Local authority – Development – Community infrastructure levy (CIL) – Claimant developer applying for judicial review of defendant council’s CIL charging structure – Whether examiner adopting irrational approach – Whether examiner taking account of immaterial consideration – Whether adopting charging schedule without regard to development plan policy on new housing unlawful – Application dismissed
The community infrastructure levy (CIL), introduced by the Planning Act 2008, enabled a local planning authority to raise funds from the development of land in its area to pay for infrastructure of various kinds. The claimant, which owned a large amount of land in the North West of England, promoted schemes of housing development and wanted to make sure that the value of its land was not unduly reduced by CIL. Accordingly it applied for judicial review of the CIL charging schedule for residential development adopted by the defendant council and by the two interested parties, which were the neighbouring authorities in central Lancashire. Each of the three councils was a charging authority under section 206(2) of the 2008 Act.
The councils consulted on their proposed CIL charges and submitted their revised draft charging schedules for examination. The claimant objected to the proposed rate of CIL for residential development, excluding apartments, of £65 per m2. An examination into the submitted charging schedules was held by an examiner appointed by the councils. He concluded that the charge was justified and should be approved. The councils adopted the charging schedule under regulation 25 of the Community Infrastructure Levy Regulations 2010.
The claimant applied for an order to quash the defendants’ charging schedule for residential development. Similar proceedings were launched against the interested parties but were stayed until the present claim had been decided. The issues were: (i) whether the examiner’s approach to the evidence before him was irrational; (ii) whether the examiner had taken into account an immaterial consideration, i.e. that cost was directly proportionate to the size of a dwelling; and (iii) whether it was unlawful to adopt the charging schedule for dwelling-houses without allowing for the requirement in development plan policy that new housing had to meet level 6 of the Code for Sustainable Homes.
Held: The application was dismissed.
(1) On a claim for judicial review, the court could not interfere with the examiner’s judgment on matters of valuation or planning merit. To justify intervention by the court, in a challenge based on an allegation of irrationality in an examiner’s conclusions, the decision under challenge had to fall outside the bounds of any decision open to a reasonable decision-maker: Newsmith Stainless Steel v Secretary of State for the Environment Transport and the Regions [2001] EWHC Admin 74; [2001] PLSCS 30 considered.
Regulation 14 of the CIL Regulations required a charging authority to make a number of judgments when setting rates in a charging schedule. The authority had to aim to strike an appropriate balance between the desirability of funding the cost of necessary infrastructure and the possible effects of CIL on the viability of development. Within that broad balance, the examiner had to consider the desirability of funding the total cost of infrastructure wholly from CIL, what infrastructure was required to support the development of the charging authority’s area, and when it would have to be provided, other likely sources of funding and the likely ability of development to bear the burden of CIL and still provide enough profit for developers to make it worthwhile. The statutory requirement in section 211(7A) of the 2008 Act, for a charging authority to use appropriate available evidence did not specify what that might be in a particular case. The nature of the exercise for the charging authority was made clear in the government’s guidance document but the judgments to be made under regulation 14 were ultimately for the charging authority. Under the statutory scheme an examiner had to consider, in the light of the evidence and representations before him, whether an appropriate balance had been struck in formulating its charging schedules. That was a classic exercise in judgment of the kind that independent inspectors were able to make, but the court was not. The court would only interfere on Wednesbury grounds. In the present case, the examiner’s conclusions had been both reasonable and sufficiently reasoned, and were at least adequate for the purposes of the assessment he had to make. They were founded on appropriate available evidence, in accordance with section 211(7A) of the 2008 Act, and were both realistic and complete.
(2) On a true reading of his report, the examiner had neither failed to understand the evidence before him on the size of dwellings and the density of development nor committed any error of law in the conclusion to which he came. The examiner had to exercise his judgment. He did not have to decide whether the defendants’ assumptions on the size of dwellings and the density of development were demonstrably correct. He had to ask himself whether he could rely on their appraisals, even if the assumptions themselves were questionable or arguably wrong, and had found that he could. Since the examiner had been satisfied that the assessment was basically sound, he did not have to consider what the effect of making different assumptions might have been. There was no error of law in the examiner’s conclusion that the information on which the defendants’ assumptions on dwelling size and density were based was appropriate, available evidence. His reasons for that conclusion were clear and not unlawful.
(3) Nothing the statutory provisions or the government’s guidance required the examiner to ask the defendants for evidence that the CIL charge would not prejudice the viability of housing development to meet level 6 of the code for sustainable homes. Nor did he have to recommend against the adoption of the proposed charging schedule because he had not been given such evidence. The examiner’s conclusions were reasonable and consistent both with the statutory requirements in section 211, 212 and 213 of the 2008 Act, regulation 14 of the CIL regulations, and the corresponding advice in the government’s guidance document. The need for a charging authority to put in place CIL charging schedules that would remain up to date was partly a consequence of regulation 123 of the CIL Regulations, limiting the use of planning obligations entered into under section 106 of the Town and Country Planning Act 1990. There was a strong statutory incentive for a charging authority to keep its CIL effective as a means of securing, through development, the funding it needed for the provision of infrastructure in its area. The examiner’s report showed that he was aware of the need for developers not to be deterred by unrealistically high rates of CIL.
Paul Tucker QC and John Barrett (instructed by Irwin Mitchell LLP) appeared for the claimant; David Elvin QC and Graeme Keen (instructed by the Head of Legal Services, Chorley Borough Council) appeared for the defendants.
Eileen O’Grady, barrister
