In the High Court case of R (on the application of Bleaklow Industries Limited) v Peak District National Park Authority (1) and Glebe Mines Limited (2);the Claimant Bleaklow Industries Limited, managed to obtain leave to apply for judicial review of the decision by the Peak District National Park Authority (the first Defendant) (PDNPA), to enter into a planning permission and section 106 agreement in relation to mineral extraction. The judicial review was brought on the basis that PDNPA had failed to correctly apply the then current government policy guidance (in respect of Section 106 Planning Obligations).
The Policy Background
For good or bad, most of you will appreciate that Planning obligations are a truly entrenched part of the planning process. They are often treated in conjunction with planning permissions but, can also be stand alone documents.
Planning obligations enable the Local Planning Authority (LPA) to secure restrictions upon the use of land, or seeks to regulate the operation of the development to take place on the land, or to make contributions towards the local infrastructure and facilities. Often very generous developers/owners will make an offer of some sort.
Planning obligations are not restricted to the land which is the subject of the planning permission, unlike planning conditions attached to a planning permission. Although in certain circumstance and if properly drafted, the application of conditions may extend beyond the boundary of the application site.
The most common form of planning obligation is a contractual agreement made between the planning authority and the developer under section 106 of the Town and Country Planning Act 1990 (as amended). Perhaps to most of you, such agreements are commonly referred to as "section 106 agreements".
Central Government issued its latest policy guidance on the use of section 106 agreements and this can be found in the form of Planning Circular 05/2005, replacing its predecessor Circular 1/97). The aim of this guidance inter alia was to emphasize the point that Planning permissions cannot be bought, to instil public confidence in the planning process.
In terms of this case, the relevant Circular was 1/97, which sets out the government guidance and effectively the legal position (I make reference to the legal position (albeit that Circular 1/97 is Government Policy, because policy has been subsequently amended by case law).
This Circular set out the 6 test criteria under which a section 106 agreement should only be entered into. The agreement had to be;
- Relevant to planning
- Necessary
- Directly related to the proposed development
- Fairly and reasonably related in scale and kind to the proposed development
- Reasonable in all other respects, and
- Enforceable
It is not clear to what extent LPAs apply this criteria since it is not legally on LPAs, but is a "material consideration" when determining a planning applications.
Facts of the case
In 1952 the PDNP granted planning permission to extract minerals which was granted. The planning permission allowed mineral extraction to continue for a period of 40 years.
The Claimant, Bleaklow Industries Limited owned most of the Claimant's land and the second defendant, Glebe Mines Limited (Glebe), owned the vein mineral rights in a substantial part of the Claimant's land.
Glebe applied to PDNPA for planning permission to extract vein minerals from another site within the until 31 July 2008. In return for the new planning permission, Glebe indicated that it would enter into a section 106 agreement to cease working the Claimant's land. Glebe also offered to sell its rights to extract vein minerals from the Claimant's land to PDNPA for £1. The report upon which the planning committee relied gave the impression that these obligations would effectively prevent further mineral extraction in a substantial part of the Claimant's land.
The planning Committee recognised that it would be contrary to the development plan to grant planning permission for another site on the , as alternative national sources of fluorspar were available. Because of this, the application had to be referred to the First Secretary of State under the "call in" procedure.
The Planning committee recommended that the application be approved, subject to the completion of a section 106 agreement. The key factor for the recommendation was the perceived benefit of Glebe relinquishing its rights in respect of the Claimant's land. The First Secretary of State did not call in the application.
The alternative site to which planning permission was granted by PDNPA, the decision notice stated that there was no national need for the development to take place as there were alternative sources of fluorspar available and noted that objections had been raised because of the visual impact of the development. However, the decision notice also stated that the opportunity to safeguard a substantial part of the Claimant's land from a further 40 years of mineral extraction carried significant weight and was in the public interest.
The Claimant applied for judicial review of PDNPA's decision to grant planning permission for the alternative site on the and also to enter into the section 106 agreement. Permission for judicial review was granted on three grounds:
- Consideration of Circular 1/97.
- Planning implications of the Mines (Working Facilities and Support) Act 1966.
- Sustainability.
HELD
The High Court upheld Claimant's claim and declared that the decisions to grant planning permission for the alternative site and enter into the section 106 agreement were both unlawful.
The High Court considered each of the three grounds which the Claimant had raised.
Consideration of Planning Circular 1/97
As stated above Planning Circular 1/97 was not legally binding on the planning committee, it was however, a material consideration when deciding whether to enter into a section 106 agreement. The Claimant claimed that because the report to the planning committee did not expressly refer to Circular 1/97, the planning committee had failed to have regard to the tests set out above.
The High Court found that the lack of an express mention of Planning Circular 1/97 in the report to the planning committee was not relevant. The issue was whether the relevant policy had been considered by the planning committee in making its decision.
PDNPA argued that members of the planning committee were aware of Circular 1/97, as a result of an external training course. A copy of the training course handout was provided to the Court. The handout advised that a proposed section 106 agreement must satisfy one of the tests listed in Circular 1/97. The handout did not make it clear that the tests were cumulative. Of the 19 members of the planning committee who considered the application, 17 had been on the training course.
The High Court accepted that the planning committee knew that there was Government policy guidance on the use of section 106 agreements in Planning Circular 1/97. The judge also accepted that the guidance was a relevant factor in considering the application, and believed that members of the planning committee were following that guidance when deciding that planning permission should be granted subject to a section 106 agreement.
However, the High Court held that because "it appeared" (test of perception), that the planning committee was not aware that the tests in Circular 1/97 were cumulative, the planning committee had been "significantly mislead" as to the policy guidance in Circular 1/97. As a result the planning committee had misapplied Government policy. This was especially important given that the section 106 agreement was the key factor in deciding whether to grant planning permission for the alternative site.
Although the Judge found under the Claimant's favour in respect of the second ground, Mines (Working Facilities and Support) Act 1966, it falls outside the scope of this update.
Sustainability
The third ground upon which the Claimant was granted permission for judicial review was sustainability. This ground was made out on the basis that the planning committee had virtually no information to allow them to assess properly the benefits of the section 106 agreement.
The planning committee viewed the prevention of further mineral working of a substantial part of the Claimant's land as a significant benefit. However, the report upon which the planning committee relied did not address whether there were any workable vein mineral reserves in that area of land. In fact, both PDNPA and Glebe held the view that there were no workable vein mineral reserves in the land which was subject to the section 106 agreement.
If PDNPA and Glebe were correct in this assessment, it was difficult to see the benefit being conferred by the section 106 agreement.
Conclusion
The outcome of this case does not change the law, but it is a useful reminder of the importance of following Government policy guidance in relation to section 106 agreements. Although an officer's report to the planning authority does not need to expressly mention policy guidance, the planning authority must be able to demonstrate that it understood the policy guidance and applied it correctly.
It is also important that a planning committee is given sufficient information to make an informed decision on whether the obligations in a section 106 agreement achieve the desired aim. The key may be to ensure members sitting on the planning committee fully understand the policy background, or perhaps something like this should be set as a standing item on committee reports as a constant reminder to members on the planning committee.
Remember, it is not whether you have or have not applied something (policy, in this case), it is the perception that you have.
For more information please contact Pritpal Singh Swarn
