Town and country planning — Planning gain — Whether local planning authority took into account an immaterial consideration, namely offer of planning gain, in granting planning permission for a food supermarket
On April 23
1992 the first respondents, Plymouth City Council, resolved to grant planning
permission in respect of two areas of land in Marsh Mills, Plymouth. On one
plot the second respondent, J Sainsbury plc, proposed to erect a food
supermarket comprising 76,500 sq ft and, on the other plot, the fourth
respondent, Tesco Stores Ltd, proposed to erect a food supermarket of some
70,000 sq ft. On the same day the council deferred consideration of a planning
application by the appellants, Plymouth & South Devon Co-operative Society
Ltd, for the erection of a supermarket about 3 miles to the east of Marsh Mills
at Chaddlewood. In January 1992 a draft first alteration to the local plan was
approved by the council and three out-of-town sites for large food stores were
selected, only one being at the Marsh Mills location. The draft also recognised
that stores were expected to provide community benefits, but that applications
would be decided with respect to the principles and policies of good planning
practice, irrespective of the level of community benefits proposed or
achievable. There were two candidates for permission in Marsh Mills and
Sainsbury and Tesco were invited to make submissions, including suggestions for
community benefits which the individual organisation could offer pursuant to
the draft policy. The community benefit offered by Sainsbury included the
construction of a tourist information centre, a bird-watching hide and a static
art feature on the site. Off the site they offered park-and-ride facilities
with a contribution of £1m towards the cost of providing the necessary highway
and drainage infrastructure for an industrial site at Derriford Barton. The
last offer being in recognition of the fact that, if Sainsbury were permitted
to build a superstore at Marsh Mills, there would be a loss of industrial land.
The Tesco offer included a financial contribution to the provision of a creche,
a wildlife habitat on a site contiguous to the proposed development, a moving
water sculpture on site and the sale to the council of land for park-and-ride
facilities. The appellant Co-op, who have since been granted permission to
develop a supermarket at Chaddlewood to the scale originally proposed subject
to a section 106 agreement, made an application by way of judicial review of
the decision of the council resolving to grant the two planning permissions to
Sainsbury and Tesco on the grounds that the only material considerations which the
council were entitled to take into account in relation to the offer of
community benefits were those necessary to overcome, remedy or alleviate
planning objections to a proposal. Hutchison J dismissed the application for
judicial review. The Co-op appealed.
condition in Newbury District Council v Secretary of State for the
Environment [1981] AC 578 applied to determining the materiality of a
section 106 obligation. The question, therefore, was whether each and every one
of the community benefits offered were capable of being regarded as having a
planning purpose and whether each and every one of them related to the
permitted development. So far as benefits which were to be provided on site,
there was not the slightest difficulty or room for argument because they made
the development more attractive, which was surely in the public interest. As to
off-site benefits, the offers of contributions towards the alleviation of
traffic problems in the way of park-and-ride facilities, and the £1m offer by
Sainsbury, both plainly had planning purposes. The latter offer was a
contribution towards restoring the balance in the provision of sites for
employment land distributed by the grant of permission at Marsh Mills.
insufficient interest to seek judicial review would have failed. If planning
permission were granted for a superstore development without due regard to the
limits of material considerations, the appeal procedures would be irrelevant,
and the sections of the public most directly affected would be the local
community and the local traders who would be likely to bear, as individuals,
their share of any economic loss. The fact that the appellants are themselves
developers of a similar, though smaller, scheme does not affect their status in
this respect.
by principle or authority an additional test to the validity of a material
consideration, that in order to be material an offer of community benefits must
not only be planning benefits which fairly and reasonably relate to the
development but, they must also be necessary in the sense that they overcome
what would otherwise have been a planning objection to the development, so
that, without the benefiting question, planning permission would have been
refused.
The following
cases are referred to in this report.
Bradford
City Metropolitan Council v Secretary of State
for the Environment (1986) 53 P&CR 55; [1986] 1 EGLR 199; 278 EG 1473;
[1986] JPL 598, CA
Good v Epping Forest District Council [1992] 3 PLR 103
Hall
& Co Ltd v Shoreham-by-Sea Urban District
Council [1964] 1 WLR 240; [1964] 1 All ER 1; (1963) 62 LGR 206; 15 P&CR
119; [1963] EGD 638; 188 EG 873; [1964] JPL 316, CA
Newbury
District Council v Secretary of State for the
Environment [1981] AC 578; [1980] 2 WLR 379; [1980] 1 All ER 731; (1980) 78
LGR 306; 40 P&CR 148; [1980] JPL 325, HL
Northumberland
County Council v Secretary of State for the
Environment (1990) 59 P&CR 468; [1989] JPL 700
R v Secretary of State for the Home Department, ex parte Brind
[1991] 1 AC 696; [1991] 2 WLR 588; [1991] 1 All ER 720, HL
R v Westminster City Council, ex parte Monahan [1990] 1 QB 87;
[1989] 3 WLR 408; [1989] 2 All ER 74; (1989) 58 P&CR 92; [1989] 1 PLR 36;
[1989] JPL 107, CA
Safeway
Properties Ltd v Secretary of State for the
Environment (1991) 63 P&CR 73; [1991] 3 PLR 91, CA
This was an
appeal by the applicant, Plymouth & South Devon Co-operative Society Ltd,
against a decision of Hutchison J who on February 1 1993 dismissed the
appellant’s application for judicial review of a planning decision of the first
respondents, Plymouth City Council, relating to development sites in which the
second to fifth respondents, J Sainsbury plc, Estates & Agency Holdings
plc, Tesco Stores Ltd and Vosper Motor House (Plymouth) Ltd, had interests.
Andrew Gilbart
QC and Paul Tucker (instructed by Cobbett Leak Almond, of Wilmslow) appeared
for the appellant; Anthony Porten QC and Mary Cook (instructed by the solicitor
to Plymouth City Council) represented the first respondents; Michael Barnes QC
and David Elvin (instructed by Denton Hall Burgin & Warrens) for Sainsbury
and (instructed by Paisner & Co) for Estates & Agency Holdings plc,
represented the second and third respondents; Robert Carnwath QC and John
Furber (instructed by Berwin Leighton) represented the fourth and fifth
respondents.
Giving the
first judgment, RUSSELL LJ said: This is an appeal by Plymouth &
South Devon Co-operative Society Ltd (the Co-op) against a judgment of
Hutchison J who on February 1 1993 dismissed the appellant’s application for
judicial review of a planning decision of Plymouth City Council of April 23
1992. The decision related to the proposed grant of planning permission in
respect of two areas of
to erect a food supermarket comprising some 76,500 sq ft. On the other plot
Tesco Stores Ltd (Tesco) proposed to erect a food supermarket of some 70,000 sq
ft. The two sites were at a vast vehicular roundabout at Marsh Mills on the
eastern approach to the city. The Tesco supermarket was to be to the north of
the roundabout and the Sainsbury supermarket to the south.
On the same
day that the planning authority resolved to grant the two permissions, they
deferred consideration of a planning application by the appellants for the
erection of a supermarket about 3 miles or so to the east of Marsh Mills in the
district of Plymton at a location known as Chaddlewood.
The
applications by Sainsbury and Tesco were each accompanied by offers to enter
into agreements with the planning authority pursuant to section 106 of the Town
and Country Planning Act 1990. Various community benefits were proposed by the
applicants to which I will make reference later.
As to the
appellant’s application relating to Chaddlewood, it was deferred on the same
date as the planning authority resolved to grant permission for the two
supermarkets at Marsh Mills so that consideration could be given to reducing
the size of the Chaddlewood supermarket. The Co-op, however, have since been
granted permission to develop a supermarket at Chaddlewood to the scale originally
proposed subject, in their case also, to a section 106 agreement.
The challenge
to the decision taken for development at Marsh Mills contains essentially two
limbs. It is contended, first, that in resolving to grant permission the
planning authority took into account factors which were not material to the
planning permission contrary to the provisions of section 70(2) of the Town and
Country Planning Act 1990 and, in particular, the section 106 agreements
contained provisions which the planning authority were not entitled to accept
as relevant issues in their decision-making process. Second, it is submitted
that the decisions to grant permission were flawed in that the city planning
officer misled the planning committee when he reported to them prior to the
decisions being taken.
In this
judgment I shall not attempt to emulate the judgment of Hutchison J which
extended to some 54 pages of transcript for, as the appeal has developed, so
the issues for our determination have crystallised and now fall within a much
narrower compass than that which confronted the judge.
In 1991 the
planning authority commissioned a report which recommended strictly limited
increases in large food stores, but in January 1992 a draft first alteration to
the local plan was approved. Three out-of-town sites were selected, only one
being at the Marsh Mills roundabout. The draft also recognised that stores were
expected to provide community benefits, and as a matter of policy provided:
The
requirement of community benefits must always be justifiable in land use
planning terms. Applications will be decided with respect to the principles and
policies of good planning practice, irrespective of the level of community
benefits proposed or achievable.
After the
approval of the first draft alteration to the local plan, Mr Warren Evans, a
senior official of Sainsbury, made extensive suggestions to the planning
authority recorded in correspondence. There were two candidates for permission
in Marsh Mills (Tesco and Sainsbury). To summarise what happened, Mr Warren
Evans suggested that permission should be given to both organisations to open
supermarkets at Marsh Mills. The council responded by inviting each applicant
to make submissions including suggestions for community benefits which the individual
organisation could offer pursuant to draft policy IR4 already approved by the
planning authority at the time the draft alteration to the local plan was
published. Tesco and Sainsbury made their respective offers.
Sainsbury’s
was the more ambitious. A number of attractive features on their site were
contemplated, such as the construction of a tourist information centre, a
bird-watching hide overlooking the River Plym and a static art feature, whereas
off the site — though in close proximity to it — there was to be park-and-ride
facilities together with the offer of a contribution up to £1m towards the cost
of providing the necessary highway and drainage infrastructure for an
industrial site at Derriford Barton. This last offer was in recognition of the
fact that, if Sainsbury were permitted to build a superstore at Marsh Mills,
there would be a loss of industrial land which hitherto had been available for
that type of development.
The Tesco
package included a financial contribution to the provision of a creche, a wild
life habitat on a site contiguous to the proposed development, a moving water
sculpture on site and the sale to the council of a site for park-and-ride
facilities.
Mr Roger Dean,
a senior planning officer with Plymouth, was impressed with both offers and in
a lengthy and detailed report to the planning committee recommended acceptance.
He concluded:
In all the
circumstances I conclude that it would not be reasonable to refuse either
application and I therefore recommend that the council be minded to grant both
the Sainsbury and the Vosper/Tesco schemes, subject to all the appropriate
conditions, provided that both applicants enter into planning agreements to
bring about all the highway improvements, as identified by the county engineer
and planning officer and Department of Transport, and the community benefits
identified in the respective packages. In the case of Vosper/Tesco, it is
imperative that the two developments go ahead together to realise the
employment advantages. It will therefore be necessary to insist that the store
will not be open for trading until all the Motor House development is fully
completed.
This last
reference was to the projected movement of Vosper Motor House, a large local
business, to another site in Plymouth which depended upon the sale of the land
at Marsh Mills to Tesco.
To complete
this outline of the background facts, Mr Dean considered that if the Marsh
Mills stores went ahead the demand at Chaddlewood would be affected and that,
consequently, the scale of the store proposed by the Co-op was too big. He
suggested that the planning authority should negotiate with the Co-op for a
reduction of the Chaddlewood store in terms of its size. All Mr Dean’s
proposals and advice were accepted by the committee and the planning decisions
were taken as earlier indicated in this judgment.
Mr Andrew
Gilbart QC, on behalf of the appellants, first took us to the provisions of
section 70(2) of the 1990 Act. The section is headed ‘Determination of
Applications’ and subsection 2 reads:
In dealing
with such an application the authority shall have regard to the provisions of
the development plan, so far as material to the application, and to any other
material considerations.
Mr Gilbart’s
submissions concentrated upon the proper construction of the words ‘any other
material considerations’, it being contended that only community benefits which
were necessary to overcome or remedy or alleviate planning objections to a
proposal could be taken into account. If a community benefit failed to pass
that test, it became immaterial and any planning decision which was effected by
it was liable to be struck down upon judicial review.
I say at once
that, in my judgment, Mr Gilbart’s proposition is far too strict and narrow to
give effect to the terms of the statute and is unsupported by any authority. In
Newbury District Council v Secretary of State for the Environment
[1981] AC 578, Viscount Dilhorne said of a planning condition (and the same
must be true of a section 106 obligation) at p607G:
In order to be
valid, a condition must satisfy three tests. First, it must have a planning
purpose. It may have other purposes as well as its planning purpose. But if it
is imposed solely for some other purpose or purposes, such as furtherance of
the housing policy of the local authority, it will not be valid as a planning
condition. See R v Hillingdon London Borough Council, ex parte Royco
Homes Ltd [1974] QB 720. Second, it must relate to the permitted
development to which it is annexed. The best known statement of these two tests
is that by Lord Denning in Pyx Granite Co Ltd v Ministry of Housing
and Local Government [1958] QB 554, which has been followed and applied in
many later cases. Lord Denning said, at p572:
‘Although the
planning authorities are given very wide powers to impose ‘such conditions as
they think fit’ nevertheless the law says that those conditions to be valid,
must fairly and reasonably relate to the permitted development. The planning
authority are not at liberty to use their powers for
public interest,’
. . .
Thirdly, the condition must be ‘reasonable’ in the rather special sense of Associated
Provincial Picture Houses Ltd v Wednesbury Corporation [1948] 1 KB
223, 229. Thus it will be invalid if it is ‘so clearly unreasonable that no
reasonable planning authority could have imposed it’ as Lord Widgery CJ said in
Kingston Upon Thames Royal London Borough Council v Secretary of
State for the Environment [1973] 1 WLR 1549, 1553.
In the instant
case, there has never been any suggestion of bad faith or of ulterior motive in
any sinister sense on the part of Plymouth City Council. Mr Gilbart also
conceded that it is for the court to decide whether an obligation pursuant to a
section 106 agreement is capable of being regarded as a material consideration,
while the weight of such a consideration and its part in the decision-making
process — provided it passes the test of materiality as defined by Viscount
Dilhorne — must always remain a matter for the planning authority. For my part,
I do not think it is helpful to embark upon a closer analysis of the dicta in Newbury
than is necessary to give effect to them in the individual circumstances of the
individual case. I reject as unarguable that any of the obligations volunteered
by Sainsbury and Tesco and the acceptance of them even approached Wednesbury
unreasonableness, and I simply ask myself whether each and every one of them
were capable of being regarded as having a planning purpose and whether each
and every one of them related to the permitted development. So far as benefits
which were to be provided on site, there does not appear to me to be the
slightest difficulty or room for argument. They made the development more attractive
and that must surely be in the public interest.
As to off-site
benefits, in particular, the offer of a sum of up to £1m by Sainsbury and the
offers of contributions toward the alleviation of traffic problems in the way
of park-and-ride facilities, both plainly had planning purposes. It is common
knowledge that park-and-ride facilities reduce vehicular traffic; a superstore
would create vehicular traffic; the one would counteract the other and
accordingly, in my view, the park-and-ride facilities plainly related to the
development proposed and was for a planning purpose.
The offer of
£1m was not in any sense divorced from Sainsbury’s application to develop their
store. The evidence from Mr Dean was that sites available for industrial
development within the city of Plymouth were not plentiful, and that by
permitting the development at Marsh Mills for retail outlets the planning
authority was further reducing the pool of resources for employment land. The
offer in relation to Derriford Barton was a contribution towards restoring the
balance disturbed by the grant of permission at Marsh Mills. In my judgment,
this, too, passed the Newbury test and the planning authority were
entitled to take it into account as material to their planning decision. It is
not material to inquire into the precise part played by these benefits in the
decision reached by the planning authority. The reasons for granting permission
are not disclosed, though in passing it is worthy of observation to note that
Hutchison I did not seem to regard the benefits as ‘determining factors which
led to the council’s decisions’. Those decisions, he thought
were based on
planning issues and particularly on the fact that no demonstrative harm to
interests of acknowledged importance flowed from either or both proposals.
Apart from the
Newbury case a number of authorities were cited to us. They illustrate
the wide spectrum of materiality. In Bradford City Metropolitan Council
v Secretary of State for the Environment (1986) 53 P&CR 55 at p64
Lloyd LJ said that it was ‘axiomatic that planning consent cannot be bought or
sold’. Mr Gilbart suggested that in reality this had happened at Plymouth and
he purported to find support for that from the fact that Sainsbury had
indicated that in the event of planning permission not being granted and it
becoming necessary to appeal to the Secretary of State the offer of community
benefits would be withdrawn. I do not agree. Section 106 expressly contemplates
in subsection 2 the payment of money and, in my view, the threatened withdrawal
of the offer, if anything, demonstrates that Sainsbury did not regard their
application as dependent upon the money and therefore necessary to the
permission, although it was a feature which the planning authority was entitled
to regard as relevant to their own decision at that stage.
For my part, I
do not find all the many authorities that were cited to us of great assistance
in determining the questions which arise in this appeal. As so often happens
they turned very much on their own facts, and I certainly did not detect in any
of them a departure from the Newbury test or any gloss which it is
necessary to place upon it. A short but valuable contribution to the debate is
to be found in the judgment of Staughton LJ in R v Westminster Council,
ex parte Monahan [1990] QB 87 at pp 121, 122.
In the light
of the foregoing I am firmly of the opinion that Hutchison J was right to find
that the planning decisions in favour of Sainsbury and Tesco were intra
vires the planning authority and entirely within its discretion. This part
of the appeal fails.
The second
limb of Mr Gilbart’s attack I can deal with more shortly. Chaddlewood was a
proposed new district centre. The draft first alteration to the local plan recommended
a new food store at Chaddlewood and it was that alteration which designated
Chaddlewood as a new district centre. However, when Mr Dean reported to the
committee he said that ‘the draft first alteration recognises that it is not
realistic to support any more large retail provision in district centres’.
Taken literally that was plainly wrong. There were to be no additional food
stores in existing district centres and, in my view, the report of Mr
Dean read as a whole makes the true position abundantly plain. I cannot believe
that there was any real risk that any member of the committee was misled by
what was no more than a slip of the tongue on the part of Mr Dean. In any event
the relevant extracts from the draft local plan including the proposal for the
new store at Chaddlewood were appended to Mr Dean’s report.
We did not
hear full argument upon whether the appellants ever had sufficient interest to
seek judicial review and I find it unnecessary to express any concluded view,
although my provisional one would be that the respondents’ objections on this
score would have failed. I would dismiss this appeal.
Agreeing, EVANS
LJ said: The background to these applications for planning permission for
out-of-town superstores as described by Hoffmann LJ is further elaborated in a
note to section 106 of the Town and Country Planning Act 1990, as amended by
the Planning and Compensation Act 1991, section 12, in the Encyclopedia of
Planning Law and Practice vol 2 at para p106.08 under the heading ‘The
broader context’. The statutory provisions now reflect the political objective
of permitting the greater use of private capital for what are described as
‘off-site infrastructure costs’, which formerly were borne by the public sector
alone. Hence, the increasing prominence of ‘community benefits’ and ‘planning
gain’.
These appeals
provide an opportunity for the court to emphasise that the underlying legal
principle is unchanged. The planning authority is required by section 70(2) to
have regard to ‘material considerations’ and these must satisfy the three-fold
test stated by Viscount Dilhorne in Newbury District Council v Secretary
of State for the Environment [1981] AC 578 in the passage quoted by Russell
LJ. Mr Gilbart QC has sought to introduce a further limitation, to the effect
that the condition must also be ‘necessary’ in the sense that it overcomes what
would otherwise be an obstruction to the grant of permission; but this would
complicate the decision-making process and it would add, in my judgment, an
unwarranted gloss to the meaning of the statutory provisions. But the fact that
this attempted limitation fails does not mean that the concept of materiality
is widened in any way.
Neither the Newbury
case nor R v Westminster City Council, ex parte Monahan [1990] QB
87 (the Covent Garden decision), as I read the judgments, involved
‘planning gain’ in the sense of off-site infrastructure costs. The only reported
decisions where such have been held to be material and therefore lawful are
comparatively recent: see in particular Safeway Properties Ltd v Secretary
of State for the Environment [1991] 3 PLR 91 and perhaps also Northumberland
County Council v Secretary of State for the
by Lloyd LJ in the Bradford case (1986) 53 P&CR 55*, that planning
permission should not be bought and sold, is to be preserved. The test of
materiality, strictly applied, in my judgment is a sufficient safeguard against
its abuse.
*Editor’s
note: Bradford City Metropolitan Council v Secretary of State for the
Environment.
Russell LJ has
referred to the further issue whether the appellants had sufficient interest to
seek judicial review. Like him, I wish to record my provisional view that the
respondents’ objection on this ground would have failed. If planning permission
were granted for a superstore development without due regard to the limits of
material considerations, then appeal procedures would be irrelevant, and the
sections of the public most directly affected would be the local community, as
in the Covent Garden case, and the local traders who would be likely to
bear, as individuals, their share of any economic loss which that community
suffered. The fact that the appellants are themselves developers of a similar,
though smaller, scheme does not affect their status in this respect.
Also agreeing,
HOFFMANN LJ said: Until a few years ago, almost everyone did their
household shopping in the High Street. Town planners insisted that big shops
and supermarket developments should be allowed only in urban or suburban
centres. But these are often crowded and inconvenient for parking. So retailers
began to build out-of-town superstores, easily accessible by car and surrounded
by ample parking. These proved very popular. They sold not only food and
groceries but also things like do-it-yourself goods, plants and garden
equipment. Some included restaurants and children’s playgrounds, to enable the
weekly shopping to be accompanied by refreshment, social intercourse and
diversion for the children.
Planning
authorities have had to adapt their policies to the pressure of demand for
these new superstores. This appeal concerns the grant of planning permissions
for two such stores at the Marsh Mills roundabout, on the eastern approaches to
the city of Plymouth. Like many other planning authorities, Plymouth used to
have a policy of confining big supermarkets to ‘district centres’. This was
adopted in their local plan in 1987. But in 1988 the Government published a new
Planning Policy Guidance Note (PPG 6) on major retail development. It said:
17. Large
stores of up to about 100,000 sq ft (10,000m2) selling mainly food
and other convenience goods are now a well established form of retail
development and clearly meet strong customer demand for convenient car-borne
weekly household shopping. The planning system has been able to cater for them,
and several hundred such stores have been built.
18. Large
retail warehouses have similarly shown themselves to be a successful way of
catering for major household goods, bulky DIY items etc. Taking part of these
heavy car-borne shopping requirements out of the town centre can positively
help by relieving the centre of traffic congestion and making them pleasanter
places for the more relaxed and varied shopping activities and other town
centre uses.
19. Both
these types of retail development can often make good use of derelict and
neglected sites within urban areas and result in positive environmental gain
and new local employment opportunities.
As a result of
this statement of policy, Plymouth found that, on three occasions when they
refused permission for an out-of-town store, their decision was overturned on
appeal to the Secretary of State. So they decided to trim their sails to the
prevailing wind and adopt a new policy. In a draft first alteration to the
local plan, published in January 1992, they selected three out-of-town sites
for large food stores. One of these was the Marsh Mills roundabout. The draft
plan also said that the stores were expected to provide ‘substantial community
benefits’ in accordance with IR4, another new policy stated in the draft. IR4
said that, in dealing with applications for planning permission, the council
would consider how the community may benefit as a result of the proposed
development. They listed 11 categories of community benefits, such as the
provision of low-cost housing, public open spaces, wild life habitats,
contributions to public transport infrastructure and the undertaking of
environmental improvements. A note to this policy explained:
An important
and integral part of the Council’s approach to planning is to negotiate with
private developers to try to ensure that the local community benefits more
directly and is not disadvantaged by new development . . . The requirement of
community benefits must always be justifiable in land-use planning terms. Applications
will be decided with respect to the principles and policies of good planning
practice, irrespective of the level of community benefit proposed or
achievable.
This was the
policy background to the council’s consideration of two applications for
permission to build large food stores at the Marsh Mills roundabout. Tesco
wanted to build on a site south of the roundabout formerly used by an
engineering company and recently acquired by Vosper Motor House, a large local
car dealer. Vosper had bought the site to use part for the relocation of its
business, employing about 1,000 people, from another site near Plymouth docks.
It said, however, that the viability of the move depended upon being able to
sell the rest of the site to Tesco. The second application was from Sainsbury,
which wanted to build on another former industrial site to the north-west of
the roundabout.
At first the
council planning officers indicated to Tesco and Sainsbury that the council was
likely to adhere to the policy stated in the draft first alteration of allowing
only one store at Marsh Mills. Each applicant was therefore invited to make
submissions to the planning committee as to why it should be preferred. Both
were told that the council would take into account the community benefits which
were being offered pursuant to draft policy IR4. In response, Tesco and
Sainsbury drew up packages of community benefits. They offered to enter into
agreements with the council under section 106 of the Town and Country Planning
Act 1990, binding themselves to provide the benefits. Sainsbury’s offer
included the construction of a tourist information centre on the site, an art
gallery display facility, a work of art in the car park and a bird-watching
hide overlooking the River Plym. It also offered to contribute £800,000 to the
establishment of a park-and-ride facility in the neighbourhood and up to £1m
for infrastructure works to make a site at Derriford Barton suitable for
industrial use. Tesco’s package was rather more modest: it included financial
contribution to a creche, a wild life habitat and a water sculpture to a design
chosen after public competition in the Plymouth area. It offered to sell the
council a site for a park-and-ride facility, but without undertaking to make
any financial contribution. It did not attempt to match Sainsbury’s offer to
equip an industrial site because it thought that the release of the Vosper site
at the docks was sufficient to compensate for its occupation of industrial land
at Marsh Mills.
Sainsbury,
perhaps sensing that Tesco might have the edge in the competition, urged the
planning officers and the planning committee to depart from the draft
alteration and grant both applications. Mr Roger Dean, the chief assistant city
planning officer, was persuaded. He wrote a long report for the planning
committee advising them on the issues and the relevant considerations to be
taken into account and ended by recommending that both applications be granted.
The committee accepted the advice and on April 23 1992 resolved that, subject
to the conclusion of suitable agreements under section 106, they were minded to
grant both applications.
At the same
meeting on April 23 the planning committee also considered an application by
the appellants, the Plymouth & South Devon Co-operative Society Ltd (‘the
Co-op’). It wanted to build a substantial development including a superstore at
Chaddlewood, a designated district centre 3 or 4 miles from the Marsh Mills
roundabout. The draft first alteration included specific support for this project.
But Mr Dean advised that the Marsh Mills stores might so reduce the demand for
shopping at Chaddlewood that the scheme would be too big. The planning
committee accepted his advice to defer a decision until it had tried to
persuade the Co-op to submit a reduced scheme.
The Co-op was
extremely annoyed by this turn of events. It refused to modify its planning
application, which was eventually approved in
review to quash the resolution approving the grant of permissions to Sainsbury
and Tesco. The main ground of attack was that the planning committee had acted
unlawfully by taking into account immaterial considerations, namely the offers
to provide some or all of the community benefits.
Section 70(2)
of the Town and Country Planning Act 1990 says that, in dealing with an
application for planning permission, the planning authority:
. . . shall
have regard to the provisions of the development plan, so far as material to
the application, and to any other material considerations.
What in this
context is a ‘material consideration’?
The answer appears in the decision of the House of Lords in Newbury
District Council v Secretary of State for the Environment [1981] AC
578, which concerned the vires of a condition attached to a planning
permission. Viscount Dilhorne said such a condition must have satisfied three
tests (at pp 607-8):
(1) It must have a planning purpose; (2) it must
fairly and reasonably relate to the permitted development; and (3) it must not
be Wednesbury unreasonable.
(1) and (2)
are tests of materiality: in this context, considerations are material if they
are planning considerations and fairly and reasonably relate to the
development. The third test does not go to whether considerations are material,
but is an overriding requirement that the authority’s decision (to grant or
refuse permission, impose a condition, require a section 106 agreement) shall
not be Wednesbury unreasonable. Lord Scarman at p618 said that most
cases of Wednesbury unreasonableness would arise out of the authority
having regard to considerations which failed one of the first two tests (or
failing to have regard to considerations which passed them). But there might be
exceptional cases in which a decision was Wednesbury unreasonable
notwithstanding that it was based upon all the material considerations.
Mr Gilbart QC,
who appeared for the Co-op, submitted that, in order to be material, an offer
of community benefits must pass an additional test. The benefits must not only
be planning benefits and fairly and reasonably relate to the development. They
must be necessary in the sense that they overcome what would otherwise have
been a planning objection to the development, so that, without the benefit in
question, planning permission would have been refused.
The judge
rejected this additional test as unsupported by principle or authority. In my
view, he was right. If the benefits concern planning matters, and fairly and
reasonably relate to the development, then the planning authority are entitled
and may be required to take them into account. They are not obliged to exclude
them from consideration while they form a provisional view about the
application and then treat them as material only if the application would
otherwise have been refused. The fact that a benefit overcomes a planning
objection may be a good reason for treating it as material. But none of the
cases relied upon by Mr Gilbart support the proposition that a benefit cannot
be material consideration for any other reason.
In Bradford
City Metropolitan Council v Secretary of State for the Environment
(1986) 53 P&CR 55 the planning authority granted permission for housing
development subject to a condition that the developer widen the road serving
the development. This would have involved the cession of land and expenditure
of money by the developer. On appeal the Secretary of State discharged the
condition as ultra vires. In this court Lloyd LJ agreed. He said,
following Hall & Co Ltd v Shoreham-by-Sea Urban District Council
[1964] 1 WLR 240, that a condition requiring a developer to dedicate its land
as a highway without the compensation to which it would ordinarily be entitled
was Wednesbury unreasonable. The condition was therefore unlawful and,
Lloyd LJ went on obiter to say, would not have been any more lawful if
it had been embodied in an agreement under section 52 of the Town and Country
Planning Act 1971. I need not pause to discuss whether this last dictum
was correct or whether the case would be decided in the same way since the
enactment of section 106 of the Town and Country Planning Act 1990. Whatever
the Bradford case may decide, it contains no trace of a test of
necessity. The condition was held to have been rightly discharged on the ground
that it was Wednesbury unreasonable, possibly because the widening of
the road failed Viscount Dilhorne’s test (2) or possibly because it fell foul
of the residual test (3).
R v Westminster City Council, ex parte Monahan [1990] 1 QB 87
concerned what was treated as a single composite development involving
improvements to the Royal Opera House, Covent Garden, and the construction of
offices nearby. Office development infringed the council’s policy for Covent
Garden, but they granted permission because, without the profit from the office
development, the Royal Opera House would be unable to execute the improvements.
This court decided that this was a material consideration which the planning
authority were entitled to take into account. It applied the criteria of
materiality stated in Newbury. The issue in the case was whether a
sufficient nexus existed between the office development and the Opera House
improvements to entitle the planning authority to say that the desirability of
the latter fairly and reasonably related to the former. This court found such a
nexus in: (1) the financial dependency of the one part of the development on
the other; and (2) their physical proximity. There is nothing to suggest that
the desirability of the Opera House improvements would have ceased to qualify
as a material consideration if there had been no planning objection to the
offices. Its significance for the decision-making process would have
diminished, but that is not the same as saying that it is somehow stripped of
the quality of materiality.
In Safeway
Properties Ltd v Secretary of State for the Environment [1991] 3 PLR
91 Safeway appealed to the Secretary of State against a refusal of planning
permission to build a superstore in Kidbrooke. The inspector found that there
was only one planning objection, namely, the effect which increased traffic
would have upon residents in the surrounding area. Safeway had offered to pay
£1m towards a traffic management scheme which it said would alleviate the
problem. The inspector refused to take this offer into account because he said
that the traffic management scheme had been identified by the council as
desirable before the Safeway application. This court held that he had failed to
have regard to a material consideration. The traffic management proposal was
undoubtedly a planning matter and it fairly and reasonably related to the
development, because it was capable of reducing the additional traffic
disturbance which the development would generate. It did not matter that the
local authority had thought of having it anyway. In this case the consideration
held to be material could have tipped the balance by reducing or eliminating
what the inspector regarded as the planning objection to the proposal. It would
then have satisfied Mr Gilbart’s test of necessity. But the case does not
suggest that benefits cannot be material considerations on any other grounds.
Finally, Mr
Gilbart points to the Department of the Environment circulars, which say that
conditions should not be imposed or section 106 agreements exacted unless they
are necessary in the sense that planning permission would otherwise have been
refused. This is a theme which runs through the whole of the policy guidance on
how planning powers should be exercised. So para 5 of PPG 1 — General Policy
and Principles — says that:
[The planning
system] . . . should operate on the basis that applications for development
should be allowed, having regard to the development plan and all material
considerations, unless the proposed development would cause demonstrable harm
to interests of acknowledged importance.
Dealing with
conditions, PPG 1 says:
46. The
ability of local planning authorities and the Secretary of State to impose
conditions on a planning permission can enable many development proposals to
proceed where it would otherwise be necessary to refuse planning permission . .
. conditions should be used in a way which is clearly seen to be fair,
reasonable and practicable. Conditions should only be imposed where
· necessary
· relevant to planning
· relevant to the development to be permitted
· enforceable
· precise
· reasonable in all other respects
47. In
considering whether a particular condition is necessary, one key test is
whether planning permission would have to be refused if the condition were not
imposed. If not, then such a condition needs special and precise justification.
Similarly,
Circular 16/91, which deals with planning obligations such as section 106
agreements, says:
B7. As with
conditions . . . planning obligations should only be sought where they are
necessary to the granting of permission, relevant to planning and relevant to
the development to be permitted . . .
These
statements of policy embody a general principle that planning control should
restrict the rights of landowners only so far as may be necessary to prevent
harm to community interests. A German or European lawyer would have no
difficulty in recognising this as the principle of proportionality. But the
status of this principle as an instrument of English judicial review is, to say
the least, uncertain: see R v Secretary of State for the Home
Department, ex parte Brind [1991] 1 AC 696. In any case, it would be
bizarre to allow it to be invoked by a trade competitor to destroy a planning
permission granted to a rival who does not complain that his liberty to deal
with his land has been disproportionately restricted. Materiality is an
entirely different matter, because there is a public interest in not allowing
planning permissions to be sold in exchange for benefits which are not planning
considerations or do not relate to the proposed development: see Lloyd LJ in
the Bradford case and Staughton LJ in the Monahan case. The fact
that the principle of necessity is applied as policy by the Secretary of State
does not make it an independent ground for judicial review of a planning
decision. As Sir Donald Nicholls V-C pointed out in Good v Epping
Forest District Council [1992] 3 PLR 103, to say that a condition or the
requirement of a section 106 agreement would have been discharged on appeal by
the Secretary of State, because its imposition did not accord with the policies
I have quoted, is not at all the same thing as saying that the planning
authority would have been acting beyond their statutory powers. This depends
upon the Wednesbury principle and the tests for materiality in Newbury.
I therefore
reject the suggested gloss upon the Newbury tests for materiality and
consider whether they were satisfied by the matters which were proposed to be
included in the section 106 agreements in this case. They all amounted to
considerations of a planning nature and the only question is whether they
fairly and reasonably related to the development. Many of them, such as the
construction of the tourist centre and bird-watching hide, were to be
constructed upon or adjacent to the development itself. They were matters of
benefit to the developer as well as to the community. I do not see how it can
possibly be said that such embellishments did not fairly and reasonably relate
to the development. The only benefits which, in my judgment, give pause for
thought are the two substantial sums offered by Sainsbury as a contribution to
work to be done away from the site. They are the £800,000 contribution to a
park-and-ride facility and the contribution of up to £1m for infrastructure on
a new industrial site at Derrisford Barton.
Mr Peter
Watkins, of Devon County Council highways department, said that the proposed
superstores would have a traffic impact over a wide area of the local highway
network. The beneficial effect of a park-and-ride facility would be to remove
traffic from the main radial commuter/shopper routes, thus reducing conflict with
traffic heading for the proposed superstore. In addition to this general causal
link, Mr Dean added that there were arguments for utilising part of the
Sainsbury site itself for decked car parking to accommodate the park-and-ride,
but Sainsbury preferred the park-and-ride cars to be accommodated elsewhere. If
such accommodation were provided off the site, fewer people would use
Sainsbury’s own car park when they really wanted to park-and-ride rather than
shop at Sainsbury. In my judgment, this was evidence upon which the judge was
entitled to decide that the park-and-ride facility was fairly and reasonably
related to the development.
As for the
infrastructure contribution, Mr Dean said that there was a shortage of serviced
and level sites available for the development or redevelopment of manufacturing
in the city of Plymouth. The council considered that such land should be
available to foster new employment opportunities and policy EM9 of the
structure plan said that the use of employment land for retailing would not
normally be permitted. It was true that, in recent appeals to the Secretary of
State concerning other superstores, little weight appeared to have been
attached to this policy. But, as I have pointed out, the fact that a policy
might not be upheld on appeal does not mean that a planning authority is not
entitled in law to treat it as a material consideration. In this case, the
council regarded the improvement of other land by Sainsbury as a compensating
advantage, equivalent to the release of the Vosper site near the docks in the
Tesco proposal. The offer, it should be noted, was not simply to pay the
council £1m. It was to contribute up to £1m to the actual cost of
infrastructure works undertaken by the council within a period of two years at
a specific site. In my judgment, this benefit was also fairly and reasonably
related to the development.
It follows
that, in my view, the judge was right to hold that the council were entitled to
treat all the matters in the packages of community benefits as material
considerations and this attack on the vires of the decision to grant planning
permission must fail.
Mr Gilbart
also relied upon a completely separate ground, namely that, in coming to their
decision, the council had misunderstood one of their own policies. The draft
first alteration, as I have said, contained specific provision for a new food
store at Chaddlewood, which the alteration designated a district centre. In
para 13.24 of his report, in the section dealing specifically with the Co-op application,
Mr Dean drew these provisions of the draft plan to the attention of the
planning committee. But earlier in the report, in para 7.07, Mr Dean said that
‘the draft First Alteration recognises that it is not realistic to support any
more retail provision in District Centres’. This was not literally true. Mr
Dean should have said that the draft alteration did not support more large
retail provision in existing district centres. It plainly did support
such a development in a proposed new district centre, namely, Chaddlewood. In
my judgment, if one reads the report fairly, the context makes it clear that in
para 7.07 Mr Dean meant existing district centres. The members of the committee
could not possibly have thought that he was contradicting what he said in para
13.24. But Mr Gilbart says that the planning committee might have been misled.
They might have thought that the draft alteration ruled out the possibility of
the development for which the Co-op was applying. For my part, I find it
incredible that anyone who read the section dealing with the Chaddlewood
application itself, and containing Mr Dean’s actual advice, could have formed
this view.
I would
therefore dismiss the appeal.
Appeal
dismissed.
