Stonewater loses legal dispute over development with too much social housing

Housing association Stonewater has lost a High Court battle over a proposed development that, according to Wealden District Council, had too much social housing. The social housing provider now faces a community infrastructure levy bill totalling more than £3m, after judge Justice Thornton ruled against its claim that it should be exempt from that payment. Stonewater was granted planning permission for 169 new homes in Hailsham, East Sussex, last year. The council approved its application on the grounds that 35% of the scheme would be social housing, which would not exempt it from CIL charges. However, Stonewater later bought the plot and outlined its intentions to turn all of the homes into social housing, arguing that this would make it eligible for CIL relief. The council disagreed, saying the fact it stipulated that 35% of the homes should be social housing meant there was nothing to ensure the other 65% of homes would remain as affordable housing. Therefore, Stonewater would only qualify for exemption of 35%. The judge backed the council in a judgment handed down last week, after the case went to trial in September. It came down to the interpretation of a section 106 agreement connected to the development. “The language of the document points to an interpretation that the agreement controls the amount of affordable housing that can come forward by fixing a specific requirement of 59 dwellings or 35% affordable housing,” said Justice Thornton. She added: “If the development proceeds in multiple phases, there must be 35% in each phase and thus, inevitably, as a matter of maths, 35% in aggregate. “Accordingly, a scheme which provides less, or more, units of affordable housing would not comply with the section 106 requirement to provide 59 units and hence would be contrary to its terms and to that extent unlawful, albeit the council would have a discretion to vary the section 106 agreement or enter into a new agreement.” According to the ruling, the council suggested to Stonewater that it should consider agreeing a new section 106 agreement, but the housing association refused. Stonewater (2) Limited v Wealden District Council Planning Court (Thornton J) 15 October 2021