• Issue 40

  • Sep 2018

The Source

Clarifying The Proper Use Of Planning Conditions And s. 106 Planning ObligationsImage result for landmark chambers

Various aspects of the proper use of planning conditions and s. 106 planning obligations have been considered by the courts during the past twelve months. In particular, the courts have analysed (i) whether a local planning authority may lawfully impose a planning condition that prevents development from coming forward until CIL-funded infrastructure has been provided, even if that is not within the power of the applicant; and (ii) the circumstances in which community benefits that are secured by a planning condition or s. 106 planning obligation will be a material consideration in the determination of an application for planning permission.

Background

Community infrastructure levy (“CIL”) is intended to provide infrastructure to support the development of an area, in contrast to planning obligations entered into under s. 106 of the Town and Country Planning Act 1990, which are intended to make individual planning applications acceptable in planning terms. In order to ensure that s. 106 planning obligations and CIL operate in a complementary way, reg. 123 of the CIL Regulations 2010 (“Reg. 123”) provides that a s. 106 planning obligation cannot constitute a reason for granting planning permission to the extent that it provides for the funding or provision of infrastructure that is included in a local planning authority’s CIL list. Additionally, under reg. 122 of the CIL Regulations 2010 (“Reg. 122”) a s. 106 planning obligation can only constitute a reason for granting planning permission if it is (a) necessary to make the development acceptable in planning terms; (b) directly related to the development; and (c) fairly and reasonably related in scale and kind to the development.

The National Planning Policy Framework (“NPPF”) provides that planning conditions should only be imposed where they are necessary, relevant to planning and to the development to be permitted, enforceable, precise and reasonable in all other respects.

Planning conditions and CIL-funded infrastructure

The Court of Appeal handed down judgment in R (on the application of Oates) v Wealden District Council on 8 June 2018. The claimant challenged a grant of outline planning permission for a development of up to 390 houses, on the ground that the advice given to the council’s planning committee by its planning officer had materially misled committee members on the effect of Reg. 123 and on the acceptability of the likely impact on local junctions of traffic generated by the development.

The highway authority had initially objected to the scheme, taking the view that improvements to mitigate the impact of the development on the highway network were required prior to the commencement of development and that although the applicant for planning permission would pay the appropriate CIL contribution towards those improvements, that would not ensure their delivery within the relevant timescale (or at all).

The applicant argued that the highway authority’s position was unsound. Infrastructure improvements that were included in a CIL list could only be provided through the payment of a CIL contribution. Delivery of such improvements and the timing of the same were both matters beyond the developer’s control. The developer was, therefore, doing everything that could legitimately be asked of it by paying the CIL contribution.

The highway authority accepted that argument and withdrew its original recommendation for refusal. The council’s planning officer subsequently advised that there were no reasons in transport terms to justify a refusal of planning permission. Outline planning permission was granted without a planning condition preventing occupation of the development prior to delivery of the CIL-funded infrastructure.

The claimant argued that where an infrastructure project was to be funded through CIL, harm that would arise before that infrastructure was provided could be a reason for refusing planning permission, or for imposing a planning condition preventing the development coming forward until the necessary infrastructure improvements had been carried out. Both the highway authority and the council had wrongly thought that, as a matter of law, harm that was eventually going to be mitigated by CIL-funded infrastructure could not found an objection.

The Court of Appeal accepted that it was open to a local planning authority to refuse planning permission for development that was unacceptable in the absence of CIL-funded infrastructure, holding that Regs. 122 and 123 did not preclude planning permission being granted subject to a lawful condition specifically preventing the occupation of the development prior to the provision of the necessary infrastructure, even if that was not within the power of the applicant.

On the facts, however, the planning officer had not advised the planning committee that the council could not lawfully refuse planning permission if the likely effects of traffic from the development were unacceptable. Rather, she had exercised her planning judgement and reached a conclusion that a refusal of planning permission on highway grounds could not be justified because the cumulative effect of traffic (including from the scheme) was not, in fact, going to exceed the impact anticipated in the development plan before the CIL-funded junction improvements were in place. Unlike the highway authority, she had grappled with the likely relative timing of development and highway improvements and had reached what was in the Court of Appeal’s view a “perfectly rational and understandable conclusion”. The Court of Appeal dismissed the claim.

Community benefits as a material consideration in planning decisions

In what circumstances will community benefits that are secured by planning condition or s. 106 planning obligation be a material consideration in the determination of an application for planning permission? That is the question under debate in R (on the application of Wright) v Resilient Energy Severndale Ltd, in which judgment was handed down by the Court of Appeal on 14 December 2017 and which is now on appeal to the Supreme Court.

Wright is a challenge to a grant of full planning permission for a single, community-scale 500kW wind turbine. Planning permission was granted subject to a planning condition that required the development to be undertaken by a community benefit society. A community benefit fund donation of a proportion of the turnover derived from the turbine was proposed and was taken into account as a material consideration by the local planning authority in granting planning permission.

The Court of Appeal held that this was unlawful. Neither the source of the funds nor the fact that a matter was regarded as beneficial to the public made a matter a material consideration for planning purposes. The question was not whether the proffered benefits were desirable: it was whether they were material in planning terms. Irrespective of how well-intentioned the proposed donor and how publicly desirable the donation might be, the donation would not be material for planning purposes unless it satisfied the Newbury criteria: it must have a planning purpose and it must fairly and reasonably relate to the permitted development. A planning purpose was one that related to the character or use of the land. On the facts in Wright, use of the community benefit fund was not restricted to use for a planning purpose.

Furthermore, whilst both the NPPF and the government’s Planning Practice Guidance encouraged the use of renewable energy and particularly community-led initiatives in that regard, neither encouraged unrestricted gifts of money to the community and in any event, planning policy could not convert something immaterial into a material consideration for planning purposes.

The Court of Appeal held that Dove J had therefore been entitled to conclude that the community donation was “an untargeted contribution of off-site community benefits” that was not designed to address a planning purpose and that there was “no real connection” between the proposed development and the gift of monies to be used for any purpose from which it was considered that the community would derive benefit.

Conclusions

The key lessons for developers that emerge from Oates and Wright are the following. First, if the local planning authority concludes that proposed development will have an unacceptable impact until CIL-funded infrastructure is delivered, it is open to the local planning authority to refuse to grant planning permission or to do so subject to a planning condition that prevents the proposed development from coming forward ahead of that infrastructure. That is so even if delivery of the infrastructure (and / or the timing of the same) is beyond the control of the developer. The developer might therefore wish to focus on satisfying the local planning authority that the proposed development will not have an unacceptable impact prior to delivery of the CIL-funded infrastructure.

Secondly – at least pending the Supreme Court’s decision in Wright in due course – if a community benefit package secured by a planning condition or s. 106 planning obligation is to be effective (i.e. if it is to weigh in the planning balance in favour of granting planning permission), it must have a planning purpose. Where the benefit is a financial donation, the use of the monies must therefore be restricted to use for such a purpose and there must be a real connection to the proposed development (such that, for example, there is a clear justification for the amount of the donation). A community benefit package that is in essence simply an inducement to make the proposed development more attractive to local residents and / or the local planning authority will not be a material consideration.

Heather Sargent
Landmark Chambers
hsargent@landmarkchambers.co.uk