as with Newcombe House on townscape, heritage and affordable housing grounds. As with Newcombe House, the Mayor of London intervened and took over the application, on 5 November 2018.

This time however RBKC has issued proceedings for judicial review, seeking to quash the Mayor’s decision to take over the application. From the 7 December 2018 pre-action letter it appears that the grounds are (1) alleged errors of fact as to the number of homes which RBKC has recently delivered and (2) a failure to take into account RBKC’s programme for building new homes (including homes for social rent).

In the meantime it is reported that the Secretary of State has, again as with Newcombe House, issued a holding direction so that he can consider whether to call in the application for his own determination.

Getting messy isn’t it?

Simon Ricketts, 26 January 2018

Personal views, et cetera

The Purley scheme, image from inspector’s report

CIL The Merciless

Failing to serve a CIL notice can have huge consequences, as R (Shropshire Council) v Secretary of State (Mr C M G Ockleton, vice president of the Upper Tribunal, sitting as a High Court judge, 16 January 2019) illustrates.

Mr Jones, a self-builder, secured planning permission for a large new home with triple garage. Good news.

He received a liability notice for CIL assessing the amount of CIL that would be payable on commencement of the development as £36,891.43. Bad news.

He then applied for and secured full relief from CIL, relying on the self-building exemption. Good news.

In order not to lose the benefit of the relief, regulation 54B (6) provides that a “person who is granted an exemption for self-build housing ceases to be eligible for that exemption if a commencement notice is not submitted to the collecting authority before the day the chargeable development is commenced.”

You can see what is going to come next.

There was a section 106 agreement under which Mr Jones was obliged to notify the council when works pursuant to the planning permission were to begin, as the commencement date triggered a contribution of £9,000 under the agreement. Mr Jones sent the council an email with a heading referring to the section 106 agreement, notifying the council that works would commence the next day, which the council acknowledged, under the same heading.

Mr Jones didn’t send a separate commencement notice in the form required by the CIL Regulations.

The worst of news: he then receives a demand notice requiring the full £39,891.43 on the ground that the development had commenced without a commencement notice being sent to the council plus a surcharge of £2,500 for “invalid commencement“.

“Mr Jones responded with a letter of horror and apology, saying that he knew about the Regulations and thought that he had given sufficient notice of commencement by his email of 10 July. The relevant Council official replied in sympathetic terms but pointing out that the CIL process is separate from the planning process and is controlled very precisely by national regulations in relation to which the local authority had no discretion.”

Mr Jones, then instructed solicitors and counsel (good money after bad) and after various exchanges his representatives appealed against the demand notice (or rather a replacement demand notice that the council issued, given that the deadline for appealing against the first demand notice had passed).

Good news: The inspector allowed his appeal: the inspector “accepted that “on a literal interpretation of the Regulations” the email did not include particulars required by Form 6 (the form specified for the purpose under reg 67) and failed to identify the LN reference, but that the “oversight” was not fatal to Mr Jones’ case, because the email did refer to the relevant site and planning permission and unambiguously specified the intended date of commencement. In these circumstances, at para 10, he held that “in practice, substance, form and all intent and purposes the email communication has the same effect as Form 6”. He said he was content that “the purpose behind CIL reg 67 has been satisfied in spirit at least” and “the apparent failure to strictly comply with the terms of reg 67(2) should be put aside”. There was in any event no prejudice to the collecting authority because it was aware of the date.”

Alarm bells ring – “satisfied in spirit at least” when you are dealing with the CIL Regulations??

Bad news: the council challenges the appeal decision in the High Court and the Secretary of State consents to judgment, leaving poor Mr Jones to fight on. Potentially £40k+ down and now in High Court litigation, with exposure to paying the council’s legal costs if he loses.

Even worse news: the High Court finds for the council:

First, the email did not amount to a valid commencement notice because it did not comply with the requirements of regulation 67 (2, which requires that it must:

“(a) be submitted in writing on a form published by the Secretary of State (or a form to substantially the same effect);

(b) identify the liability notice issued in respect of the chargeable development;

(d) include the other particulars specified or referred to in the form.”

Secondly, the case law does “not justify a process of simply looking to see the apparent purpose of the regulations and treating any act fulfilling that purpose as sufficient to comply with them. The Regulations make perfectly clear that the consequence of failure to comply is loss of the exemption; and failure to comply means failure to submit a notice under reg 67.”

Finally the judge rejected the submission by Saira Sheikh QC “that in the circumstances of the present case the court should in its discretion refuse to grant relief to the Council. The requirements and the forms for fulfilling them are readily available, were made available to Mr Jones, and he accepted that he knew a commencement notice needed to be given. Only when the consequences of his failure were brought home to him in a substantial charge did Mr Jones claim that an email sent to the Council on an entirely different topic was his attempt to comply with the detailed requirements of which he was aware. There is no trace of any waiver or attempted waiver by the Council, and I do not see that Mr Jones could properly have interpreted the reply to his email in relation to s 106 as a waiver of the obligation to submit a commencement notice if he wished to maintain his self-build exemption. The argument based on the Inspector’s view that the Council should have told him (again) that he needed to submit a commencement notice is without merit: the Inspector was simply wrong about that. No system of administration could survive a duty imposed on a recipient of an email on one subject to remind its sender of all other notices on different subjects that he might want to send. The fact that the penalties are discretionary does not mean that the imposition of CIL itself is discretionary: it is not. The Council seems to have behaved as sympathetically as they could, imposing a minimum interest charge; and maintaining the imposition of the surcharge, in the absence of which Mr Jones would have no right of appeal. His difficulties have been caud maintaining the imposition of the surcharge, in the absence of which Mr Jones would have no right of appeal. His difficulties have been caused entirely by his own acts and I see no good reason to relieve him from the consequences at the expense of the ratepayers of Shropshire.”

What an unforgiving process this is. As commented by solicitor David Brock in a tweet when Town Legal circulated this case yesterday:

“The complications and traps of the CIL Regulations and self-builders are not really compatible. Which is odd given that Government encourages self- and custom-house building”

Of course, the Government will say that it already has proposals in hand to deal with injustices such as this, in its consultation document Reforming developer contributions: Technical consultation on draft regulations. In Mr Jones’ situation there would now be (once the draft regulations are finalised and in force) “a surcharge equal to 20 per cent of the notional chargeable amount or £2,500, whichever is the lower amount.”

Clearly, the proposals will assist but cases such as that of Mr Jones illustrate both the absurdly rigid nature of the system but also the curious approach of charging authorities, on the one hand sympathetic, but on the other hand going out of the way to take court proceedings to overturn an inspector’s decision that might be said to have arrived at a morally right outcome by the wrong legal reasoning (which would admittedly have created a terrible precedent). And as for that sentence in the judgment…

“His difficulties have been caused entirely by his own acts and I see no good reason to relieve him from the consequences at the expense of the ratepayers of Shropshire“.

First of all, whilst mercy is not possible under the regulations and it is difficult to see how the legal answer could have been any different, surely a little sympathy expressed for Mr Jones might have been appropriate and secondly, this betrays some degree of misunderstanding as to the modern system of local government finance and I wonder how much money from CIL receipts Shropshire Council already has sitting in its accounts, to which it now adds this windfall?

Simon Ricketts, 19 January 2019

Personal views, et cetera

PS Good news last week: obviously subscribe to Tom Dobson’s new blog, Man Plans God Laughs, last week’s piece being on that consultation document. (NB pic below is of Charles Middleton as Ming the Merciless – who would obviously have enjoyed CIL – rather than of Tom, where the relationship is more nuanced).

Section 106 Agreements & Public Procurement

Faraday v West Berkshire Council (Court of Appeal, 14 November 2018) is essential reading for those advising on development agreements between local authorities and developers: the fact that the developer has the benefit of an option as to whether to take an interest in the relevant land and carry out the development does not prevent the agreement from being treated as a public works contract. Quite a reversal from Holgate J at first instance.

For planners and planning lawyers advising on section 106 agreements, the case is more reassuring than for those struggling with development agreements. The Court of Appeal considered that the position in relation to development agreements was to be distinguished with that in relation to section 106 agreement. It expressed the position more firmly than the High Court had previously needed to in Midlands Co-Operative Society Ltd, R (on the application of) v Birmingham City Council and Tesco Stores Limited (Hickinbottom J, 16 March 2012).

The Midlands Co-Operative case concerned a deal reached between Birmingham City Council and Tesco for the redevelopment of land in Stirchley owned by the council on which there was an indoor bowls and community centre. Part of the arrangements between the council and Tesco included a section 106 agreement to provide and fit-out a replacement community centre and indoor bowls facility. The decisions to enter into a contract to sell the site and to use CPO powers to assist with assembly of the remainder of the development site were challenged by a competing developer, the Co-op, which asserted that the arrangements amounted to a public works contract and that that public procurement requirements had been breached.

Hickinbottom J rejected the challenge, on the basis that whilst the council had exchanged contracts to sell the land to Tesco there was no legally enforceable obligation on Tesco to carry out the works unless it chose to proceed. Whether it proceeded with the scheme was at its discretion.

“For those reasons, I do not consider that Tesco is now under any legally enforceable obligation to perform any relevant works that mean that the arrangements between it and the Council or any of them (including the contract for the sale of the Community Facility) fall within the scope of “public works contract” for the purposes of the 2006 Regulations; and, hence, the procurement provisions of those Regulations do not apply.

If there had been legally enforceable obligations to perform works, at least the three further potential issues would have arisen, namely (i) whether those obligations were mere planning obligations that would not invoke the provisions of the 2006 Regulations, (ii) whether the 2006 Regulations would not apply, because the main purpose of the arrangement was not the procurement of works, and (iii) whether the 2006 Regulations only give rise to private rights, such that a public law claim based upon them is inappropriate. In the light of my finding that the arrangement involved no legally enforceable obligation to perform works, those issues do not arise in this case; and it is unnecessary for me to consider them further.”

The Court of Appeal in Faraday rejected the notion that if the developer is not under a legally enforceable obligation there cannot be a public works contract. In the lead judgment, Lindblom LJ set out the court’s reasoning as follows:

“The touchstone, then, is whether, in substance, the agreement in question, at the date it is concluded, provides for a relevant procurement.

In this case, judged by that test, the development agreement clearly did provide, at the date it was entered into, for a procurement by the council of the development it was intended to deliver. At that date, no further act of procurement by the council remained to be done, for which a lawful public procurement procedure could later be conducted. The time for that had passed. When it entered into the development agreement, the council had nothing more to do to ensure that a “public works contract” would come into being. It had, in fact, done all that it needed to do to procure. It had committed itself contractually, without any further steps being required of it, to a transaction that will fully satisfy the requirements of a “public works contract”. It had committed itself to procuring the development from St Modwen. The development agreement constitutes a procurement in its result, and a procurement without a lawful procurement procedure under the 2004 Directive and the 2006 regulations. The procurement crystallizes when St Modwen draws down the land. The ground lease entered into by St Modwen will contain an unqualified obligation to carry out works, and a corresponding obligation will also be brought into effect in the development agreement itself. The development agreement made that commitment on the part of the council final and provided also for a reciprocal commitment on the part of St Modwen. It did so without a public procurement process, and without affording any opportunity for such a process to be gone through before the “public works contract” materializes. At that stage it would be too late. Thus a “public works contract” will have come into being without a lawful procurement process. The regulation of the council’s actions in procuring the development will have been frustrated.

By entering into the development agreement, therefore, the council effectively agreed to act unlawfully in the future. In effect, it committed itself to acting in breach of the legislative regime for procurement. As Mr Giffin submitted, that is in itself unlawful, whether as an actual or anticipatory breach of the requirements for lawful procurement under the 2004 Directive and the 2006 regulations, or simply as public law illegality, or both. The only other possibility would be that a contracting authority is at liberty to construct a sequence of arrangements in a transaction such as this, whose combined effect is to constitute a “public works contract”, without ever having to follow a public procurement procedure. That would defeat the operation of the legislative regime.”

Whilst it was not necessary to deal with the point for the determination of this case, Lindblom LJ was careful not to suggest that this meant that the section 106 agreement in the Midlands Co-Operative case would on his reasoning have amounted to a public works contract:

“The section 106 planning obligation was […] a very different kind of agreement. It had a distinct status and role in the statutory planning scheme. Its purpose was to regulate the development of land for which the local planning authority was granting planning permission. By its terms the developer, and its successors in title, would not be able lawfully to proceed with the development for which planning permission was granted, and in particular would not be able to demolish the existing community facilities on the development site, until it had constructed replacement facilities. The section 106 agreement did not oblige the developer to proceed with the development. But in any case it was not the kind of transaction that is governed by the public procurement regime. By its very nature, it was not a “public works contract”. Its essential object – and its necessary justification in the interests of the proper planning of the local planning authority’s area – was to ensure that the community facilities would be replaced if the planning permission were implemented. Otherwise, the proposed development itself would not have been acceptable, and planning permission should not have been granted for it. As Hickinbottom J. said (in paragraph 116 of his judgment), “the council’s primary objective was of a planning nature – to develop the Site – rather than having performed the works involved in replacing the community facility”. In this case, by contrast, when it entered into the development agreement, the council was not exercising any of the functions of a local planning authority under the statutory planning scheme. It was entering into a contract whose essential object was the execution of the works for which it provided. It therefore fell within the scope of the public procurement regime.”

That is an important paragraph, because if obligations on developers in section 106 agreements to carry out works were to trigger public procurement requirements, the whole practice of using planning obligations to achieve acceptable development would rapidly have come to a halt. Instead, we have clarity that there is not a problem.

Good news. And also good news that as a planning lawyer I may not now need to focus so much on the Public Procurement (Amendment etc.) (EU Exit) Regulations 2019 – laid before Parliament on 13 December 2018 and prepared with the objective of continuing the current public procurement regime post Brexit.

Simon Ricketts, 12 January 2019

Personal views, et cetera

PS Some chat about the lawyers involved in these cases:

Leading counsel for the unsuccessful claimant in Midlands Co-Operative was David Holgate QC, as he was back in 2012 – and the position as a judge he later took at first instance in Faraday was very much in line with the approach that Hickinbottom J had taken in Midlands Co-Operative in the face of Holgate’s submissions – no legally binding obligation on the part of the developer, therefore no public works contract.

Junior counsel for the city council in Midlands Co-Operative was a very young Charlie Banner, who deservedly becomes Charles Banner QC on 11 March 2019. He was led in Midlands Co-Operative by David Elvin QC, whilst in Faraday Banner would appear for the claimant (and at first instance was given some of the treatment from Holgate that in Midlands Co-Operative Holgate had himself received from Hickinbottom) (with Elvin appearing on the other side for the defendant council).

Photograph via Sothebys

Street Trees

DEFRA published its Protecting and enhancing England’s trees and woodlands consultation paper on 30 December 2018, with a deadline of 28 February 2019 for responses. The proposals include imposing new statutory duties on local authorities:

⁃ “a duty to consult on the felling of street trees”

⁃ “a duty to report on tree felling and planting”

Presumably these are intended to be included in the forthcoming Environment Bill and they could justifiably be known as “Sheffield’s Law”. After all they of course have their roots in the peculiar saga there, where the city council and its PFI contractor Amey have been engaged in systematic felling of roadside trees at an unprecedented scale.

I reported in my 17 December 2016 Trees In Court: A Festive Special blog post on the the late Gilbart J’s rejection, in R (Dillner) v Sheffield City Council (27 April 2016) of a local resident’s challenge to that process. The judge commented: “It may be that those who will be disappointed by the terms of this Judgment will want to see a different legislative regime in place. That is a matter for Parliament, and not for this Court.

The continued felling led to significant protests, with arrests, curiously, made under section section 241 of the Trade Union and Labour Relations Act 1992. (The Independent Office for Police Conduct subsequently found in August 2018 that the arrests and detention were inappropriate and in December 2018 compensation payments were awarded).

The commitment in the Conservative Party’s manifesto in May 2017 surely specifically had the Sheffield situation in mind:

“In addition to the 11 million trees we are planting across our nation, we will ensure that 1 million more are planted in our towns and cities, and place new duties on councils to consult when they wish to cut down street trees.” (my emboldening).

On the back of the Gilbart J ruling, an injunction in relation to continuing protests was ordered by Males J in Sheffield City Council v Fairhall and others (15 August 2017) in the following terms:

“Accordingly I order that the three remaining named defendants must not:

1.
(1) enter any safety zone erected around any tree within the area shown edged red on the plan which will be attached to the order (the area of Sheffield City);
(2) seek to prevent the erection of any safety zone;
(3) remain in any safety zone after it is erected;
(4) knowingly leave any vehicle in any safety zone or intentionally place a vehicle in a position so as to prevent the erection of a safety zone; or
(5) encourage, aid, counsel, direct or facilitate anybody else to do any of the matters in paragraphs 1 – 4 above including by posting social media messages.

2. There will in addition be an order in the same terms against persons unknown being persons intending to enter or remain in safety zones erected on public highways in the city of Sheffield. Such an order is appropriate in accordance with the principle established in Hampshire Waste Services Ltd v Intending Trespassers upon Chineham Incinerator Site [2003] EWHC 1738 (Ch).”

Like Gilbart J, Males J distanced himself from the wider issues:

“I must emphasise that this judgment deals solely with the legal question whether the council is entitled to an injunction. That will include consideration of whether as a matter of law the council is entitled to exclude members of the public from safety zones around trees so that those trees can be felled and whether or to what extent those who object to this course are entitled to maintain a presence within safety zones in order to prevent the work from being carried out. However, I express no view, one way or the other, as to the merits of the council’s tree felling programme or the objectors’ campaign. Those are social and environmental questions which are politically controversial and can only be resolved in a political forum. They are not a matter for this court”

Following the June 2017 general election, Michael Gove had of course been brought back into the Cabinet as Secretary of State for Environment, Food and Rural Affairs. In March 2018 he was reported by the BBC as having “accused Sheffield City Council of “environmental vandalism” and promised to do “anything required” to end its controversial tree-felling programme.”

Felling paused the day after, although the city council renewed its injunction in July 2018, by way of a High Court ruling (His Honour Judge Robinson, 12 July 2018)

The Yorkshire Post reported on 13 December 2018 that the city council now announced a revised tree management strategy, reducing significantly the amount of felling proposed.

So back to the DEFRA consultation proposals.

‘Street trees‘ are defined as “managed trees lining the highway within the urban environment“. The duty to consult would not apply to other urban trees such as parks or open spaces.

The idea is that the “local authority” (presumably the local highway authority, although this is not made clear – eg presumably TfL in London in relation to the TfL network?) would consult “on every tree proposed for felling during a four week closed consultation period. A notice inviting consultation to be placed on the tree, letters sent to local residents in close proximity to the tree (100m2). If more than 50% of respondents in the closed consultation disagree with the proposal this will trigger a full public consultation.” Full consultation appears to mean “a notice published in the town hall and online“.

Is this workable? Assuming that there would often need to be a full consultation process, how long would this all take, bearing in mind that the consultation responses would then need to be conscientiously considered by the authority, presumably at a relevant committee meeting held in public with officer’s report and so on, before a legally robust decision could be taken?

There would be exemptions, the scope of which could well lead to dispute:

“1. Dangerous: Tree needs to be felled because it presents an immediate danger and work is urgently needed to remove that danger. Trees that immediately affect the operational use of the footway by people – forcing them to use the carriageway – are considered dangerous for the purposes of this policy.

2. Responding to a pest or disease instance:Removal of a tree is a critical partof the implementation of a management or control programme, following notification by regulatory authority in response to a pest or disease instance.

3. Dead.

4. Damaging:Tree needs to be felled because it is causing significant damage to
the apparatus of a statutory undertaker (such as gas, electricity or water) where urgent access is required for repair; or tree needs to be felled because it can be demonstrated that it is causing significant damage and threatens the integrity of a footpath or carriageway to such an extent that it presents an imminent danger.

5. Young Trees Damaged/Failed:Young trees (up to fifteen years old) which will be replaced within two years. The position of the tree has already been established. Consultation could lead to discussion that undermines that decision when replacement is essentially a maintenance management activity”

There is a further complication:

“Trees designated as having special historic or cultural significance would automatically be subject to wider public consultation. To meet this definition trees would have to meet one of the following criteria. The tree may be:

• culturally, historically, ecologically significant – such as veteran trees

• linked to a person or event that is culturally or historically significant
For trees that meet this criteria an extraordinary measure/action or level of resource can be taken or dedicated to its preservation. The local authority may initially be unaware of this significance so a full consultation where significance is suspected or raised as an issue is essential.”

So yet again we are faced with quite a complex, or at least fiddly and fine grained, regime to deliver on a superficially nice idea – and to what end? If Sheffield City Council had followed these procedures the outcomes could well have been the same.

I also find it strange that there is no mention in the document of the town and country planning regime, for example the role of tree preservation orders and the protection provided to trees in conservation areas. Would not amendments to the planning regime not have been more logical?

The separate proposed duty to report on tree felling and replanting raises a further issue. The document is silent about the intended frequency of reporting but let’s assume it is to be annual. This reporting will not just cover street trees but will be much wider:

“Local authorities would be required to record on felling and planting activity for which they are both directly and indirectly responsible, including trees which are felled as part of planning decisions.”

So could we see “local authorities” (by which I assume is meant local highway authorities) have to collect data as to how many trees are to be felled as a result of planning decisions by the local planning authority (that are not even on highway land), or will this only apply to unitary authorities? More thinking required!

I have managed to avoid mention of the separate, much more complex, set of proposals within DEFRA’s other current consultation, on biodiversity net gain (2 December 2018). That also has some major potential implications – these days planners’ eyes need to be on DEFRA as much as MHCLG it seems to me.

Simon Ricketts, 5 January 2019

Personal views, et cetera

Photo courtesy of the Woodland Trust

Some Blog Post Postscripts

I’m conscious that these posts (this is the 149th) sometimes don’t age well – they try to capture a point in time and I don’t go back to change them unless I’ve got something really wrong or, worse still, there’s a misplaced apostrophe (they’re written on an ipad, on a train or at the kitchen table, as fast as my two fingers can move, so bear with).

So I thought I’d take the opportunity to note a few post-post updates…

CIL

Since my 15 December 2018 CIL Life post, the claimant in Giordano has applied to the Court of Appeal for permission to appeal, having been refused it by Lang J. Will 2019 see the Court of Appeal grapple for the first time with the joys of CIL liability?

Since my 9 November 2018 An Update On CIL: Reform Promised, Meanwhile Continuing & Increasingly Expensive Uncertainties post the Government published Reforming developer contributions: technical consultation on draft regulations (20 December 2018). The purpose of the consultation is to “ensure that the draft regulations deliver the intended policy changes and do not give rise to unforeseen consequences.” The consultation runs until 31 January 2019. Supporting guidance will accompany the final regulations.

As well as delivering on the proposals announced in October 2018 (I assume – I haven’t yet worked through some of the algebraic amendments), the draft regulations exempt starter homes from the levy, where the dwelling is sold to individuals whose total household income is no more than £80,000 (£90,000 in central London). The draft regulations also make a number of other clarifications to address various glitches.

The Trinity One litigation

My 8 September 2018 What If? The Trinity One Case post commented on a situation where a developer had sought to resist a claim for an affordable housing commuted payment on the ground that the basis for calculating the payment, the Total Cost Indicator figures previously published by the Housing Corporation, had ceased to exist. I mentioned that the position could change as a result of separate litigation underway in relation to the developer’s attempt to reduce its section 106 liability by way of the section 106BA/BC procedure.

Well, the position did indeed then change as a result of R (City of York Council) v Secretary of State (Kerr J, 22 October 2018). The case is of little general interest now given that it concerns the mechanism whereby developers could apply for modification or discharge of affordable housing obligations in a section 106 agreement on the basis that modification or discharge was required to achieve an economically viable development, which mechanism was brought to an end on 30 April 2016. But it will have been immense interest to the parties. Kerr J accepted Trinity One’s position that (1) its appeal against refusal of its section 106BA application was not out of time because it was sufficient for the application to have been made by 30 April 2016 and (2) the application could be made even after the development had been completed.

Land value capture

My 31 August 2018 Market Value Minus Hope Value = ? post was written whilst the House of Commons Communities and Local Government Select Committee was taking evidence in relation to its land value capture inquiry. The committee reported on 13 September 2018 and the Government’s response was published on 29 November 2018.

The Committee urged that the Government should consider appropriate mechanisms:

“Our view is that there is scope for central and local government to claim a
greater proportion of land value increases through reforms to existing taxes and charges, improvements to compulsory purchase powers, or through new mechanisms of land value capture.”

However, the response is a classic straight bat:

“The Government agrees that there is scope for central and local Government to claim a greater proportion of land value increases. The Government’s priority is delivery, in line with the Housing Minister’s commitments to provide more higher quality housing more quickly.

Changes to land value capture systems can have profound impacts on the land market in the short term, even where they are sensible for the longer term. Accordingly, the Government’s priority is to evolve the existing system of developer contributions to make them more transparent, efficient and accountable. It will of course continue to explore options for further reforms to better capture land value uplift, providing it can be assured that the short-run impact on land markets does not distract from delivering a better housing market.”

Raynsford Review

My 9 June 2018 Judicious Review post commented on the interim report published by the Raynsford Review. The final report was published on 19 November 2018.

Public procurement

Finally, a long time ago, in my 6 September 2016 section 123…Go! post, I commented on Holgate J’s ruling in Faraday. That judgment has now been overturned in R (Faraday Development Limited) v West Berkshire Council (Court of Appeal, 14 November 2018) – see the Landmark Chambers summary.

2019

Plenty happened in planning law in 2018, despite much political focus being away from domestic issues. What will 2019 bring? Feel free to subscribe to this blog to get one quick take a week on what seems interesting to me at least. (And, shameless plug, do subscribe as well to Town Legal’s weekly updates of planning law cases and/or of Planning Inspectorate appeal decision letters).

Here’s to another year.

Simon Ricketts, 28 December 2018

Personal views, et cetera

The Office For Environmental Protection

“And through it all the Office for Environmental Protection

A lot of love and affection

Whether I’m right or wrong..”

The Secretary of the Environment, Food and Rural Affairs, Michael Gove, presented the draft Environment (Principles and Governance) Bill to Parliament on 19 December 2018.

It is important that we understand the new regime that is proposed and start to form views as to whether it is fit for purpose, given that (1) its provisions will replace the environmental protections currently provided by way of EU law and that (2) it would be unfortunate if any new system were to introduce additional uncertainties, unnecessary requirements or causes of delay. What will the implications be for the English planning system?

Having said that we don’t yet have the full picture.

First, because (following a commitment given by the prime minister in July 2018) this draft Bill is going to be rolled into a wider Environment Bill in 2019 which, according to the draft Bill’s foreword by Michael Gove, “will contain specific measures to drive action on today’s crucial environmental issues: cleaning up our air, restoring and enhancing nature, improving waste management and resource efficiency, and managing our precious water resources better.”

Secondly, because this draft Bill does not yet include the Government’s commitment in the withdrawal agreement to “non regression” from current EU environmental laws (see my 16 November 2018 blog post Big EU News! (Latest CJEU Case on Appropriate Assessment & A Draft Withdrawal Agreement))although of course we wait to see what happens to that agreement, yet to be approved by Parliament.

Thirdly, because the provisions in the draft Bill are a framework for more detail to come forward by way of, for instance, a Government policy statement on environmental principles and a strategy to be prepared by the proposed Office for Environmental Protection setting out how it intends to exercise its functions. More on this later. What this draft Bill does do is discharge the requirement in section 16 of the EU (Withdrawal) Act 2018 for draft legislation to be published setting out the way in which environmental principles will be maintained post-Brexit, and the statutory body that will be established to police them (see my 18 September 2018 blog post Planning, Brexit).

Deal or no deal?

The intention is that this new legal regime should in place ready for when we leave the jurisdiction of EU law. Whilst if we have a withdrawal agreement this will be at the end of any transition period, we could be left with a potential hiatus in the case of a “no deal” Brexit. If there’s no deal there will be more urgently newsworthy issues than the implications of that situation for the environment (it was noteworthy that the publication of the draft Bill last week attracted no real attention from the mainstream media as far as I could see) but this was rightly a matter of concern for the House of Commons Environmental Audit Committee in its report on the Government’s 25 Year Plan for the Environment, to which the Government in its 6 November 2018 Response said this:

“Government is confident of leaving the EU with a deal on an implementation period, which the EU has also confirmed it would like to agree. However, we are stepping up preparations within government and Defra to make sure that a new statutory body is in place as soon as is practically achievable in the event of a no deal exit, with the necessary powers to review and, if necessary, take enforcement action in respect of ongoing breaches of environmental law after the jurisdiction of the CJEU has ended. This will mean that the Government will be held accountable as under existing EU law from the day we leave the EU.

As mentioned previously, the EU (Withdrawal) Act will ensure existing EU environmental law continues to have effect in UK law after exit, providing businesses and stakeholders with maximum certainty as we leave the EU. Until the new body is in place, for example, existing mechanisms will continue to apply: the Parliamentary Ombudsman will process complaints about maladministration; and third parties will be able to apply for Judicial Review against government and public authorities.”

The draft Bill

If you click into the draft Bill – and please do because this blog post is not a complete summary – you will see that the draft legislation itself (34 clauses and a schedule) is sandwiched between:

⁃ Michael Gove’s foreword – the first paragraph will give you an idea of the tone:

“Leaving the European Union is a once-in-a-lifetime opportunity for this country to help make our planet greener and cleaner, healthier and happier. We are seizing this chance to set a new direction for environmental protection and governance, in line with the government’s ambition to leave our environment in a better state than we inherited it.”

⁃ A long set of explanatory notes which include an explanation of the policy and legal background as well as a detailed commentary on the provisions of the draft Bill, including much by way of statements of what is intended that is absent from the draft Bill itself.

The foreword describes the two main strands of the draft Bill (although in the reverse order to how they are actually dealt with).

“Firstly, we will establish a world-leading, statutory and independent environment body: the Office for Environmental Protection (OEP). This body will scrutinise environmental policy and law, investigate complaints, and take action where necessary to make sure environmental law is properly implemented.

Secondly, we will establish a clear set of environmental principles, accompanied by a policy statement to make sure these principles are enshrined in the process of making and developing policies”

Definitions

The “environment” can often have a broad meaning.

For instance in the Environmental Impact Assessment Directive the following factors need to be addressed in environmental impact assessment:

“(a) population and human health;
(b) biodiversity, […];
(c) land, soil, water, air and climate;
(d) material assets, cultural heritage and the landscape;

(e) the interaction between the factors referred to in points (a) to (d).”

However, in the draft Bill a much narrower definition is adopted:

“31 (2) Environmental matters are—

(a) protecting the natural environment from the effects of human activity;

(b) protecting people from the effects of human activity on the natural environment;

(c) maintaining, restoring or enhancing the natural environment;

(d) monitoring, assessing, considering, advising or reporting on anything in paragraphs (a) to (c).”

So this is just about the “natural environment“, defined in clause 30 as

“(a) wild animals, plants and other living organisms,

(b) their habitats,

and the natural systems, cycles and processes through which they interact.”

“Environmental law” is even narrower, as it is defined as any legislative provision (other than legislation devolved to the Scottish Parliament, Welsh Assembly or, without the Secretary of State’s consent, the Northern Ireland Assembly) that is mainly concerned with an environmental matter and that is not concerned with an excluded matter – excluded matters are:

⁃ greenhouse gas emissions;

⁃ access to information;

⁃ the armed forces, defence or national security;

⁃ taxation, spending or the allocation of resources with government.

The Secretary of State can by regulations specify specific legislative provisions as falling within or outside the definition of “environmental law“.

The explanatory notes to the draft Bill say that, based on these provisions “most parts of legislation concerning the following matters, for example, would normally be considered to constitute environmental law:

⁃ air quality (although not indoor air quality);

⁃ water resources and quality;

⁃ marine, coastal or nature conservation;

⁃ waste management;

⁃ pollution;

⁃ contaminated land.

They go on to assert that the following matters would not normally constitute environmental law:

⁃ forestry;

⁃ flooding;

⁃ navigation;

⁃ town and country planning;

⁃ people’s enjoyment of or access to the natural environment;

⁃ cultural heritage;

⁃ animal welfare or sentience;

⁃ animal or plant health (including medicines and veterinary products);

⁃ health and safety at work.

“”Environmental principles” means the following principles—

(a) the precautionary principle, so far as relating to the environment,

(b) the principle of preventative action to avert environmental damage,

(c) the principle that environmental damage should as a priority be rectified at source,

(d) the polluter pays principle,

(e) the principle of sustainable development,

(f) the principle that environmental protection requirements must be integrated into the definition and implementation of policies and activities,

(g) the principle of public access to environmental information,

(h) the principle of public participation in environmental decision-making, and

(i) the principle of access to justice in relation to environmental matters”

What the Secretary of State must do

The draft Bill provides that Secretary of State must prepare a policy statement on environmental principles. “The statement must explain how the environmental principles are to be interpreted and proportionately applied by Ministers of the Crown in making, developing and revising their policies.” It may also explain how ministers, “when interpreting and applying the environmental principles, are to take into account other considerations relevant to their policies.” Ministers must “have regard” to the policy statement “when making, developing or revising policies dealt with by the statement“. Nothing in the statement shall require a minister to take (or to refrain from taking) any action if it “would have no significant environmental benefit” or “would be in any way disproportionate to the environmental benefit“.

Wow! Regardless of how robust or otherwise the policy statement turns out to be, count the get-outs in that last paragraph.

The draft Bill also provides that the Secretary of State must prepare an environmental improvement plan. The first one will be the current document entitled “A green future: our 25 year plan to improve the environment” (11 January 2018). It must be kept under review, with the next to be completed by 31 January 2023 and thereafter at least every five years.

The Office for Environmental Protection

Details of the membership, staffing and functions of this new body are set out in the schedule to the draft Bill.

The Office for Environmental Protection would monitor and report on environmental improvement plans, monitor the implementation of environmental law, and advise on proposed changes to environmental law. It would also have an important enforcement role.

It must prepare a strategy setting out how it intends to exercise its functions, including its complaints and enforcement policy, having regard to “the particular importance of prioritising cases that it considers have or may have national implications, and the importance of prioritising cases—

(a) that relate to ongoing or recurrent conduct,

(b) that relate to conduct that the OEP considers may cause (or has caused) significant damage to the natural environment or to human health, or

(c) that the OEP considers may raise a point of environmental law of general public importance.”

The explanatory notes suggest that individual planning decisions will not be a focus of the OEP’s attention:

“The definition of national implications will be for the OEP to determine, but this provision is intended to steer the OEP to act in cases with broader, or more widespread significance, rather than those of primarily local concern. For example, an individual local planning or environmental permitting decision would not normally have national implications, whereas a matter with impacts or consequences which go beyond specific local areas or regions could have.

Anyone except public bodies can raise a complaint with the OEP where a public authority has failed to comply with environmental law. The public authority’s internal complaints procedure must first have been exhausted. The explanatory notes state:

“A wide range of bodies including the Environment Agency, Natural England and the Planning Inspectorate, for instance, operate complaints procedures which will apply to their functions concerned with the implementation of environmental law.”

Complaints must be made within a year of the failure complained of, or within three months of when any internal complaints procedure was exhausted. The OEP “may” carry out an investigation if in its view the complaint indicates that the authority has failed to comply with environmental law and “the failure is serious“. It must provide to the authority a report as to whether it considers that the authority has failed to comply with environmental law, its reasoning and recommendations (whether for the authority or generally) in the light of its conclusions. There will be a process of information notices and decision notices. The authority receiving a decision notice must respond within two months or such later timescale is given, setting out whether it agrees with the notice and what steps it intends to take.

There is then a curious clause, clause 25, which deals with enforcement. Within three months of the deadline for the authority responding to the decision notice, the OEP can make an application to the High Court for judicial review. After any such proceedings, the relevant authority must publish a statement “that sets out the steps (if any) it intends to take in light of the outcome of those proceedings“.

So what would these proceedings seek to achieve? A declaration from the court or something more, some kind of enforcing order? Would the authority’s decision that is the subject of the complaint be liable to be quashed? If so, plainly concerns arise that decisions will no longer be able to be safely relied upon by parties where the usual judicial review period has expired – it would be worrying if decisions could be at risk for much longer via this elongated OEP complaints procedure.

Concluding thoughts

Without seeing the rest of what will be in the eventual Environment Bill, and without see the nature of any “non regression” commitment (if indeed it survives the current politics), I’m left feeling entirely unclear what practical role the mechanisms in the draft Bill will really have. There are certainly numerous questions:

⁃ Are the definition of environmental matters and environmental law too narrow?

⁃ Will the policy statement on environmental principles either be too weak or alternatively extend its reach into other regimes, for instance leading to the risk of causing confusion as to the application of principles set out in the National Planning Policy Framework?

⁃ Are there too many get-outs on the part of Government?

⁃ Will the OEP really be able to influence the Government’s approach when it comes to politically contentious issues? The Committee on Climate Change has not been a good precedent.

⁃ Is there confusion as to the role of the OEP when it comes to investigating possible breaches of environmental law, in that surely this is a matter for existing enforcement bodies such as the Environment Agency and for the courts?

And whilst from the explanatory notes the intention appears to be that this regime would not directly affect town and country planning, in reality matters such as environmental impact assessment, strategic environmental assessment and the treatment of protected nature conservation sites are central to the planning process, so it seems to me that unfortunately this isn’t a debate that planners and planning lawyers can ignore.

Simon Ricketts, 22 December 2018

Personal views, et cetera

CIL Life

One of the many frustrating aspects of the Community Infrastructure Levy regime is the confusing and limited nature of any right to appeal, which is particularly concerning given the varying interpretations given to the Regulations by different collecting authorities.

The first difficulty is working out what the appeal route in any particular situation is.

Appeals lie to the Valuation Office Agency in relation to:

⁃ Regulation 114 (where an interested person has asked the collecting authority for a review of the chargeable amount as is aggrieved at the decision on the review)

⁃ Regulation 115 (apportionment of liability)

⁃ Regulation 116 (charitable relief)

⁃ Regulation 116A (exemption for residential annexes)

⁃ Regulation 116B (exemption for self-build housing).

Recent VOA appeal decisions are here.

Appeals lie to the Planning Inspectorate in relation to:

⁃ Regulation 117 (decisions by the collecting authority to impose a surcharge)

⁃ Regulation 118 (determinations by the collecting authority of a deemed commencement date)

⁃ Regulation 119 (imposition by the collecting authority of a CIL stop notice).

Recent Planning Inspectorate appeal decisions are here.

A common theme in relation to the VOA and PINS appeals decisions is the frequency of misunderstandings as to the CIL regime on the part of those carrying out minor developments, the frequency of notices being missed or overlooked and forlorn attempts to avoid or reduce liability at a stage when development has already commenced and the horse has bolted.

Appeals can then proceed to the High Court if either of the parties considers that the decision of the VOA or PINS was wrong in law.

In relation to decisions of the collecting authority which are not listed above, for instance as to whether any exemption or relief should be granted other than charitable relief, the exemption for residential annexes and self-build housing – say social housing relief – the only possibility for challenge is for by way of an application to the High Court for judicial review. Not only is that a disproportionately cumbersome route for challenge when the issue could surely be dealt with by the VOA or PINS but, given that the possibility for claiming a relief or exemption is lost if it is not granted before development is commenced, few developers have the luxury of being able to wait for resolution of a disagreement over the relief or exemption before starting construction.

Surely all of this needs looking at again and simplifying as part of the Government’s current review.

I started thinking about all of this when reading what may be only the third High Court ruling in relation to CIL liability issues, R (Giordano Limited) v London Borough of Camden (Lang J, 13 December 2018). It’s a pretty straightforward case but I’m still not sure whether there was a VOA decision (and if not why the challenge was allowed to proceed) – maybe someone out there can help?

The issue was whether, in determining the relevant floorspace within the chargeable development, the test in Regulation 40 (7) (ii) was met as to whether there were “retained parts where the intended use following completion of the chargeable development is a use that is able to be carried on lawfully and permanently without further planning permission in that part on the day before planning permission first permits the chargeable development.” The floorspace represented by such parts wouldn’t attract CIL.

The claimant was intending to implement a planning permission for “change of use of third floor offices (class B1a) and vacant first and second floors (class B8) to create 3 x three bedroom flats.” Having received a liability notice for £547,419.09, it argued that the test was met because there was a previous planning permission which had been lawfully commenced for “change of use of third floor offices (class B1a) and vacant first and second floors (class B8) to create 6x two-bedroom flats (class C3), including rear extensions at first, second, third and fourth floors and associated external alterations.”

Under the previous (pre-CIL) permission, the rear extension and alterations to the elevations of the building had been completed, and steel beams refitted internally, but the first, second and third floors were just stripped out, unpartitioned floors and were not yet capable of being used for residential purposes.

The claimant was attempting to rely on the floorspace deduction provided for in Regulation 40 (7) (ii) because it couldn’t show that any part of the building had been lawfully occupied for at least six months in the previous three years.

Lang J found that because the floorspace was currently incapable of being used for residential purposes it did not meet the test – a “potential” future use was not sufficient.

Stepping back, I would say that was a pretty large windfall for the local authority!

The only other two High Court cases I’m aware of are:

R (Orbital Park Swindon Limited) v Swindon District Council (Patterson J, 3 March 2016), where the claimant succeeded in mitigating its potential CIL liability by securing two separate planning permissions for its proposed works to a retail store, one of which permissions, for the introduction of additional space by way of a mezzanine, was not liable for CIL.

Patterson J had no difficulty with the deliberate CIL mitigation strategy adopted:

“There is […] no manipulation of the system for any ulterior and/or illegal motive in accordance with the submissions of the defendant. Rather, the claimant has taken advantage of the legislative scheme which permits it to submit, in this case, two separate planning applications for each act of operational development that it wished to pursue. If it was not the intention of the legislature to permit that to occur then it is for the legislature to change it. At present, in my judgment, that is the consequence of the current statutory scheme.”

R (Hourhope Limited) v Shropshire Council (HHJ David Cooke, 2 March 2015), where the claimant failed in its submissions that the “in lawful use” requirement for deduction of floorspace would be met by anything less than actual use – it was not sufficient that the building (a former pub) was still available for lawful occupation, or that there was some residual storage of items left behind from when the pub had closed.

Is anyone aware of any others?

MCIL2

While talking about CIL, I thought it might be worth a brief post script about the Mayor of London’s MCIL2 (previously covered in part of my 9 November 2018 blog post An Update On CIL: Reform Promised, Meanwhile Continuing & Increasingly Expensive Uncertainties). The report of the examiner, Keith Holland, has now been published, recommending, with one minor modification, that the submitted charging schedule is appropriate, meaning that we can expect it to be adopted and take effect on 1 April 2019.

Despite the increasingly big question mark that there must be over whether Crossrail 2 (the basis for MCIL2) is politically deliverable at present (see my 1 July 2017 blog post Crossrail 2, Where Are You?) Mr Holland has no difficulty on that score:

“In 2016 the National Infrastructure Commission recommended that Crossrail 2 be taken forward as a priority with the aim of opening in 2033. Costings for the project have recently been subject to an independent review. The results of the review are not yet public and at this stage there is no formal government approval for Crossrail 2. However, the need for new infrastructure to support the region’s growth was endorsed by the Secretary for State for Transport in July 2017 and there is no doubt that an extremely strong case can be made for Crossrail 2. Moreover, there is general endorsement for Crossrail 2 from those making representations.”

Of course many of us want to see Crossrail 2 proceed. But what if it doesn’t? That’s a lot of money being raised without a defined objective as to the transport projects to which it is to be applied and surely it would be wrong for it to end up being used, for instance, to address cost overruns in relation to Crossrail 1?

Simon Ricketts, 15 December 2018

Personal views, et cetera

Charles Alfred Meurer, Still life with money, pipe and letters, 1914

Permitted Development: Painting By Numbers Versus Painting The Sistine Chapel?

Time now to look at some of the proposals to extend permitted development rights and to amend the Use Classes Order that are set out in the Planning Reform: Supporting the high street and increasing the delivery of new homes consultation paper published alongside the Autumn budget on 29 October 2018, and strongly criticised in Nick Raynsford’s final review of planning in England (November 2018):

“The government’s announcement of its intention to extend even further this permissive ‘shadow’ planning process appears to reflect its model for the future direction of the system; and this has real implications for people and for the nature of both planning and planners. This reflects the tension recorded in evidence presented to the Review as to whether planning is a form of land licensing, which implies one set of skills and outcomes, or the much more complex and creative practice of shaping places with people to achieve sustainable development. The former task is like painting by numbers; the latter is like painting the Sistine Chapel. The difference in outcomes for people is equally stark.”

I’m not sure that sort of language (describing traditional planning applications as equivalent to painting the Sistine Chapel, a spectacularly inapt comparison, or indeed TCPA interim chief executive Hugh Ellis’ language in the accompanying press release: “‘Permitted development is toxic and leads to a type of inequality not seen in the Britain for over a century.“) is helpful to the debate.

It seems to me that the two key issues which need to be addressed in relation to permitted development rights that enable additional residential development (whether by way of conversion or construction) are the need for some control at a national or local level over room sizes and the need to provide a proportion of affordable housing whether on site or by way of financial contribution. Aside from those obvious issues (not addressed in the latest consultation paper), what is wrong with the Government looking to streamline development management processes where appropriate? Surely the question is where is the appropriate dividing line. Surely deemed planning permission should be for types of development where, given the public benefit in seeking to encourage them, the local planning authority should not need to question the principle of what is proposed up to a defined scale at a particular location (with more general powers to restrict rights available by way of Article 4 Direction) and where wider issues do not arise that cannot be resolved within a 56 day period for prior approval of specified aspects which are, as far as possible, not open to differing subjective views? Don’t we need to define some sort of principle along these lines before then considering different common types of development?

“Allow greater change of use to support high streets to adapt and diversify”

The Government proposes that uses in classes A1 (shops), A2 (financial and professional services), and A5 (hot food takeaways) (as well as uses as betting shops, pay day loan shops and laundrettes) should be allowed to change to “office use (B1)” (do they mean “office use” or do they mean B1 which also encompasses light industrial and R&D?). Hot food takeaways will be allowed to change to residential use (C1) as is already the case with the other uses referred to. There would be the requirement for prior approval, as with existing change of use permitted development rights.

Alongside this, the current “pop up” temporary permitted development rights to change the use from shops (A1) financial and professional services (A2), restaurants and cafes (A3), hot food takeaways (A5), offices (B1), non-residential institutions (D1), assembly and leisure uses (D2), betting shops and pay day loan shops to change to shops (A1) financial and professional services (A2), restaurants and cafes (A3) or offices (B1) will be extended from two years to three years. The temporary permitted development rights are proposed now to extend to changes to certain community uses, namely as a public library, exhibition hall, museum, clinic or health centre.

All of these proposals are put forward in the context of “supporting the high street” but no geographical limitation to the proposed changes is indicated that would prevent their application to any building in the relevant use, wherever it is located – shades of the original proposal in relation to the office to residential permitted development right, which was couched in terms of underused and empty office premises, when of course the right turned out not to have any such limitation. There is no indication of any floorspace cap. Might a department store, or supermarket, turn into an office? Nor indeed any cap on the proportion of any shopping area that might be converted to offices.

The document goes on to explore whether changes could also be made to the Use Classes Order, namely to:

⁃“simplify the A1 shops use class to remove the current named uses and allow for a broader definition of uses for the sale, display or service to visiting members of the public.”

⁃ consider whether there is “scope for a new use class that provides for a mix of uses within the A1, A2 and A3 uses beyond that which is considered to be ancillary, which would support the diversification of high street businesses. This would replace the existing A1, A2 and A3 and result in a single use class to cover shops, financial and professional services, restaurants and cafes. This would mean that movement between these uses was no longer development and not a matter for the planning system to consider. It would bring greater flexibility but reduce the ability of communities and local planning authorities to distinguish between shops and restaurant uses“.

I agree that these parts of the Use Classes Order potentially need reform (within boundaries – is it really workable for there to be no distinction at all between A1 and A3?) but can’t this be as part of broader reform of the Order? The B, C and D classes all give rise to equivalent issues in that the old distinctions between uses have become increasingly difficult to apply.

“A new permitted development right to support housing delivery by extending buildings upwards to create additional homes”

This idea has been around since February 2016 without civil servants arriving at draft legislation, which is surely going to be the practical test.

Looking back, I covered this proposal most recently on 13 October 2018 in my blog post The Up Right, before that in my 17 March 2017 blog post Permitted Development: À La Recherche Du Temps Perdu and before that in my 15 June 2016 blog post Permitted Development: What Next? However, this latest version of the proposals is certainly the most far-reaching.

The permitted development right would allow additional storeys to be built above buildings in a wide range of uses, including residential, retail and offices. The Government indicates:

“We want to explore whether there may also be other buildings whose use is compatible with the introduction of new homes. Given they are usually located in residential areas or high streets, would premises such as health centres and buildings used for community and leisure purposes be suitable for inclusion in the permitted development right? Out of town retail parks with a mix of shopping and leisure uses may also be suitable for upward extensions to provide additional homes.”

The consultation paper asks for “examples of how this permitted development right might be used in practice, and particularly of how the use of local design codes could help to encourage take up of the proposed right and improve the design quality and acceptability of upward extensions.”

It’s sounding complicated already. Then add the question of how far upwards the permitted development right could allow development to go. The consultation paper offers two alternatives, both of which could lead to significant factual disputes:

⁃ “A permitted development right could apply to the airspace above premises in a terrace of two or more joined properties where there is at least one higher building in the terrace. The roof of the premises extending upward would be no higher than the main roofline of the highest building in the existing terrace.”

⁃ “An alternative approach would be to permit upward extensions more widely to a height no higher than the prevailing roof height in the locality. While this may extend the proposed right to a greater number of properties, it would not be possible to define prevailing roofline in regulations. Therefore it would be a matter to be considered by the local authority as part of the prior approval. In doing so, the local authority would be able to define what it considered to be the prevailing roofline taking account of the local building types and heights and the extent of the area over which it should be determined.”

To add to the complications:

“Where premises are not on level ground the impact of adding additional storeys can be significantly greater on the amenity of neighbouring premises, for example from overlooking and overshadowing and on the character of the area. We would welcome views on how best to take account of the topography of specific areas.”

The consultation paper proposes that there should be a maximum limit of five storeys from ground level for a building once extended (so the extension could be up to four storeys!). But there would be an even broader permitted development right for purpose built, free standing blocks of flats of over five storeys. “The government would also like a permitted development right to apply to such buildings, and is interested in views, including whether there should be a limit on the number of additional storeys that could be added, for example 5”

The permitted development right would allow for the physical works required to construct or install additional storeys on a building. It could also, for instance, allow for “works within the curtilage where it is necessary for access to the additional new homes“.

The prior approval requirements would include appearance, ie “considering whether the proposed development is of good design, adds to the overall quality of the area over its lifetime, is visually attractive as a result of good architecture, responds to the local character and history of the area and maintains a strong sense of place, as set out in paragraph 127 of the National Planning Policy Framework. We expect prior approval on design to be granted where the design is in keeping with the existing design of the building.

Prior approval would also consider the impact of the development on the amenity of neighbouring premises, for example, from obscuring existing windows, reducing access to light or resulting in unacceptable impact on neighbours’ privacy from overlooking. It would also consider measures to mitigate these impacts, and enable the neighbours, including owners and occupiers of premises impacted, to comment on the proposal.”

This is asking a lot of the 56 day prior approval process – sounds like a job for a traditional planning application to me.

Finally, yet another extension of the previous proposals: “We are seeking views on whether the proposed right to build upwards to create new homes should additionally allow householders to extend their own homes.”

This all sounds like it’s on a collision course with what the Government has set in train with the establishment of the ‘Building Better, Building Beautiful‘ Commission.

“The permitted development right to install public call boxes and associated advertisement consent”

I may come back in a later blog post to the Government’s proposal to remove permitted development rights for the installation of public call boxes. Since earlier blog posts on the subject, I’m now off-side from commenting in detail due to acting for an electronic communications code operator, but I would briefly note that the need for additional apparatus is about enabling electronic communications both present (3G, 4G and wifi) and future (5G) rather than just being about the old phone box concept and in that respect the terminology in Part 16 and the references in the Control of Advertisements Regulations probably do need updating without throwing the baby out with the bathwater.

“Supporting housing delivery by allowing for the demolition of commercial buildings and redevelopment as residential”

Well this proposal dates back to October 2015! As with the upwards extensions proposal, is it simply too difficult to draft in legislative form? The wording in the consultation paper is certainly tentative:

⁃ “It may be that a right focused on smaller sites may be more practical...

⁃ Despite the Government having set its face against affordable housing requirements in relation to the office to residential permitted development right, with this right it is said that the Government “would be interested in views on how developer contributions expected towards affordable housing and other infrastructure could be secured.”

⁃ “We would welcome views as to the design of a right which could operate effectively to bring sites forward for redevelopment. The responses to these questions will inform further thinking and a more detailed consultation would follow.”

To be provocative, if additional storeys of residential development are to have deemed permission, and if new residential developments are to have deemed permission if they replace commercial buildings, what is the logic for not granting deemed permission for residential development on brownfield land more generally – what is inherently more complex or controversial arising from that than from the development that could come forward under these new rights? Why the prior complications with brownfield land, but not with these other rights, of land having to be placed by a local planning authority on a register before there is permission in principle?

The deadline for consultation responses is 14 January 2019.

Simon Ricketts, 8 December 2018

Personal views, et cetera

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