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HJ Banks & Co Ltd v Secretary of State for Housing, Communities and Local Gov…

Town and country planning – Environment – Mining – Inspector recommending grant of planning permission for extraction of coal – Defendant secretary of state rejecting recommendation and refusing permission because of adverse effects of emission of greenhouse gases – Claimant applying to overturn decision – Whether defendant failing properly to apply two-stage test in para 149 of National Planning Policy Framework – Application granted

The claimant applied for planning permission from the first interested party local authority for a surface mine for the extraction of coal, sandstone and fireclay from land at Highthorn, on the coast at Druridge Bay in south-east Northumberland. The land was to be restored to agricultural and ecological uses after the conclusion of the mining operations which were expected to take seven years. Up to three million tonnes of coal would be extracted. The first interested party resolved to grant planning permission, but the defendant secretary of state exercised his statutory power to call the application in for his own determination. After a public inquiry, the inspector recommended that planning permission be granted. The proposal accorded with national policy and the planning balance, under para 149 of the National Planning Policy Framework (NPPF), favoured the development. The defendant accepted most of the inspector’s conclusions, but rejected his recommendation and refused permission because of the very considerable weight he gave to the adverse effects of the emission of greenhouse gases (GHG).

The claimant challenged that decision under section 288 of the Town and Country Planning Act 1990. The first interested party did not take part in the proceedings.

Held: The application was granted.

(1) Paragraph 149 of the NPPF contained a two-stage test. Coal extraction was not permitted unless it was environmentally acceptable, or could be made so with conditions and obligations. If it remained environmentally unacceptable, the benefits of the proposal were brought into play to see if they clearly outweighed the likely impacts. The decision maker had to consider all that might be described as “environmental”, whether adverse or beneficial, so that a proposal for coal extraction which was environmentally acceptable, after allowing for mitigation achieved by conditions and agreements, would be permitted before the “need” case or “national, local or community” benefits fell for consideration; and then consider all the adverse impacts as mitigated, environmental or not, and whether or not considered at the first stage, and all the benefits, including any which had already been considered at the first stage, and which had been found insufficient to outweigh the adverse impacts. It was difficult to see what benefits there might be which did not come within the scope of “national, local or community benefits”. All the benefits and adverse effects had to be taken into account without double counting or discounting.

(2) The defendant considered all the impacts and benefits before turning to apply para 149. He did not disagree with the assessment of or weight given to any of those by the inspector, save in the overall balance. The defendant disagreed with the inspector about the scope of “national, local and community benefits” pointing out that the inspector’s approach was too narrow. On a proper interpretation of the decision letter, biodiversity benefits had not been taken into account at the first stage. The defendant made no reference to the land management agreements made with the local authority under section 39 of the Wildlife and Countryside Act 1981, for the general purpose of conserving and enhancing the natural beauty of land or for promoting its public enjoyment. The defendant, unlike the inspector, had not grappled with the distinction between mitigation and benefit arising in the section 39 agreements relating to biodiversity. If the biodiversity benefits, which went beyond mitigation, were not taken into account at the first stage, they had to be taken into account at the second stage. The defendant had ignored the biodiversity benefits in his overall conclusions, failing to carry them forward to the second stage exercise, and failing to have regard to all the considerations material to that stage. Paragraph 149 did not permit all the harm to be considered at the second stage with only part of the benefits. If a residual approach was followed, both benefits and harms had to be netted off to come to a single notional value for a reduced harm then used at the second stage; that he had not done. The biodiversity benefit was an important part of the claimant’s case; it was found to be overall a moderate benefit. Such a benefit could be decisive where permission was refused because the benefits did not “clearly outweigh” the harm. The claimant was entitled to know whether it had been taken into account at the second stage or not, and if not why not. Where the reasoning left such great uncertainty on such a point, it was legally inadequate to the prejudice of the claimant who lacked a clear answer enabling it to identify whether a legally impermissible approach had been taken to biodiversity benefits. The reasoning was inadequate for the defendant’s asserted treatment of a benefit of some significance, an important issue in the case for the claimant. On that basis the decision would be quashed.

(3) Although it had been argued that the defendant had taken into account irrelevant benefits, to which he attached the same weight as he would have attached to biodiversity benefits, which cancelled out the biodiversity error, the court was not satisfied that the biodiversity benefits could not tip the balance into a clear outweighing of the likely adverse impacts.

(4) The defendant had failed to provide adequate reasons for his conclusions on increase in GHGs. Having accepted all of the inspector’s conclusions, including that there was a need for the coal to meet the UK’s energy needs, and that the mine would result in savings in greenhouse gas emissions compared to the burning of imported coal, he should have explained how a proposal needed for the country’s energy could be refused on the basis of the adverse impact of greenhouse gases, unless the gap was filled by renewables or low carbon sources. He had failed to identify any policy statement on reducing coal use or on increasing the use of renewables with which the proposal would be inconsistent.

(5) Although the defendant acted inconsistently with previous decisions which had excluded the significance of greenhouse gases emitted by the burning of coal, the deliberate adoption of a different approach from earlier decisions did not of itself call for specific reasoning. The cases in question were not indistinguishable on a critical issue; they were distinguishable by reference to the arguments raised and addressed, and by the passage of time. What mattered primarily was that the reasons for the instant decision were clear.

Nathalie Lieven QC and Flora Robertson (instructed by Eversheds) appeared for the claimant; David Elvin QC and Richard Moules (instructed by the Government Legal Department) appeared for the defendant; the first interested party did not appear and was not represented; Paul Brown QC and Matthew Fraser (instructed by the Solicitor to Friends of the Earth Ltd) appeared for the second interested party; Estelle Dehon (instructed by Richard Buxton Solicitors) appeared for the third interested party.

Eileen O’Grady, barrister

Click here to read a transcript of HJ Banks & Co Ltd v Secretary of State for Housing, Communities and Local Government

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