The belatedly reported decision of the Court of Appeal in R (on the application of Millgate Developments Ltd) v Wokingham Borough Council [2011] EWCA 1962; [2012] PLSCS 141 illustrates a particular risk where a developer decides to enter into a planning obligation in advance of the grant of planning permission on appeal, even one expressed to be conditional on planning permission being both granted and implemented. There are clearly circumstances in which the draftsman should consider imposing further conditionality. The decision also emphasises the strict contractual nature of planning obligations.
In that case, the local planning authority (LPA) had refused planning permission for a residential development, but indicated in the decision notice that the objections to the developer’s proposals might be overcome by a planning obligation providing for financial contributions towards leisure, education and library facilities. The developer appealed to the Secretary of State and submitted such a planning obligation – in the form of a unilateral undertaking – expressed to be conditional only on the grant and implementation of planning permission.
The inspector granted planning permission on appeal. However, in his decision letter he expressed doubt as to whether the contributions were necessary, and having concluded that they were not, he afforded the planning obligation little weight. On this basis, the developer asked the LPA to discharge the planning obligation. The LPA informed the developer that it considered that the planning obligation remained enforceable, and that it intended to require the contributions to be made. The developer sought judicial review of that decision, its principal ground being that the LPA had acted unreasonably.
The Court of Appeal upheld the first instance decision dismissing the developer’s application. The planning obligation had become enforceable according to its own terms. In the circumstances, the LPA was entitled to enforce it. In so doing, it was not making a planning decision, but merely deciding to enforce a planning obligation. Further, it was questionable whether a remedy by way of judicial review was appropriate in a case of this kind. The planning obligation had been lawful when entered into, and would be enforced by a private law action in contract. In such event, the points that the developer claimed to make by way of judicial review could be employed as a defence to that action. An alternative remedy was available.
John Martin