Challenges to Development Plans new plans, new problems; The Planning and Compensation Bill

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1 Challenges to Development Plans new plans, new problems; The Planning and Compensation Bill By Alice Robinson 1 and Joanne Clement 2 Legal challenges the present law Challenges to a development plan must be brought under Part XII of the Town and Country Planning Act 1990 ( the 1990 Act ). The starting point is s.284(1)(a) which provides that: 1 Barrister, Landmark Chambers. 2 Barrister, Judicial Assistant to the Law Lords Except as may be provided by this Part, the validity of (a) a structure plan, local plan, minerals local plan, waste local plan or unitary development plan or any alteration or replacement of any such plan, whether before or after the plan, alteration or replacement has been approved or adopted... shall not be questioned in any legal proceedings whatsoever. The provisions which govern the method by which the validity of development plans may be questioned are contained in s.287. In light of s.284(1)(a), this is an exclusive procedure. A challenge under s.287 is the only way in which the validity of such plans may be challenged. Section 287(1) provides that: (1) If any person aggrieved by a unitary development plan or a local plan...or by any alteration or replacement of any such plan or structure plan, desires to question the validity of the plan...on the ground (a) that it is not within the powers conferred by Part II, or (b) that any requirement of that Part or of any regulations made under it has not been complied with in relation to the approval or adoption of the plan, or, as the case may be, its alteration or replacement, he may make an application to the High Court under this section. Section 287(4) provides that an application under this section must be made within six weeks from the relevant date. Section 287(5) defines the relevant date as being...the date of the publication of the first notice of the approval or adoption of the plan, alteration or replacement required by regulations under s.26 or, as the case may be, s.53. As a result of s.284(1)(a), the courts have held that no legal challenge may be brought in respect of the plan-making process until the commencement of the six week period i.e. until the plan has been adopted. The case of R. v Test Valley Borough Council Ex p. Peel Estates [1990] 3 PLR 14, QBD establishes that the above statutory provisions preclude any challenge until the six week period commences. Kennedy J. rejected the argument that, until the plan had been approved or adopted, there was no plan at all. He stated that the prohibition in s.284(1)(a) clearly applies before the plan had been approved or adopted. He also rejected a submission that the challenge was not to the validity of the local plan but to the

2 Challenges to Development Plans 1385 decision of the LPA to proceed in the light of an inadequate inspector s report. The LPA s decision was to publish modifications following the Inspector s report which was a step towards validation of the plan. The applicant was attempting to question the validity of the local plan before the local plan had been adopted. At p.16d, Kennedy J. stated: I agree with the applicants that it is, to say the least, unfortunate if the effect of section [284] is to require a defective procedure to go on to a conclusion before it is possible to mount a legal challenge pursuant to section [287], but I cannot alter the plain words of a statute simply because in certain circumstances those words would seem likely to produce an unfortunate result. The case of R. v Cornwall County Council Ex p. Huntington [1994] 1 All E.R. 694, CA supports this interpretation. That concerned challenges to a definitive map modification order under the Wildlife and Countryside Act The order had been made but not yet confirmed. Paragraph 12 of Sch.15 contains provisions which have the same combined effect as s.284(1)(a) and s.287. Paragraphs 12(1) and (3) of Sch.15 state: (1) If any person is aggrieved by an order which has taken effect and desires to question its validity... he may within 42 days from the date of publication... make an application to the High Court under this paragraph. (3) Except as provided by this paragraph, the validity of an order shall not be questioned in any legal proceedings whatsoever. Paragraph 13(2) of Schedule 15 defines order to mean an order to which the provisions of this Schedule apply so that para.12(3) clearly applies to an order whether confirmed or not. The High Court and Court of Appeal held that the effect of such provisions is that questions of invalidity may be raised on the specified grounds in the prescribed time and in the prescribed manner but otherwise the jurisdiction of the court is excluded in the interest of certainty. Simon Brown L.J. quoted with approval from McCullough J. below: [it is] clear that what prevented the decisions under challenge from being questioned in any legal proceedings except those brought under the provisions enabling an application to be made to this court within six weeks was the existence of the statutory scheme as a whole. It is the intention of Parliament in all these provisions that the High Court should only become involved when all the administrative steps have been completed. It is thus clear that the current position is that any proceedings brought in connection with steps taken prior to any such orders being confirmed or adopted are proceedings which question the validity of the relevant plan or order, and as such, can only be brought within the statutory window. The exclusionary provisions do not apply to the three areas identified by Simon Brown L.J. in Ex p. Huntingdon at p.701d as being outside the preclusive clause altogether: (a) A failure to exercise the jurisdiction at all; (b) Where the reasoning underpinning the decision was otherwise in the applicant s favour; and (c) Where what was challenged was some antecedent step quite separate from and distinct from any eventual decision reviewable under the statute e.g. a resolution to prepare a plan, see R. v Wiltshire County Council Ex p. Nettlecome and Pelham [1998] J.P.L. 707, QBD. Further, there are signs that the courts are prepared to accept the argument that an early challenge has only to do with the applicant s procedural rights and nothing to do with the ultimate validity of the plan. In the case of R. v Hinckley & Bosworth BC Ex p. Fitchett & Bloor (1997) 74 P. & C.R. 52, H.H.

3 1386 Challenges to Development Plans Judge Rich Q.C. held that the Council s refusal to consider the applicant s objections to its local plan when its objections had been delivered four minutes late was amenable to judicial review and did not fall within the ouster provision. He concluded that the applicants were not concerned with the ultimate validity of the adopted plan or the validity of the local plan as it is put on deposit. They were concerned with their status at an inquiry which was to be undertaken into that deposit local plan. He stated: the challenge is not a challenge therefore to the validity of the local plan, it is a challenge to the procedure adopted in respect of its consideration. It is... properly to be described as an antecedent step quite separate and distinct from the eventual decision even though it might be taken, if uncorrected, to vitiate that eventual decision. 3 It is difficult to reconcile the concluding words of this passage with the reasoning in Ex p. Huntington set out above. The general approach to the preclusive provisions may be criticised as the opportunity to challenge any decision of the local authority only arises after the plan has been confirmed, risking the possibility that time and money devoted to an intervening local inquiry have been wasted. On the other hand, if the policy is continued, it ensures that the local inquiry will not be delayed by applications for judicial review at an early stage. If a challenge is successful the court may, by interim order wholly or in part suspend the operation of, or wholly or in part quash the plan or, as the case may be, the alteration or replacement either generally or in so far as it affects any property of the applicant, see s.287(2) of the 1990 Act. The case of South Northamptonshire District Council v Charles Church Developments Ltd and SSETR [2000] PLCR 46, QBD examined the stage in the plan process to which an LPA is obliged to revert if part of the plan is quashed. Hidden J. stated that the LPA must start the whole planning process afresh for the quashed part of the plan, see p.53c. At the bottom of p.53 he said:...an order quashing the Plan (or part of it) requires the Council to recommence the plan process or to alter the remaining parts of the development plan to accommodate replacement policies for the part quashed. The Council does not have the option of proceeding to some later stage in the plan process... The judge went on to justify this conclusion on the basis that there are a wide range of defects which may occur in the plan process which make it impossible to state that the LPA must revert to a single point in the process, other than its inception. The problems caused by the restricted nature of the court s powers were highlighted by Buxton L.J. in First Corporate Shipping Ltd v North Somerset Council [2002] PLCR 7, CA. He stated in para.35: To grant a remedy in terms of quashing may be a logical remedy attached to a complaint made where the investigative process has come to an end and the error complained of is irrationality or unfairness of a public law nature in the actual proposals adopted, that is to say an error in the rational process of thinking of the local authority; but here the irrationality is said to be not in the result that the local authority produced but in its failure to take a particular procedural step. It is very much more difficult to see how quashing can be a justified response to such an error. It is even more difficult to see how a justified response to such an error can be to quash a part of the plan in respect of which no actual complaint was made by the applicant. If I thought...that there 3 See also Terry Adams v Bolton MBC (1996) 73 P. & C.R. 446, QBD where the court considered that a challenge under s.287 to a UDP could not be brought on the grounds of a breach of the rules of natural justice at the UDP inquiry. However, it is not clear to what extent this is part of the ratio of the case; it is a brief remark and there is no discussion in the judgment of any of the relevant authorities.

4 Challenges to Development Plans 1387 had been public law error in this case in terms of not requiring a public inquiry, by far the most obvious remedy for that error in public law terms would either be a declaration on the part of this court or a remission of the matter to the local authority. Neither of these remedies is available under s.287. That means (and I say this only as a matter of comment) that if a court found itself in a position where there had been such an error it would have to consider very carefully in terms of its discretion whether, nonetheless, it was appropriate to articulate that error and give relief in terms of quashing part of the plan. I mention this point because it was a matter of some concern, certainly to me and I think also to my Lords, as to how this jurisdiction could properly be administered. Legal challenges under the new regime The framework of the Planning and Compulsory Purchase Bill is to (1) amend ss.284 and 287 of the 1990 Act so that they do not apply at all to plans, only to simplified planning zone schemes and orders relating to highways and statutory undertakers (the amendments and repeals are set out in Schs 3 and 6), and (2) provide a new section dealing exclusively with challenges to the various new forms of plans. The new proposals governing the validity of strategies, plans and documents are found in cl.78 of the Bill. This is located in Pt 8, which applies to both England and Wales. Clause 78(1) provides that: This section applies to (a) a revision of the regional spatial strategy; (b) the Wales Spatial Plan; (c) a local development document; (d) a local development plan; (e) a revision of a document mentioned in paragraph (b), (c) or (d); (f) the Mayor of London s spatial development strategy; (g) an alteration or replacement of the spatial development strategy and anything falling within paragraphs (a) to (g) is referred to in this section as a relevant document Clause 78(2) provides that: A relevant document must not be questioned in any legal proceedings except in so far as is provided by the following provisions of this section. Clause 78(3) sets out the grounds of challenge which are similar to s.287(1) of the 1990 Act and cll.78(4) and (11) provide the same six week period for challenge from the date of approval or adoption. What are the differences between the existing and proposed regimes for challenging a plan? In our view there are two main changes: (1) the words whether before or after the plan, alteration or replacement has been approved or adopted in s.284(1)(a) have not been included in cl.78(2), and (2) although the grounds of challenge are the same, because an Inspector s recommendations are binding the nature of the challenges brought are likely to be different. (1) ambit of the ouster It is not clear whether the omission of the words whether before or after the plan, alteration or replacement has been approved or adopted was intended to bring about a change in approach

5 1388 Challenges to Development Plans from that adopted under s.284(1)(a). Thus it is not clear whether cl.78(2) is intended to exclude all other challenges to adopted documents only, or whether the exclusion is as wide as it was under s.284(1)(a) above applying to any challenge to the validity of plans as soon as a draft of the plan is available. Examination of the provisions in the Bill dealing with each of the plans suggests that in most cases cl.78(2) only excludes challenges to approved or adopted plans. Clause 1(4) envisages that when the Bill becomes law existing RPG s will become the Regional Spatial Strategy ( RSS ) for each region. Revisions are to be prepared in accordance with cll.5 to 9. These refer to preparation and examination of a draft revision of the RSS until the time when the final document is published pursuant to cl.8(6) when the word draft is dropped. The six week period for challenge begins on the date the revision is published. Thus if a revision to the regional spatial strategy in cl.78(1)(a) is construed consistently with the provisions for its preparation and publication it means only the final published version. Thus the right to challenge a revision of an RSS in cl.78 does not apply to a draft revision of an RSS nor does the prohibition on challenges by other means apply. On the other hand references to the Wales Spatial Plan in cl.54 do not differentiate between the plan in its preparation and publication as a draft and the final approval of it by the National Assembly for Wales. Therefore the words the Wales Spatial Plan in cl.78(1)(b) could mean a draft or the approved plan. Yet another approach has been taken in the drafting with regard to a local development document (in England) and a local development plan (in Wales). No distinction is made in the description of the plan depending on whether it is a draft or the adopted version. However, cl.16(7) states that A document is a local development document only in so far as it or any part of it (a) is adopted by resolution of the local planning authority as a local development document (or approved by the Secretary of State). Clause 56(8) contains a similar provision relating to a local development plan. Does this mean that the words local development document and local development plan in cl.78(1)(c) and (d) only refer to an adopted or approved plan? If so the right to challenge in clause 78 and the prohibition on challenging by other means do not apply to draft plans. The Bill applies the main provisions relating to the Wales Spatial Plan, local development documents and local development plans to revisions of them, see cll.54, 25(3) and 64(3) of the Bill. Accordingly the position of revisions in cl.78 appears to be same as that of the original plan. The Greater London Authority Act 1999 contains the provisions relating to publication of the Mayor s spatial development strategy. These refer in ss.335(1) and (2) to preparation of a draft of the proposed spatial development strategy and then in s.337 to publication of the spatial development strategy (following consideration of representations and the report of an examination of it). Thus the position appears to be the same as with an RSS, cl.78 only applies to the final published version and does not prohibit challenges by other means to earlier draft versions. These changes do not appear to have been mentioned in any of the documents published by government prior to the Bill or discussed during the Bill s passage so far through Parliament. However, exclusionary provisions similar to those in the 1990 Act explicitly refer to orders regardless of whether they have been confirmed or adopted, for example s.25 of the Acquisition of Land Act 1981 in relation to compulsory purchase orders and paras 12 and 13 of Sch.15 to the Wildlife and Countryside Act 1981 in relation to definitive map modification orders. The omission of such words in the Bill appears to be

6 Challenges to Development Plans 1389 deliberate and opens the way for judicial review actions to be brought to challenge any decision taken by the relevant public body prior to the adoption or final publication of the revised document, except possibly the Wales Spatial Plan. (2) Grounds of challenge within clause 78 Clearly, if it is possible to challenge steps leading up to the adoption or finalisation of a plan, then a challenge can be brought under ordinary judicial review principles. If a challenge is brought under cl.78, the grounds of challenge are set out at cl.78(3): (a) The document is not within the appropriate power; (b) A procedural requirement has not been complied with. The appropriate power is defined in cl.78(9) and refers to the relevant Parts or sections of the Bill which deal with the particular document in question. A procedural requirement is defined in cl.78(10) as being:... a requirement under the appropriate power or contained in regulations or an order made under that power which relates to the adoption or approval of a relevant document. The necessary procedural requirements will be imposed by means of secondary legislation and until drafts are provided by government, it is not possible to guess the procedural provisions. Presumably, they will be similar to the current provisions. Other potential grounds of challenge may become apparent once the draft regulations are available. Under s.287, the courts have treated the first head of review as equating with the grounds for an application for judicial review, see Warren v Uttlesford DC [1997] J.P.L. 1130, CA. There is nothing in the Bill to suggest that this approach will be altered. There is an additional requirement with regards to this second head of review under s.287(2)(b) of the 1990 Act that the interests of the applicant have been substantially prejudiced. This distinction between the first and second heads is retained by the Bill. Clause 78(6)(b) states that the High Court may quash the relevant document if it is satisfied that it is to any extent outside the appropriate power, whereas it may only quash a relevant document for a failure to comply with a procedural requirement if the interests of the applicant have been substantially prejudiced by the failure to comply. A large number of challenges to development plans under the present regime are to an LPA s reasons for rejecting a recommendation in an Inspector s report and to a refusal to hold an inquiry into modifications made to the plan, see for example Warren v Uttlesford (a challenge to the LPA s decision not to hold a further public inquiry into proposed modifications). The scope for such challenges will be severely reduced under the Bill because LPAs lose their wide-ranging powers to override the Inspector s recommendations and to propose modifications to a local development document (in England) and a local development plan (in Wales), see cll.22 and 61. The Secretary of State s powers are not restricted in this way so far as an RSS is concerned (nor are the GLA s in relation to the spatial development strategy). It remains to be seen to what extent it is relevant to the Wales Spatial Plan as the Bill does not set out any procedural steps or provide for its examination by any third party. Thus in respect of local development documents and local development plans it will no longer be possible to challenge the adequacy of the reasons for deciding not to accept an Inspector s recommendation or the

7 1390 Challenges to Development Plans LPA s decision not to hold a further inquiry even on the grounds that there has been a material change in circumstances after the Inspector s report. It is our view that the binding nature of the Inspector s recommendations gives rise to two potential areas of challenge: (i) a post adoption challenge within the procedure set out in cl.78 on the grounds that the LPA failed to adopt the Inspector s recommendations as it had misunderstood the recommendations or failed to understand the methodology adopted by the Inspector, (ii) a pre or post adoption challenge (depending on the interpretation of cl.78) on the basis that the Inspector made an error of law in reaching his recommendations. The LPA misunderstands the Inspector s recommendations The first area of challenge will assume that the LPA purport to adopt the Inspector s modifications, but has failed to do so because it misunderstood them. This potential line of challenge will build upon the recent cases of Morris Holmes Ltd v South Ribble Borough Council [2001] J.P.L. 614, QBD and University of Leeds v Leeds City Council [2002] EWHC 738 (Admin). In Morris Holmes, an application to quash a local plan was made on the ground that, in arriving at a figure for the necessary housing allocations in the plan, the Council purported to follow the methodology used by the Inspector but misapplied it. The court agreed, holding that the Council failed to understand the methodology which the Inspector had adopted and its purpose. In University of Leeds v Leeds City Council the Inspector recommended deletion of a retail allocation and found it would cause harm to a policy which sought to protect open land, N11. The LPA accepted the recommendation but in response, as well as deleting the retail allocation, increased the geographical area covered by policy N11 to cover the retail site. The High Court held that the LPA had adopted a mistaken and unreasonable interpretation of the Inspectors report and quashed the relevant part of the plan. A further issue which arose was whether the Court is entitled to interpret the Inspector s recommendations itself to determine whether the LPA has complied with them, or whether the court can only interfere if the interpretation placed on the recommendations by the LPA is unreasonable in the sense described in R. v Derbyshire CC Ex p. Woods [1997] J.P.L. 958, CA and R. v City and County of Swansea Ex p. Granada Hospitality Ltd [1999] P.L.C.R. 273, QBD at pp , cases which concern the interpretation of planning policy. In the latter case Richards J. considered that the role of the court was to say whether the decision maker had attributed to the policy a meaning which he could not reasonably have attributed to it, or, in forming his conclusion, had taken into account irrelevant matters or disregarded matters that were relevant. The court did not resolve the issue in University of Leeds. At para.26, Richards J. stated: In the event it is unnecessary for me to resolve that issue, since I am satisfied, for the reasons given, that the Council s interpretation was not only wrong but also unreasonable. It is difficult to judge what the position will be under the new Bill. The question whether a particular development falls within a policy often involves a considerable amount of planning judgment and the courts should not interfere unless the LPA have acted unreasonably in the Wednesbury sense. However,

8 Challenges to Development Plans 1391 the question whether an LPA has in fact adopted an Inspector s recommendations is an entirely separate question. It does not depend on planning expertise but on the interpretation of the words used by the Inspector. In these cases the LPAs purported to accept the recommendations of the Inspector, and the challenges were brought on the basis that they had intended to accept them, but had actually failed to do so. If this situation occurs under the new regime, the adoption of the local development plan document or a local development plan will be outside the appropriate power contained in Pt 2 or Pt 6 of the Bill, as the LPA will have adopted the plan otherwise than in accordance with the recommendations of the person appointed to carry out the independent examination. The Inspector makes an error of law There are no express provisions which allow an objector or the LPA to challenge the Inspector s recommendations. On the assumption that a challenge can only be made within cl.78, the only option open to the LPA is to continue with the development plan process and adopt the plan in accordance with cll.22 and 61. The LPA does not even have the vires to withdraw the plan on its own initiative after it has been submitted for independent examination, see cll.21(2) and 60(2). This would create an unsatisfactory situation. The LPA and objectors may feel that the Inspector has made an error of law. The first problem is that it is not clear who the defendant should be. It is the LPA who adopts the development plan, but the reality is that they do not have the final say over its content. The final decision lies with the Inspector who conducts the independent examination who is appointed by the Secretary of State, see cl.19(4) (or the National Assembly for Wales, see cl.58(4)). It is not clear who is responsible for the Inspector s decision. Should it be the LPA who adopt the plan? Or the Secretary of State (Welsh Assembly) who appoints the Inspector? Under the current regime, Inspectors are appointed by the Secretary of State, but they report to the local planning authority. Whether the proper defendant is the Secretary of State or the LPA it is not clear how the LPA could challenge a plan post-adoption, as the LPA would be the body that had taken the steps to adopt it even though it can neither challenge the Inspector s report or refuse to adopt the plan in accordance with his recommendations. It is difficult to see how an LPA can be a person aggrieved within the meaning of cl.78(2) if it is the person responsible for the adoption. In this sense, an LPA will not have had an adverse decision made against it, as it is the person carrying out the adoption. In exceptional cases, an LPA may indirectly challenge its own actions, see R. v Bassetlaw District Council Ex p. Oxby [1998] P.C.L.R. 283, CA. The leader of the Council, Mr Oxby, brought proceedings against the Council by which he sought to challenge decisions which granted planning consent for residential development on the grounds of bias or apparent bias on the part of some of the councillors on the planning committee. The Court of Appeal held that Mr Oxby had sufficient interest in the matter so as to have locus standi to bring the judicial review proceedings. It was at the second stage, when exercising the discretion whether or not to grant the remedy, that the court must take into account that in substance, though not in form, it is the council itself that is seeking to have decisions of its own declared void. If a councillor can challenge the grant of planning consents on the grounds that the grant of permission was invalid, it would seem to be equally possible that a councillor can challenge the validity of a development plan if he/she (or in reality the LPA) considers that the development plan itself is invalid.

9 1392 Challenges to Development Plans In R. v Restormel Borough Council Ex p. Corbett [2001] J.P.L. 445, QBD the court emphasised the exceptional nature of this type of challenge and said that there must be strong public policy reasons against allowing an authority to succeed in the absence of exceptional grounds, see para.68. Yet an authority seeking to quash its own plan is in substance challenging the Inspector s recommendation not going back on one of its own decisions. If the Inspector s error is prejudicial to the LPA s interests and there are no other potential challengers it seems quite wrong that the LPA should be unable to challenge the illegality. Nor would there by any other means within the LPA s control to achieve the same result in contrast to the Bassetlaw and Restormel cases where the option of revocation or modification of the planning permission existed. Not all Inspectors get it right and some get it very wrong, for an exceptional case see Peel Investments (North) Ltd v Rossendale Borough Council (1996) 73 P. & C.R. 191, QBD where it was held that an Inspector s consideration of an objection was so defective as to be no consideration at all. This would appear to be an expensive and time consuming method of challenging the plan. If this is the only way to diverge from the Inspector s recommendations, then the government s objective of speeding up the development plan process may not be met. Under the current system, the LPA would simply be able to refuse to accept the Inspector s recommendations if it considered that he had made an error of law. By contrast, the new Bill appears to insist that the plan be quashed, the LPA go back to the beginning of the process, and hope that the next time round they will be allocated an Inspector who does not make mistakes. It is difficult to believe that this is the intention of government. It is possible to conceive of some back door methods of avoiding this difficulty although none of them are very satisfactory. The Secretary of State has the power to direct that the document be withdrawn after it has been submitted for independent examination, see cll.21(2)(b) and 60(2)(b). It is possible that representations could be made to the Secretary of State to the effect that the Inspector has made an error of law, and inviting him to make a direction withdrawing the document. This power only exists with regards to the document as a whole. This would result in the LPA being forced to go back to the beginning of the plan preparation process, with the prospect of going through it all again if the next Inspector also makes a mistake. Alternatively, the Secretary of State (or Welsh Assembly) may intervene under cll.20(1) and 59(1), which provide that if he thinks that a local development document or local development plan is unsatisfactory, he may at any time before the document is adopted direct the LPA to modify the document in accordance with the direction. This power at least allows a direction to be made with regards to part of the plan but the LPA/objector would have to convince the Secretary of State or Welsh Assembly of the error. If it is possible to bring judicial review proceedings against decisions taken by public bodies prior to the adoption of the local development document or local development plan, it may be possible to judicially review the Inspector s report. Indeed, the absurdity of the position outlined above may be a further argument to be raised in the interpretation of cl.78 so that its ambit is confined to challenges to adopted plans. Once again, the problem arises in determining who should be the respondent to such a challenge. On a final note, cll.78(5) (7) give the court similar powers to those contained in s.287(2) to suspend or quash in the event that a statutory challenge is successful. Thus the problems identified in First Corporate Shipping Ltd v North Somerset Council apply equally to the new jurisdiction. It is to be regretted that the opportunity has not been taken to remedy this well recognised deficiency. On the other hand, in so far

10 Challenges to Development Plans 1393 as an action is available by means of judicial review outside cl.78, then the remedies available to the court will be wider. It will be open to the court to grant the more appropriate remedies highlighted by Buxton L.J. in First Corporate Shipping such as a declaration or the quashing of only one step in the process.