Planning obligations requiring the transfer of land and the “directly related” test

In Tesco Stores Ltd v Secretary of State for the Environment [1995] 1 WLR 759, Lord Keith stated as follows: “An offered planning obligation which has nothing to do with the proposed development, apart from the fact that it is offered by the developer, will plainly not be a material consideration and could be regarded only as an attempt to buy planning permission”. That is now one of the three principles embodied in regulation 122(2) of the Community Infrastructure Levy Regulations 2010. This provides that a planning obligation may only constitute a reason for granting planning permission where it meets all of the followings tests, namely it is (1) necessary to make the development acceptable in planning terms (2) directly related to the development, and (3) fairly and reasonably related in scale and kind to the development. In R (on the application of Hampton Bishop Parish Council) v Herefordshire Council [2014] EWCA Civ 878, the appellant had sought unsuccessfully to quash outline planning permission granted by the local planning authority (“LPA”) for extensive new rugby club facilities, together with enabling residential development, on a site in the open countryside several kilometres from the existing ground belonging to the club intended to occupy the new facilities. One of the appellant’s grounds of challenge was that the LPA had erred in regarding as a material consideration a planning obligation requiring the club to transfer its existing ground to the LPA for a nominal sum. It contended, in particular, that the planning obligation was not directly related to the development. Counsel for the appellant pointed specifically to the distance between the site of the development and the ground, the fact that the transfer proposal had formed no part of the original planning application, the absence of any intended restriction on the future use of the ground – despite the representations in support of the continued use of the ground for sports – and the likelihood that the users of the development would have no continuing connection with the ground. The Court of Appeal rejected that argument, holding that the transfer obligation was directly related to the development. Richards LJ, agreeing with the reasons given by the judge at first instance, stated that the heart of the matter was that the ground was going to be released as a direct result of the proposed development. The future use of the ground was, therefore, one of the land use consequences of the very decision that the LPA had been faced with making. John Martin