Material considerations — Application for planning permission for food superstore — Offer to fund highway improvements — Informal preference for site by local plan inquiry inspector — Planning permission refused — Whether offer of funding should have been discounted — Whether informal preference should have been discounted — Relevance of tests of reasonableness in Annex B to Circular 16/91
The
respondents, Tesco Stores Ltd (‘Tesco’), applied to West Oxfordshire District
Council (‘the council’) for planning permission to build a food superstore on
land at Witney, known as the Henry Box site. The application was called in by
the Secretary of State for the Environment, for his own determination. A public
inquiry was held into the application and into appeals in relation to two
further proposed food retail stores on two other sites in Witney. One of those
sites had been promoted by Tarmac Provincial Properties Ltd (‘Tarmac’).
Previously, a
local plan inquiry had been held into proposed alterations to the Witney local
plan. In his report, the local plan inspector expressed an informal preference
for the Henry Box site as an appropriate alternative site for a large
foodstore, having recommended against the site which was proposed in the local
plan. This informal preference was subsequently supported by the council. Tesco
had made an offer to the council to fund an improvement to the local highway
network, known as the West End Link. This was situated at a considerable
distance from the Henry Box site and the planning inquiry inspector found that
the proposed food superstore would not generate a great deal more traffic than
other permitted uses for the site: although there was some relationship between
the funding of the West End Link and the proposed food superstore, the
relationship was tenuous.
The planning
inquiry inspector, however, recommended that planning permission be granted for
the Henry Box site and that the appeals in respect of the other two sites be
rejected.
The Secretary
of State did not accept this recommendation. He refused the application
relating to the Henry Box site and allowed the appeal of Tarmac. In particular,
he stated that Tesco’s offer of funding
Act 1991: Planning Obligations — and that the local plan inspector’s
informal preference for the Henry Box site should be given only limited weight.
Tesco applied
to the High Court under section 288 of the Town and Country Planning Act 1990
to quash the decision of the Secretary of State. The principal grounds of
challenge were that the Secretary of State had wrongly discounted Tesco’s offer
to fund the West End Link and had wrongly failed to give appropriate weight to
the local plan inquiry inspector’s preference.
The application
was allowed by Mr Nigel Macleod QC, sitting as a deputy judge of the Queen’s
Bench Division, who held that the offer of funding was a material consideration
which the Secretary of State had failed to take into account. The Secretary of
State was entitled, however, to give whatever weight he chose to the local plan
inspector’s preference: see [1993] 2 PLR 108.
The Secretary
of State and Tarmac appealed.
appeals were allowed.
1. The main
issue was whether the Secretary of State misdirected himself by treating
Tesco’s offer to fund the West End Link as immaterial and so excluding it from
his consideration on the basis of a necessity test (taken from Annex B of
Circular 16/91), which he should not have applied at all: see p109E.
On a reading
of his decision letter, the Secretary of State did not exclude Tesco’s offer
from consideration. He did not say that it was irrelevant or immaterial; he
concluded that it was unreasonable to attach weight to the offer since the food
superstore would have no more than a marginal effect on the volume of traffic
in the town centre: see pp 109E-110F.
The weight to
be given to any material consideration was a matter of planning judgment for
the Secretary of State and not a matter of law for the court: see p110G.
Per Steyn LJ: Even if the Secretary of State had only rested his
decision on the ground that the funding failed the tests of Annex B of Circular
16/91 his decision would have been within the limits of the discretion
entrusted to him by the planning Acts. That discretion is wide enough to
comprehend the publication of circulars which are not made in the exercise of a
statutory rule-making power. The Secretary of State was entitled to take the
view that Tesco’s offer of funding, having plainly failed the test of necessity
in Annex B of Circular 16/91, was not a material consideration. The contention
that because Tesco offered the funding, the Secretary of State was not entitled
to apply the policy set out in Annex B should be rejected. The governing
principle was that planning permission might not be bought and sold. The test
of necessity, although going further than the Newbury tests, was
perfectly valid as a policy statement elaborating that principle: see pp
117B-118A.
2. The
Secretary of State had referred to the local plan inquiry inspector’s
preference and treated it as material. However, he gave it only limited weight
and weight was a matter for him. He had also set
to in the judgment
Bradford
City Metropolitan Council v Secretary of State
for the Environment (1986) 53 P&CR 55; [1986] 1 EGLR 199; 278 EG 1473;
[1986] JPL 598, CA
Good v Epping Forest District Council [1994] 1 WLR 376; [1993] 3
PLR 135, CA
Newbury
District Council v Secretary of State for the
Environment [1981] AC 578; [1980] 2 WLR 379; [1980] 1 All ER 731; (1980) 78
LGR 306; 40 P&CR 148; [1980] JPL 325, HL
R v Plymouth City Council, ex parte Plymouth & South Devon
Co-operative Society Ltd (1993) 67 P&CR 78; [1993] 2 EGLR 206; [1993]
36 EG 135; [1993] 2 PLR 75, CA
Appeals
against decision of Mr Nigel Macleod QC
These were
appeals by the Secretary of State for the Environment and Tarmac Provincial
Properties Ltd against the decision of Mr Nigel Macleod QC, sitting as a deputy
judge of the Queen’s Bench Division, on July 7 1993 allowing an application by
Tesco Stores Ltd under section 288 of the Town and Country Planning Act 1990 to
quash the decision of the Secretary of State for the Environment, whereby he
refused an application by Tesco Stores Ltd, which he had called in for
determination, for planning permission to develop a site at Witney,
Oxfordshire, for a food superstore: [1993] 2 PLR 108.
(instructed by the Treasury Solicitor) appeared for the Secretary of State for
the Environment.
Lockhart-Mummery QC and Richard Drabble (instructed by McKenna & Co)
appeared for Tarmac Provincial Properties Ltd.
Vandermeer QC and Christopher Katkowski (instructed by Berwin Leighton)
appeared for the respondents, Tesco Stores Ltd.
Oxfordshire District Council, the second respondents to the original
application, did not appear and were not represented.
following judgments were handed down.
SIR THOMAS
BINGHAM MR: These appeals are against a decision of
Mr Nigel Macleod QC, sitting as a deputy judge of the Queen’s Bench Division,
under section 288 of the Town and Country Planning Act 1990. By his decision
the judge quashed a decision of the Secretary of State for the Environment
given by a letter dated April 16 1993: [1993] 2 PLR 108.
There are
effectively three parties to these proceedings, to whom I shall refer as Tesco,
Tarmac and the Secretary of State.
Both Tesco and
Tarmac wanted planning permission to build a retail food superstore on the
outskirts of Witney, Oxfordshire. Tesco wanted to build on what has been called
the Henry Box site, Tarmac (who acted in conjunction with Sainsbury) on a site
known as Mount Mills. Other developers wanted planning permission to build on
other sites, but they are not parties to these proceedings and their role can
for present purposes be ignored.
Following a
public inquiry the inspector recommended the grant of planning permission to
Tesco for the Henry Box site. The Secretary of State did not accept that
recommendation. He granted planning permission to Tarmac for the Mount Mills
site. This was the decision which the judge quashed. The Secretary of State and
Tarmac now appeal, contending that the judge should not have quashed the
Secretary of State’s decision. Tesco seeks to uphold the judge’s decision.
The facts
The old market
town of Witney straddles the River Windrush, over which there is a single
bridge in the centre of the town. Southbound traffic must approach this bridge
along Bridge Street, northbound traffic by Mill Street or High Street. Severe
traffic congestion in and around the bridge is a longstanding feature of life
in Witney.
A local plan
was made for Witney. To this West Oxfordshire District Council proposed
alterations. These proposed alterations provoked objections and from October to
December 1991 a local plan inquiry was held. The local plan inspector reported
in March 1992.
Two proposed
alterations relevant to these appeals were canvassed at this inquiry. One
concerned a proposed new road (involving a second river crossing) to the west
of the town. This was known as the West End Link (or WEL for short). The main
object of the WEL was to relieve the traffic congestion in the area of the
single existing bridge. The second proposed alteration was to provide for a
major retail food superstore in the centre of the town. No alteration was proposed
to make provision for retail superstores on Tesco’s Henry Box site, Tarmac’s
Mount Mills site or any of the other sites favoured by other developers, all of
these sites being significantly further from the centre of the town than that
which was the subject of the proposed alteration. But Tesco, Tarmac and other
developers appeared and played a full part at the inquiry, no doubt recognising
that if the town centre site were approved their own chances of building on
their own sites would be reduced.
The local plan
inspector’s report to the district council was long and detailed. He reached
three main conclusions relevant to these appeals:
(1) He held that the WEL had a valuable role to
play in relieving congestion in the town centre and that provision for a new
distributor road should be included as a policy statement.
(2) He rejected the proposed alteration to
provide for a large retail food superstore in the town centre. He did not
regard it as within his remit to make any formal recommendation on the competing
sites outside the town centre favoured by Tesco, Tarmac and the other
developers, but he was asked to express an informal preference. He accordingly
considered the merits of these competing sites. Development of a retail food
superstore on one of these sites would, he held, be beneficial for the future
development of the town. He concluded that the best site for the superstore
would be Tesco’s Henry Box site.
(3) He judged that funding for the WEL was most
unlikely to come from the highway authority. He recommended that provision for
funding should not form part of the policy itself, but that the policy
statement
to negotiate funding or a major contribution before a superstore went ahead.
The district
council accepted the local plan inspector’s recommendations. The planning
committee favoured the Mount Mills site, but the full council supported the
inspector’s preference for the Henry Box site, partly because (as will be seen)
Tesco was willing to fund the WEL.
Tarmac applied
for planning permission to build a retail food superstore on the Mount Mills
site, but the district council did not determine the application within the
prescribed period and it automatically became the subject of an appeal. The
Secretary of State called in an application by Tesco to build a retail food
superstore on the Henry Box site. Tarmac’s appeal and Tesco’s application
(together with another appeal not now relevant) were the subject of an inquiry
held in July 1992.
At the inquiry
Oxfordshire County Council argued that full private funding of the WEL (at a
cost of £ 6.6m) must be forthcoming if a superstore was to be built on any of
the sites. The absence of full funding for the WEL was, they contended, a
constraint to development. Tesco expressed willingness to provide this funding
if it obtained permission to develop the Henry Box site. The district council
supported the county council’s argument that lack of highway capacity was a
fundamental constraint on developing any superstore and regarded Tesco’s offer
of funding as swinging the balance of advantage decisively in favour of the
Henry Box site. Tesco argued that there was a fundamental objection to any
scheme which did not secure full funding of the WEL, but urged acceptance of
the Henry Box site because of the offer of funding which came with it. Tarmac
contended that it was inappropriate for any of the superstore developers to
contribute to the funding of the WEL since the available figures showed that
the building of a superstore, as compared with office development for which
permission already existed, would have no more than a marginal effect on
traffic flows in the town centre. At the inquiry the merits and demerits of the
competing sites were closely examined.
The inspector
held that the competing proposals raised two main questions. The first of these
was whether there was a fundamental constraint to the development of a food
superstore if funding of the WEL was absent. She considered this question in
the light of Circular 16/91 — Planning and Compensation Act 1991: Planning
Obligations, noting that unacceptable development should not be permitted
because of unrelated benefits offered by the applicant and that planning
obligations could relate to land, roads, etc other than those covered by the
planning permission provided there was a direct relationship between the two.
She went on to hold that the development of the Henry Box site, which came with
the offer of full funding for the WEL, was not unacceptable development and
that there was a relationship between the development of the superstore sites
and the WEL. But that relationship was, she said, ‘tenuous’:
Any
superstore site would be a considerable distance from the WEL and Bridge Street
and the development proposed would not generate a great deal more traffic than
the other permitted uses of the sites.
But she
thought that if a major developer offered to fund the WEL in association with a
development which had been subject to considerable scrutiny at local plan and
development control level, it would be imprudent to turn the offer away if it
was lawful, enforceable and likely to come to fruition. Tesco would not be
buying planning permission because the proposal had been through the local plan
process. She took the view that full funding of the WEL was not fairly and
reasonably related in scale to the proposed development of the Henry Box site
and that it would be unreasonable for the council to require a developer of a
previously approved development site fully to fund a major road proposal
because his development would marginally increase traffic over and above that
already permitted. But she pointed out that the district council were not
imposing such a requirement. On this question she concluded:
If the
Council negotiations result in the offer of a full contribution to the cost of
the WEL from the developer of a site preferred by the Council following a
lengthy Local Plan inquiry, then it would be perverse to turn away the offer.
The Council therefore finds itself in the somewhat surprising but felicitous
position of the first major developer since the Local Plan inquiry responding
to the Council’s offer to negotiate on WEL funding by a full funding proposal.
This seems to me to be a perfectly proper outcome of negotiations provided that
the agreement entered into is sufficiently robust to achieve the benefits
promised.
The second
question addressed by the inspector was which of the three sites should be
selected, bearing in mind their recent planning history. She found that there
was little to choose between them, but agreed that permission should be given
to develop only one. She said that considerable weight should be given to the
local plan process, the views of the local plan inspector and the decision of
the council to follow his recommendation. It would undermine the validity of
the local plan process if she were to recommend a different site from that
preferred by the local plan inspector unless there was significant new evidence.
She considered that the merits of the competing sites were finely balanced, but
concluded:
If it is
considered that weight can properly be accorded to the informal recommendation
of the Local Plan Inspector in favour of the Henry Box site and the Council’s
endorsement of it then outline planning permission should be granted to the
application for the proposed development on that site. I take this view because
of the emphasis being placed by government on a plan led system and the fact
that there is no overwhelming new evidence to swing the balance in favour of
either of the other sites.
She
accordingly recommended that Tesco’s application be granted and Tarmac’s appeal
dismissed.
In his
decision letter dated April 16 1993 the Secretary of State agreed
questions, relating to the need to secure full funding of the WEL if a
superstore were to be permitted, the Secretary of State gave his decision in
two paragraphs which are so central to this appeal that they must be quoted in
full:
7. Turning,
therefore to the first main issue, the WEL, the Secretary of State accepts that
a new food store on any of the three sites would result in additional traffic
on the local road network, but he observes that such an increase would be less
than 10% in excess of that which would have been generated by the permitted B1
development on the Mount Mills and Henry Box sites. He agrees with the
Inspector that this slight worsening of traffic conditions produces some
relationship between the funding of WEL and a proposed store, but shares her
view that the relationship is tenuous, given the distance of these sites from
WEL, and the amount of traffic likely to be generated compared to the potential
from uses already permitted. Looking at the offer of funding made by Tesco in
relation to the tests of reasonableness set out in paragraph B8 of Annex B to
Circular 16/91, the Secretary of State does not consider that WEL is needed to
enable any of the superstore proposals to go ahead, or is otherwise so directly
related to any of the proposed developments and to the use of the land after
completion that any of the developments ought not to be permitted without it.
He appreciates that provision for the road is made in the Local Plan which is
nearing adoption, and that it is the County Council’s intention to seek funding
or a major contribution. However, having regard to paragraph B9 of the Annex to
the Circular, and bearing in mind also that no contributions towards highway improvements
were sought when planning permission was granted in 1991 for B1 development on
two of the sites, he agrees with the Inspector that the full funding of WEL is
not fairly and reasonably related in scale to any of the proposed developments.
As to whether it would be appropriate to seek a major contribution from
developers before allowing any superstore proposal, he takes the view, given
the anticipated traffic levels and the distance between the sites and the route
of WEL, that it would be unreasonable to seek even a partial contribution from
developers towards the cost of the work in connection with the proposals
currently before him. He notes the Inspector’s conclusion that it would be
‘perverse’ to turn away an offer from a developer of a site preferred by the
Council after a lengthy Local Plan inquiry but, for the reasons given in
paragraphs 5 and 6 above, he thinks that the expressed preference can carry
only limited weight. Accordingly, in his view, since the offer of funding fails
the tests of Annex B of Circular 16/91, it cannot be treated either as a reason
for granting planning permission to Tesco or for dismissing either of the two
section 78 appeals.
8. If the
Secretary of State is wrong in his conclusion that it would be unreasonable to seek
even a partial contribution towards the funding of WEL, then it would be the
case that he would be required to take into account Tesco’s offer of funding,
albeit not fully but only to the extent of such partial contribution as he
considered was reasonable. For the same reasons that led him to his conclusion
that not even the seeking of a partial contribution would be reasonable, he
considers that the extent to which the funding should be taken into account
(assuming, for the purposes of argument, that it has to be taken into account
at all) will be of such a limited nature that, even upon taking the benefit
into account, the balance of the arguments would not be tipped so as to change
his decision.
On the second
question, the Secretary of State shared the inspector’s view that only one
superstore should be allowed, but reached the conclusion (for reasons which he
gave) that the Mount Mills site was to be preferred. He held that the local
plan inspector’s informal preference for the Henry Box site should, in the
circumstances, be given only limited weight. He accordingly decided not to
accept the inspector’s recommendation and allowed Tarmac’s appeal.
Tesco’s first
main ground of challenge to the Secretary of State’s decision was that he had
wrongly failed to give appropriate weight to the local plan inspector’s
preference and the district council’s acceptance of it and had given no
adequate explanation of his reasons for disregarding them. The judge rejected
this ground of challenge, but it has been raised by Tesco in this court in a
respondent’s notice and is considered below.
Tesco’s second
main ground of challenge before the judge was that the Secretary of State had
failed to take into account a material consideration when he decided that
Tesco’s offer to fund the WEL could not be treated as a reason for granting
planning permission to Tesco or for dismissing Tarmac’s appeal. Tesco argued
that the Secretary of State had erred in applying the tests of Annex B of
Circular 16/91 (in particular, an inappropriate test of necessity) and making
his decision on the basis of what could be required by a local planning
authority rather than on the basis of what could be accepted when an offer had
been freely and voluntarily made. It also argued that the Secretary of State
was wrong to hold, in para 8 of his decision letter, that if he was required to
take into account Tesco’s offer of funding he could do so only to the extent of
such partial contribution as he considered reasonable.
This challenge
the judge upheld. He referred to Newbury District Council v Secretary
of State for the Environment [1981] AC 578 and R v Plymouth City
Council, ex parte Plymouth & South Devon Co-operative Society Ltd
(1993) 67 P&CR 781 and said [see [1993] 2 PLR 108 at p118G]:
In considering
this issue, I note that the Secretary of State found that there was some
relationship between the funding of the West End Link and a proposed store
because of the slight worsening of traffic conditions: a less than 10% traffic
increase.
It is clear
from the wording of paras 7 and 8 of the decision letter that the Secretary of
State has applied the same tests, those from Annex B, paras B8 and B9 of
Circular 16/91, in both those paragraphs.
The use and
application of those tests are not appropriate in the case where an offer
from a proposed developer is under consideration. In doing so, the Secretary of
State has introduced glosses on the Newbury tests which he should not
have done. For example, he has introduced the concept of necessity, and he has
introduced, directly from para B9, the concept of fair and reasonable
relationship m scale, which is a gloss on the Newbury test of
‘fairly and reasonably relate to the development’. In para B9, the principle of
scale is explained as a requirement that the payment should be directly related
in scale to the benefit which the proposed development would derive from the
facilities to be provided. This differs from the test approved in the Plymouth
case. The tests of paras B8 and B9 of the circular are not
The question
of Wednesbury unreasonableness cannot, in my judgment, arise in the
present case, nor can it be disputed that the provision of the West End Link
has a planning purpose.
The correct
question for consideration, therefore, is whether the West End Link fairly and
reasonably related to the development. In this respect, I note from the
inspector’s report at para 7.4, that the West End Link would be unlikely to
come forward without Tesco’s offer; I note from para 7.2 that there are severe
traffic problems in Witney, particularly Bridge Street, and that a new
foodstore would result in additional traffic on the road network, particularly
Bridge Street; and I note from para 7.5 that the West End Link is necessary to
ameliorate existing traffic conditions. Looking at all these factors together,
I find that there is a fair and reasonable relationship between the offer to
fund the West End Link and the proposed superstore, and that the offer is a
material factor which the Secretary of State failed to take into account.
1Also reported at [1993] 2 PLR 75.
He held that
the Secretary of State might have reached a different decision had he taken
account of the funding offer and accordingly quashed the decision.
In this court,
Tesco repeats the criticism of the Secretary of State’s decision letter which
succeeded below. The Secretary of State and Tarmac contend that the Secretary
of State did not treat the offer of funding as immaterial or apply any wrong
test: he simply attached no weight to the offer in all the circumstances, as he
was entitled to do.
The 1990
Act
Section 70(1)
and (2) of the 1990 Act are in these terms:
70.-(1) Where an application is
made to a local planning authority for planning permission –
(a) subject to sections 91 and 92 they may
grant planning permission, either unconditionally or subject to such conditions
as they think fit; or
(b) they may refuse planning permission.
(2) In dealing with such an application the authority
shall have regard to the provisions of the development plan, so far as material
to the application, and to any other material conditions.
. . .
I take
‘material’ in this context to mean ‘relevant’. Thus, the subsection expresses
the familiar rule that a decision-maker must take account of relevant
considerations and not take account of irrelevant considerations. Where an
application or appeal is determined by the Secretary of State, he is subject to
the same duty: sections 77(4), 79(4). The weight to be given to any
consideration properly regarded as relevant is, of course, a matter for the
planning decision-maker.
Section 106 of
the Act, as substituted, contains these provisions:
Planning
obligations
106.-(1) Any person interested in
land in the area of a local planning authority may, by agreement or otherwise,
enter into an obligation (referred to in this section and sections 106A and
106B as ‘a planning
(a) restricting the development or use of the
land in any specified way;
(b) requiring specified operations or activities
to be carried out in, on, under or over the land;
(c) requiring the land to be used in any
specified way; or
(d) requiring a sum or sums to be paid to the
authority on a specified date or dates or periodically.
(2) A planning obligation may –
(a) be unconditional or subject to conditions;
(b) impose any restriction or requirement
mentioned in subsection (1)(a) to (c) either indefinitely or for such period or
periods as may be specified; and
(c) if it requires a sum or sums to be paid,
require the payment of a specified amount or an amount determined in accordance
with the instrument by which the obligation is entered into and, if it requires
the payment of periodical sums, require them to be paid indefinitely or for a
specified period.
(3) Subject to subsection (4) a planning
obligation is enforceable by the authority identified in accordance with
subsection (9)(d)-
(a) against the person entering into the obligation;
and
(b) against any person deriving title from that
person.
This section
is central to these appeals, since on July 28 1992 Tesco entered into a written
agreement with Oxfordshire County Council undertaking a planning obligation
under the section: the obligation was to pay £ 6.6m if planning permission for
the development of the Henry Box site was granted.
Authority
Before this
court, as before the judge, argument largely turned on the two cases to which
the judge referred.
In the Newbury
case, planning permission was given for the use of old wartime hangars for
storage purposes subject to a condition that the hangars should be removed at
the end of a 10-year period. After that period had expired the user continued
to use the hangars as before and did not remove them. The local authority
served enforcement notices. The user appealed. The Secretary of State held that
the removal condition was invalid because extraneous to the proposed use. The
divisional court upheld that decision. The Court of Appeal overruled it. The
House of Lords restored it. The House held that a planning condition, to be
valid, must satisfy three tests: it must have a planning purpose; it must
relate to the permitted development to which it is annexed; and it must be
reasonable: see [1981] AC 578 at pp599H, 607F, 618G, 627B. The House concluded
that the condition in question failed the second of these tests and the
Secretary of State was entitled so to decide.
This decision
is plainly binding on planning authorities, the Secretary of State and lower
courts for what it decided, and I do not think its effect is in any way
doubtful. Conditions may not be attached to planning permissions to achieve
purposes which, however desirable in themselves, are not planning purposes and
do not relate to the development for which conditional permission is being
given. Nor must
decision prescribed the requirements which a planning condition, to be valid,
must fulfil.
In the Plymouth
case the applicant sought judicial review of planning permissions granted to
two superstore operators, who happened to be Tesco and Sainsbury. These two
operators had offered to enter into section 106 agreements under which they
were to provide facilities on and off the superstore sites, including a creche,
park-and-ride schemes, a wildlife habitat, a bird-watching hide, an art display
and a tourist information centre. The applicant argued that these facilities
were not needed to overcome any planning objection to the two schemes and so
were not ‘necessary’; that since the facilities were not necessary the offer to
provide them was not a material (or relevant) consideration to be taken into
account on the grant of planning permission; and that the planning authority
had accordingly misdirected itself in paying attention to the offer of these
facilities.
This challenge
failed before Hutchison J and the Court of Appeal. It was held that the Newbury
tests included no test of necessity and that there was no room for such a test.
On the facts it was held that the facilities offered did have a planning
purpose and did relate to the permitted development. Thus, the decision held
that an offer does not have to be necessary to overcome a planning objection in
order to be a material (or relevant) matter for consideration in granting
planning permission and the attempt to gloss Newbury so as to introduce
that additional requirement was rejected.
Circular
16/91
In Bradford
City Metropolitan Council v Secretary of State for the Environment
(1986) 53 P&CR 55 at p64 Lloyd LJ described it as axiomatic that planning
consent cannot be bought and sold. By that he meant, as I understand, that
planning applications are to be decided on their merits and a well-heeled
developer is not to obtain permission for an otherwise unacceptable development
by offering benefits unrelated to the development in question, but seen by the
planning authority as beneficial in the public interest.
As originally
enacted in 1990, section 106 reproduced what had been section 52 of the Town
and Country Planning Act 1971. But section 106 as it now stands was substituted
by section 12 of the Planning and Compensation Act 1991 and Circular 16/91 was
issued to give guidance on the proper use of planning obligations under section
106 in its new form. Such obligations may arise where, as here, a formal
written agreement is made between prospective developer and planning authority,
or where, usually on an appeal, the developer makes an offer which the planning
authority do not accept and which does not therefore ripen into an agreement.
It seems plain that underlying the circular was concern about the previous use
of the imprecise and misleading term ‘planning gain’ to justify the acceptance
of offers unrelated to development proposals. It is made plain that planning
powers are not intended to be used for such a purpose.
It is, I
think, necessary to quote the full terms of the most relevant
General
policy
B5. The
following paragraphs set out the circumstances in which certain types of
benefit can reasonably be sought in connection with a grant of planning
permission. They are the circumstances to which the Secretary of State and his
inspectors will have regard in determining applications or appeals. They may be
briefly stated as those circumstances where the benefit sought is related to
the development and necessary to the grant of permission. Local planning
authorities should ensure that the presence or absence of extraneous inducements
or benefits does not influence their decision on the planning application.
Authorities should bear in mind that their decision may be challenged in the
courts if it is suspected of having been improperly influenced.
B6. Planning
applications should be considered on their merits and determined in accordance
with the provisions of the development plan unless material considerations
indicate otherwise. It may be reasonable, depending on the circumstances,
either to impose conditions on the grant of planning permission, or (where the
planning objection to a development proposal cannot be overcome by means of a
condition) to seek to enter a planning obligation by agreement with the
applicant which would be associated with any permission granted. If there is a
choice between imposing conditions and entering into a planning obligation, the
imposition of a condition is preferable because it enables a developer to
appeal to the Secretary of State. The terms of conditions imposed on a planning
permission should not be re-stated in a planning obligation, because that would
entail nugatory duplication and frustrate a developer’s right of appeal.
B7. As with
conditions (see DOE Circular 1/85, Welsh Office Circular 1/85), planning
obligations should only be sought where they are necessary to the granting of
permission, relevant to planning, and relevant to the development to be
permitted. Unacceptable development should never be permitted because of
unrelated benefits offered by the applicant, nor should an acceptable
development be refused permission simply because the applicant is unable or
unwilling to offer such unrelated benefits.
B8. The test
of the reasonableness of seeking a planning obligation from an applicant for
planning permission depends on whether what is required:
(1) is needed to enable the development to go
ahead, for example the provision of adequate access or car parking; or
(2) in the case of financial payment will
contribute to meeting the cost of providing such facilities in the near future;
or
(3) is otherwise so directly related to the
proposed development and to the use of the land after its completion, that the
development ought not to be permitted without it, eg the provision, whether by
the applicant or by the authority at the applicant’s expense, of car parking in
or near the development, of reasonable amounts of open space related to the
development, or of social, educational, recreational, sporting or other
community provision the need for which arises from the development; or
(4) is designed in the case of mixed
development to secure an acceptable balance of uses; or to secure the
implementation of local plan policies for a particular area or type of
development (eg the inclusion of an element of affordable housing in a larger
residential development); or
(5) is intended to offset the loss of or impact
on any amenity or resource
nature conservation. The Department welcomes the initiatives taken by some
developers in creating nature reserves, planting trees, establishing wildlife
ponds and providing other nature conservation benefits. This echoes the
Government’s view in This Common Inheritance (Cm 1200) that local
authorities and developers should work together in the interest of preserving
the natural environment.
Planning
obligations can therefore relate to land, roads or buildings other than those
covered by the planning permission, provided that there is a direct
relationship between the two. But they should not be sought where this
connection does not exist or is too remote to be considered reasonable.
B9. If what
is required passes one of the tests set out in the preceding paragraph, a
further test has to be applied. This is whether the extent of what is required
is fairly and reasonably related in scale and kind to the proposed development.
Thus a developer may reasonably be expected to pay for or contribute to the
cost of infrastructure which would not have been necessary but for his
development, but his payments should be directly related in scale to the
benefit which the proposed development will derive from the facilities to be
provided. So, for example, a developer may reach agreement with an
infrastructure undertaker to bring forward in time a project which is already
programmed but is some years from implementation.
It is made
plain in para B12 that decisions on the acceptance of unilateral offers should
follow the general guidance contained in the circular.
Main issue
The main issue
is whether, as the judge held and Tesco contends, the Secretary of State
misdirected himself by treating Tesco’s offer to fund the WEL as immaterial and
so excluding it from his consideration on the basis of a necessity test which
he should not have applied at all. To test the correctness of this criticism it
is, in my view, necessary to analyse the relevant paragraphs of the Secretary
of State’s decision letter (quoted above) in a little detail.
As it seems to
me, the Secretary of State’s relevant conclusions were these:
(1) A new superstore on any of the sites would
lead to some increase of traffic on the local road network.
(2) This slight worsening of traffic conditions
meant that there was a relationship between the funding of the WEL and a new
superstore.
(3) This relationship was tenuous, given the
distance of the sites from the WEL and the small increase in the traffic likely
to be generated by the stores as compared with the development for which
permission already existed.
(4) The reasonableness of relying on Tesco’s offer
of funding should be judged by the tests of reasonableness set out in para B8
of Annex B of Circular 16/91.
(5) Applying those tests: (a) the WEL was not
needed to enable any of the superstore proposals to go ahead; (b) the WEL was
not so directly related to any of the superstore developments that they ought
not to be permitted without it.
(6) Applying para B9 of Annex B: (a) full funding
of the WEL was not fairly and reasonably related in scale to any of the
proposed developments; (b) it would be unreasonable to seek even a partial
contribution towards the cost of the WEL, given the anticipated traffic levels
and the distance between the sites and the WEL.
(7) Since the offer of funding failed the tests
of Annex B of the circular it could not be treated as a reason for granting
planning permission to Tesco or dismissing Tarmac’s appeal.
(8) If it was not unreasonable to seek even a
partial contribution towards the funding of the WEL and it was reasonable to
take account of a partial contribution, the partial contribution of which it
would be reasonable to take account would be so small as not to affect the
merits of the pure planning decision on the merits of the sites.
It was not
argued in this court that Annex B was unlawful as inconsistent with Newbury,
although I have some doubt whether the language of the annex is fully
reconcilable with that decision. Nor was it argued that it was impermissible
for the Secretary of State to give general guidance on how, in the ordinary run
of cases, a statutory discretion would be exercised. It was pointed out that in
this case the planning authority were not seeking or exacting a planning
obligation, since Tesco’s offer was freely made; but Tesco made its offer in
order to obtain planning permission for its site in preference to its rivals’
and I do not think it is crucial how a planning obligation comes into being.
The issue is whether the Secretary of State wrongly excluded Tesco’s offer from
consideration by wrongly applying a test of necessity.
On a reasonable
and not unduly charitable reading of the decision letter I conclude that he did
not. He acknowledged that there was a connection between the WEL and the
proposed superstores, although for reasons which he gave he considered the
relationship to be tenuous. Had he concluded that there was no relationship he
would no doubt have treated the offer of funding as irrelevant and stopped
there. But he did not say it was irrelevant or immaterial and he did not stop
there. Instead he went on to consider whether in all the circumstances it was
reasonable to attach weight to the offer, a question which would not have
called for consideration had he regarded the offer as irrelevant. He thought it
unreasonable to attach weight to the offer, since the superstore would have no
more than a marginal effect on the volume of traffic in the town centre. In any
event he thought that any funding should be proportional to the increased
traffic burden and he judged this to be so small as to be negligible. It is
plain that the weight to be given to any material consideration is a matter of
planning judgment for the Secretary of State and not a matter of law for the
court. In my judgment, it was open to him to conclude on the facts here that
Tesco’s offer should be given no weight in choosing between the competing sites
and that is what I think he did conclude. If, contrary to my view, it is not
what he concluded, it seems to me to be the conclusion to which, given the
terms of his decision letter, he would inevitably come if the matter were
remitted to him for reconsideration.
The
respondent’s notice
Tesco argued
that the preference expressed by the local plan inspector was a material
consideration and that while the Secretary of State could form a different view
he should have had regard to the importance of consistency and given his
reasons for departing from the local plan inspector’s recommendation.
The judge
summarised this submission in his judgment (at p114E), but rejected it on the
grounds:
(1) that the Secretary of State referred to the
local plan inspector’s preference and treated it as material, but gave it only
limited weight and weight was a matter for him;
(2) that the Secretary of State gave his reasons
for giving the local plan inspector’s preference only limited weight, namely
that it was not part of the development plan process, otherwise than possibly
as an early step in the making of a district-wide local plan;
(3) that the local planning authority had not
incorporated the local plan inspector’s informal preference into the proposed
modifications;
(4) that the appellate process is to be
distinguished from the process of achieving a local plan, and the principle of
consistency operates differently in the two fields.
In my
judgment, the judge was right to reject this argument and I agree with his
reasons for doing so. It has not been, and could not be, suggested that the
Secretary of State did not give adequate reasons for preferring the Mount Mills
to the Henry Box site.
I would allow
these appeals.
BELDAM LJ: I agree with the Master of the Rolls that these appeals should be
allowed. In its application to the court under section 288 of the Town and
Country Planning Act 1990, Tesco had called in question the validity of the
Secretary of State’s decision on the ground that he had not complied with a
relevant requirement of section 70(2) to have regard to the material
consideration that Tesco had entered into a planning obligation under section
106 to fund the West End Link road (WEL). The judge held that the Secretary of
State’s decision was invalid because, by following the policy guidance set out
in Circular 16/91, he had used and applied tests which were not appropriate
where a proposed developer offered to enter into a planning obligation under
section 106 of the Town and Country Planning Act 1990. In applying the Newbury
test the Secretary of State had introduced into it the inappropriate concepts
of necessity and a fair and reasonable relationship in scale.
The Secretary
of State had to decide not only the issues raised by Tesco’s application for
planning permission to erect a superstore on its Henry Box site, but also those
raised in the appeals by Tarmac Provincial Properties Ltd and RP Baker (Oxford)
Ltd under section 78 of the Act. In effect the question for his decision was:
should planning permission be given for the erection of a superstore on one of
the three sites in question and, if so, on which? In arriving at his decision he was required
to have regard to any material consideration.
Whether any
consideration is material to a decision must depend upon the nature of the
decision to be taken. Further, as stated in R v Plymouth
City Council, ex parte Plymouth & South Devon Co-operative Society Ltd
(1993) 67 P&CR 78, whether a consideration is capable of being a material
consideration is a question for the court. The degree to which a matter is to
be regarded as material in any given case is a question for the planning
authority, in this case the Secretary of State.
Failure to
have regard to a material consideration may occur either when the material
consideration is overlooked or ignored altogether or when it is considered but
regarded as of no, or no significant, weight in making the particular decision.
In the first case the maker of the decision will not have paid regard to a
consideration capable of being material; in the second he will have had regard
to it, but discounted its weight or significance wholly or partly in arriving
at his conclusion. The distinction is, in my view, important when the court is asked
to declare invalid a decision made by the Secretary of State on a question
involving policy and judgment which are essentially his preserve.
In the appeal
great reliance was placed upon the decision in the Plymouth case (supra).
In that case the disappointed applicant had argued that entry into a planning
obligation under section 106 could only be regarded as material if it was
necessary to overcome, remedy or alleviate a planning objection to a proposal.
Otherwise it could not be taken into account. The court rejected this
construction of ‘material consideration’ as being ‘far too strict and narrow to
give effect to the terms of the statute . . .’. Russell LJ considered the three
tests laid down in Newbury and, rejecting any suggestion that no
reasonable planning authority could have regarded the obligations in that case
as material, said [at p82]:
. . . I
simply ask myself whether each and every one of them were capable of being
regarded as having a planning purpose and whether each and every one of them
related to the permitted development. So far as the benefits which were to be
provided on site there does not appear to me to be the slightest difficulty or
room for argument. They made the development more attractive and that must
surely be in the public interest.
He held that
the off-site benefits related to the development proposed and were for a
planning purpose, and added [at p83]:
It is not
material to enquire into the precise part played by these benefits in the
decision reached by the planning authority. The reasons for granting permission
are not disclosed though in passing it is worthy of observation to note that
Hutchison J did not seem to regard the benefits as ‘determining factors which
led to the Council’s decisions’.
Later Russell
LJ referred to the ‘wide spectrum of materiality’ illustrated by a number of
decided cases and to the statement by Lloyd LJ in Bradford City Metropolitan
Council v Secretary of State for the Environment that:
. . . it was
‘axiomatic that planning consent cannot be bought or sold’.
Evans LJ
agreed that it was impermissible to regard only those
within the meaning of section 106. In his judgment, Hoffmann LJ referred to
Circular 16/91 and said [at p90]:
These
statements of policy embody a general principle that planning control should
restrict the rights of landowners only so far as may be necessary to prevent
harm to community interests . . . Materiality is an entirely different matter,
because there is a public interest in not allowing planning permissions to be
sold in exchange for benefits which are not planning considerations or do not
relate to the proposed development: see Lloyd LJ in the Bradford case
and Staughton LJ in the Monahan case. The fact that the principle of
necessity is applied as policy by the Secretary of State does not make it an
independent ground for judicial review of a planning decision. As Sir Donald
Nichols V-C pointed out in Good v Epping Forest District Council,
to say that a condition or the requirement of a section 106 agreement would
have been discharged on appeal by the Secretary of State, because its
imposition did not accord with the policies I have quoted, is not at all the
same thing as saying that the planning authority would have been acting beyond
its statutory powers. This depends upon the Wednesbury principle and the
test for materiality in Newbury.
I therefore
reject the suggested gloss upon the Newbury test for materiality and
consider whether they were satisfied by the matters which were proposed to be
included in the section 106 agreements in this case. They all amounted to
considerations of a planning nature and the only question is whether they
fairly and reasonably related to the development.
He had no
doubt about the on site ’embellishments’ and it was only the substantial sums
offered as a contribution to work to be done away from the site which gave
pause for thought. He then held that the offer of contribution to off-site
projects was capable of being fairly and reasonably related to the
developments.
The argument
thus rejected in the Plymouth case was that a planning obligation under
section 106 was only to be regarded as material if it could have been imposed
as a condition for the grant of planning permission and was necessary to
overcome a planning objection. The fact that this restriction was said to be
far too narrow does not mean that the materiality of a planning obligation
under section 106 must be regarded as unrestricted. On the contrary, it is
clear that the court did not so regard it, for it went on to consider the
degree of connection or materiality of both the off-site and on-site planning
obligations.
In section
106(1) the obligations referred to in subsections (a), (b) and (c) clearly
relate to the land in which the person entering into the obligation is
interested. The obligation entered into by a person interested in land under
subsection (d) to pay money to the authority is not expressed to be restricted
to the payment of money for any particular purpose or object. But all the
planning obligations are, by section 106(3), enforceable not only against the
person entering into the obligation but also against his successors in title to
the land. Against the background that it is a fundamental principle that
planning permission cannot be bought or sold, it does not seem to me
unreasonable to interpret section 106 (1)(d) so that a planning obligation
requiring a sum or sums to be paid to the planning authority should be for a
planning
the land in which the person entering into the obligation is interested. A
planning obligation with this degree of connection to the site would be capable
of being regarded as a material consideration.
In a case in
which the person interested in the land offers to enter into an obligation to
pay a sum of money to provide planning benefits off site, the nature and extent
of the relationship and the degree of connection with the land in which he is
interested must be factors which in any particular case determine whether the
obligation is a material consideration.
In this
context I approach the criticism made by the judge of the Secretary of State’s
decision in this case.
Annex B,
Circular 16/91, professes to give guidance on the proper use of planning
obligations under section 106 of the Town and Country Planning Act 1990. Such
guidance is not to be interpreted as if it were a statute. Para B5, General
policy, setting out the circumstances in which certain types of benefit can
reasonably be sought in connection with the grant of planning permission must,
it seems to me, be read as a whole and in context. So, for example, the passage
in which it is said:
They (the
circumstances) may be briefly stated as those circumstances where the benefit
sought is related to the development and necessary to the grant of permission.
Local planning authorities should ensure that the presence or absence of
extraneous inducements or benefits does not influence their decision on the
planning application.
has to be
interpreted in the light of the subsequent paras B7 and B8. In my view, the
word ‘necessary’ is not used in the sense of ‘indispensable’, but is intended
to reflect the policy that the obligation must have a connection with the land
for which permission for development is sought and must be for a planning
purpose. This seems to me consistent with two other paragraphs:
Unacceptable
development should never be permitted because of unrelated benefits offered by
the applicant, nor should an acceptable development be refused permission
simply because the applicant is unable or unwilling to offer such unrelated
benefits.
And:
Planning
obligations can therefore relate to land, roads or buildings other than those
covered by the planning permission, provided that there is a direct
relationship between the two. But they should not be sought where this
connection does not exist or is too remote to be considered reasonable.
In para 7 of
his reasons for decision, the Secretary of State does, in my view, consider the
materiality of the obligation offered by Tesco to fund the whole of the cost of
the WEL. He refers to the factual basis for the degree of relationship between
the obligation to fund the whole of the cost of the WEL and the developments
proposed on the superstore sites. He adopts the assessment of the inspector
that the relationship
. . .
tenuous, given the distance of these sites from the WEL and the amount of
traffic likely to be generated compared to the potential from uses already
permitted.
He does not
consider that the WEL is needed to enable the superstore proposals to go ahead;
they could go ahead whether the WEL is built or not. Nor is it otherwise so
directly related to any of the proposed developments and to the use of the land
after completion that any of the developments ought not to be permitted without
it. In this way he has evaluated any causal or other relationship between the planning
obligation and the site of the proposed developments. He agrees with the
inspector that the full funding of the WEL is not fairly and reasonably related
in scale to any of the proposed developments. He further considers that:
. . . it
would be unreasonable (for the planning authority) to seek even a partial
contribution from developers towards the cost of the work in connection with
the proposals.
I would hold
that the Secretary of State did have regard to the planning obligation offered
by Tesco to fund the WEL. He considered how far it was material to his decision
in the sense of how closely it was related to or connected with the superstore
sites and the proposed developments upon them. In saying that it failed the
tests of Circular 16/91 he was, I think, referring to the matters set out in
para B8, and the general statement of principle in para B7 that:
Unacceptable
developments should never be permitted because of unrelated benefits offered by
the applicant, nor should an acceptable development be refused permission
simply because the applicant is unable or unwilling to offer such unrelated
benefits.
Because his
decision affected three applications, of which only one could succeed, it was
reasonable for him to take account of his statement of policy and to consider
whether an acceptable development might be refused permission simply because
the applicant was unable or unwilling to offer the benefits of the planning
obligation and to have regard to the extent to which those benefits were
material not only to the granting of permission on one of the sites, but also
to refusing permission on the others.
The Secretary
of State considered the merits of each site. Although he agreed that the merits
were finely balanced, he nevertheless gave significant planning reasons for
preferring the Mount Mills site to the Henry Box site. The merits of the sites
depended on the facts and the Secretary of State’s judgment of their planning
implications.
This is not a
case in which the existence of the planning obligation was overlooked or
ignored; the Secretary of State paid regard to it, but considered it had no
weight or was of so little influence that it did not affect his conclusion. Nor
do I think that it was open to the judge to
obligation to fund the whole of the WEL and the sites for which development was
sought.
Further, in
concluding that the planning obligation to fund the WEL was a factor which
could have made a difference to the Secretary of State’s decision ‘bearing in
mind the fine balance between the merits of the sites’, the judge, in my view,
unjustifiably discounted the significant planning reasons given by the
Secretary of State for preferring the Mount Mills site. If the Secretary of
State was required to reconsider his decision and in doing so to attach a
potentially decisive degree of materiality to the offer to fund an off-site
project whose connection with the sites and their development was ‘tenuous’, he
would in effect be disregarding an important aspect of policy by refusing
permission for an acceptable (and preferred) development simply because the
applicant was unable or unwilling to offer benefits only tenuously connected
with the development site. Accordingly, I would reject the criticism of the
Secretary of State’s decision.
STEYN LJ: I agree that the appeals should be allowed. I add only a few
remarks. In doing so I would want my views to read in the light of the
contextual scene contained in the judgment of Sir Thomas Bingham, MR.
On the
respondent’s notice I entirely agree that the judge was right. In the
time-honoured phrase I have nothing useful to add. I turn to the real battle
ground on this appeal.
The principal
issue is whether the Secretary of State misdirected himself by treating Tesco’s
offer to fund the West End Link as immaterial on the ground that such funding
failed the tests set out in Annex B of Circular 16/91 and in particular the
test of necessity. This is a narrow question of construction of the decision
letter of April 16 1993. The Secretary of State set out his primary position in
para 7. The letter recorded that:
. . . in his
view, since the offer of funding fails the tests of Annex B of Circular 16/91,
it cannot be treated either as a reason for granting planning permission to
Tesco or for dismissing either of the two section 78 appeals.
In para 8 the
decision letter addressed the matter on an alternative basis, namely on the
basis that the Secretary of State’s primary position was wrong. On this hypothesis
the decision letter stated:
. . . then
it would be the case that he would be required to take into account Tesco’s
offer of funding.
(Emphasis
supplied.)
In other
words, the Secretary of State’s primary position was that he had to ignore the
funding as immaterial since it failed the tests of Annex B of Circular 16/91.
But, on the supposition that this conclusion was wrong, the Secretary of State
found that if the funding were taken into account, then because of the tenuous
nature of the relationship between
too limited a nature to affect his ultimate decision. For my part I can see
nothing illogical or unreasonable in this two-stage reasoning process of the
Secretary of State. And in view of the second ground of his decision the
submission that he failed to take into account the funding offered by Tesco
must fail. For these reasons I agree that the judge erred and that the appeals
should be allowed.
But I feel
compelled to say that, even if the Secretary of State had only rested his
decision on the first ground, ie that the funding failed the tests of Annex B
of Circular 16/91, his decision would, in my judgment, have been within the
limits of the discretion entrusted to him by section 70(1) read with sections
77(4) and 79(4). That discretion is wide enough to comprehend the publication
of circulars which are not made in the exercise of a statutory rule-making
power. The circulars are a by-product of the exercise of the Secretary of
State’s discretionary powers. Subject to the qualifications: (1) that the court
is the final judge under section 70(2) of what is capable of amounting to a
material consideration, or incapable of being a material consideration; and (2)
that the Secretary of State must take into account the particular features of
an individual case, such circulars fulfil a useful role. They promote
certainty, uniformity and even-handed justice in administrative decision-making
in the planning field: see Peter Cane, An Introduction to Administrative Law,
2nd ed pp 139-143. But, of course, such documents must not be construed like
statutes: they must be construed in a flexible way.
The judge held
that the Secretary of State erred in applying Annex B of Circular 16/91. The
judge held that the Secretary of State should have confined his consideration
of the matter to the three tests laid down in Newbury District Council v
Secretary of State for the Environment [1981] AC 578. In Newbury
the House of Lords held that a planning condition, to be valid, must pass thee
tests, namely: (i) it must have a planning purpose; (ii) it must relate to the
permitted development to which it is annexed; and (iii) it must be reasonable.
The Secretary of State may not dilute these requirements. On the other hand, it
does not follow at all that the Secretary of State may not in the exercise of
his wide statutory discretion lay down more stringent policy requirements.
That is
exactly what the Secretary of State has done. He has done so against the
background of a principle which is part of the very alphabet of our planning
law. The philosophy of the bazaar has been rejected. The governing principle is
that planning permission may not be bought and sold: Bradford City
Metropolitan Council v Secretary of State for the Environment (1986)
53 P&CR 55. It is in the language of Dworkin a principle and not a rule. It
is fuzzy round the edges. The application of the principle gives rise to
difficult problems. It is not always easy to say at what point a planning
authority is exceeding the limits of their power and is, in effect, selling
planning permission. This is the context in which the Secretary of State has
evolved the guidance contained in Circular 16/91 and in particular a test of
necessity which goes beyond the requirements of Newbury. I would hold
that in publishing a test of necessity in Circular 16/91 the Secretary of State
was acting lawfully. In my view, he was entitled to take the view that Tesco’s
offer of funding,
not a material consideration within the meaning of section 70(2). And I would
reject the contention that because Tesco offered the funding, that the
Secretary of State was not entitled to apply the policy set out in Annex B of
Circular 16/91.
It is true
that my reasoning cannot easily be reconciled with R v Plymouth City
Council, ex parte Plymouth & South Devon Co-operative Society Ltd (1993)
67 P&CR 78 to which the Master of the Rolls has referred. On the other
hand, the issue to which I have directed attention was not expressly considered
in Plymouth. Indeed, in the judgments of Russell LJ and Evans LJ there
is no express reference to the Circular 16/91. Yet the decision in Plymouth obliquely
destroyed the core of the circular. It seems to me that the decision in Plymouth
may require reconsideration. Quite apart from the fact that, in my
respectful view, the judgments in Plymouth failed to examine the role
and status of the circular, the decision comes perilously close to emasculating
the principle that planning permission may not be sold and bought.
In an article
in the January-February 1994 issue of the Conveyancer and Property Lawyer,
Professor Rowan-Robinson said about the decision of the Court of Appeal in Plymouth
(at p38):
The Plymouth
decision appears to take the relationship discussed above between
obligations and the proposed development an important stage further. As Purdue
points out in his comment on the decision at first instance, the planning
authority had no specific planning objections to either of the proposed
superstores so the benefits served no obvious alleviating or compensating
purpose. This suggests that relevant benefits may be offered and may influence
a grant of planning permission, even if the lack of them would not support a
refusal of permission. The benefits might, for example, result in one
development being preferred to another. This comes very close to the purchase
and sale of planning permissions. All that stands in the way is the requirement
that the benefits should be fairly and reasonably related to the subject matter
of the application and it will be apparent from the discussion above that a
fairly broad view is taken of this relationship.
The comment by
Purdue to which reference is made in the quotation is to be found in [1993] JPL
538. This seems to me an important point in an era of financial stringency in
which local authorities are apparently using development control as a means of
obtaining a wide range of community benefits. And it seems to me that Professor
Rowan-Robinson’s criticism is valid.
In my
judgment, the test of necessity propounded in Annex B of Circular 16/91,
although going further than Newbury, is perfectly valid as a policy
statement elaborating the principle that planning permission may not be bought
and sold. It does so by defining what are material considerations.
Reasonableness is, of course, a different matter. But there is no reason to
question the reasonableness of Annex B of Circular 16/91 on this point. And on
this supposition the Secretary of State was correct in his primary finding that
since the Tesco funding failed the test of necessity it was an immaterial
consideration.
For these
further reasons I would allow the appeals.
Finally, it is
right to add that, apart from the article from which I have quoted, I have read
a number of articles and notes, particularly on the Plymouth decision
and the subsequent decision in Good v Epping Forest District Council [1994]
1 WLR 3761. None of this material was mentioned in argument. I am
indebted to Mr Scott Collins, a lawyer in the Civil Appeals Office, for finding
these materials. I acknowledge that this material influenced my thinking. On
the other hand, since it did not alter my decision on any of the issues
discussed in this judgment it seemed unnecessary to ask for counsel’s written
or oral response to this material.
1Also reported at [1993] 3 PLR 135.
SIR THOMAS
BINGHAM MR: There are, in our judgment, three
powerful reasons which militate in favour of the grant of leave. The first is
that this case has given rise to an unusual difference of opinion. The
Secretary of State took a view different from the inspector. The learned deputy
judge, with his great knowledge of planning matters, concluded that the
Secretary of State had misdirected himself. We have taken a view different from
that of the learned deputy judge and have done so for reasons which are, in the
case of each of us, somewhat different. There is, therefore, an unusual
diversity of judicial and professional opinion.
The second
reason which militates in favour of the grant of leave is that this is, in our
judgment, a question of unusual public importance bearing on the conditions
which can be imposed, and the obligations which can be accepted, on the grant
of planning permission and the point at which the imposition of conditions, and
the acceptance of obligations, overlaps into the buying and selling of planning
permission, which are always agreed to be unacceptable.
The third
reason which militates in favour of granting leave is that the law, as we
conceive, and practice in this field call out for some comprehensive
consideration and overview. There are various decisions which have been given
in recent years which are not easy to reconcile and which may, indeed, betray
some inconsistency. It seems to us that the understanding of the law in this
field can be enhanced by a comprehensive review by the Appellate Committee.
Having given
those three powerful reasons for granting leave to appeal it may seem
surprising that we do not grant it. We hesitate for two reasons. The first of
those reasons is that on one view the outcome of these appeals turns on the
wording of the Secretary of State’s decision letter and if that view were taken
the case might be thought unsuitable as a platform for a comprehensive review
of the law in this field.
The second
reason is that on one view it might be thought that the decision of the
Secretary of State would have been the same, however, within the bounds of
reasonable possibility, he had directed himself. On that count also, the case
might be thought unsuitable for a comprehensive review.
We shall
accordingly refuse leave and leave the decision to their
these cases. We have taken the precaution of outlining our approach to the
question of leave in detail so that their lordships will know that we do regard
this case as one in which there are powerful grounds upon which to grant leave,
so that their lordships may consider the specific reasons which we think
inhibit us from granting leave at this stage.
Appeals allowed with costs; leave to appeal to
the House of Lords refused.
