Developer — Planning application — Secretary of State granting permission on appeal — Appeal site — Adjoining buildings constituting “ransom strip” — Whether Secretary of State erring in depriving landowner of value of ransom strip — Whether alternative proposal amounting to material consideration — First application dismissed — Second application allowed
Two applications were made under section 288 of the Town and Country Planning Act 1990 to quash a decision of the first defendant to grant planning permission to the second defendant developer, on appeal, for a development comprising buildings of between six and 22 storeys, including a retail supermarket, 307 residential units, 156 holiday let units and associated car parking and landscaping.
Following an inquiry, the first defendant accepted the planning inspector’s recommendation to refuse permission for one development option but giving permission for an alternative scheme that differed mainly with regard to the height of the proposed buildings.
Much of the site was derelict and partly situated in a conservation area. The first claimant was the freeholder and occupier of listed buildings, known as “283”, that were adjacent to, but not part of, the appeal site. The second claimant had submitted its own application for an alternative scheme that included 283, and which the inspector had referred to in his report. It had an option to purchase 283 and paid a non-returnable fee of £2.8m. A purchase price of £5.6m had also been agreed should the option be exercised.
The first claimant argued that by granting permission, the first defendant had acted unlawfully by depriving it of the value of 283, which was effectively a “ransom strip”. The second claimant submitted that the first defendant had erred in deciding that permission should be granted despite the continuing presence of 283.
The second claimant contended, inter alia, that the first defendant had failed to have regard to a material consideration, namely the alternative designs of the proposed buildings as required by PPS 1. It maintained that its own alternative scheme was relevant even though it was not a subject of the inquiry.
Held: The first application was dismissed. The second application was allowed.
The first defendant had been entitled to conclude, adopting the reasoning of the inspector, that if permission were to be granted, 283 was likely to be acquired and demolished in the foreseeable future, so that the question of whether ransom value would remain was a relevant consideration, and 283 could be tolerated in those circumstances. These were matters of planning judgment for the first defendant.
The fact that planning decisions commonly affected the value of adjacent land was not in itself a relevant consideration, although a loss of amenity might be. The proposition that planning powers must not be exercised so as to remove or diminish any ransom value was misconceived. Moreover the first claimant had received substantial sums for its property and would be entitled to receive further sums, greater in total than any market value.
With regards to the design of the proposed development, the first defendant had inaccurately represented the inspector’s views by referring to a statement that the inspector had considered the overall design on its merits, irrespective of the second claimant’s application.
Consideration of alternative sites would be relevant to a planning application only in exceptional circumstances, in particular where a more suitable site was a possibility. A similar approach would be appropriate where it had been contended that an alternative scheme on the same site had merit. The inspector had adopted the correct approach in saying that the second claimant’s application might be helpful if there were concerns that the appeal schemes were below the required standard and the alternative application showed a different and better solution: R (on the application of Jones and another) v North Warwickshire Borough Council [2001] 2 PLR 59 applied.
Paul Brown (instructed by Olswang) appeared for the claimant in the first action; William Hicks QC and Stephen Morgan (instructed by CMS Cameron McKenna LLP) appeared for the claimant in the second action; Nathalie Lieven QC and Daniel Kolinsky (instructed by the Treasury Solicitor) appeared for the first defendant; David Elvin QC and Reuben Taylor (instructed by Berwin Leighton Paisner) appeared for the second defendant; the third defendant in the first application and the interested party in the second application did not appear and were not represented.
Eileen O’Grady, barrister
