Land and Development Ltd. v First Secretary of State

1. HIS HONOUR JUDGE RICH: This is an application under section 288 of the Town and Country Planning Act 1990 to quash a decision of the first respondent dated 8 April 2003. By that decision he rejected the recommendation of his inspector to allow an appeal against the decision of the second defendant made on 31 May 2000 whereby planning permission was refused for a development on a 3.233 hectare site at Oak Mere, Cheshire for housing and B1 commercial use. The commercial use was intended to take place in a courthouse which had been allowed to fall at the least into dilapidation. It was proposed to be refurbished in order to provide 900 square metres of office space and incidentally improve accommodation for the bats which were roosting in the derelict building. The residential provision for some forty to fifty dwellings was intended to be carried out on the rest of the site which had established use rights for industrial and storage purposes. Part of the area presently being used for industrial purposes was intended to provide car parking space for the offices, which provision was said to be essential for the establishment of the office use in that building.

2. The appeal was determined by the Secretary of State himself -- in fact as we know from a witness statement prepared for the purposes of this application by a decision maker on his behalf -- because jurisdiction was recovered on its being noted that the use and proposed development of the site might affect an area of conservation importance known as Oak Mere, which is an adjoining lake.

3. The inquiry was a reopened inquiry after the appeal had first been heard by another inspector who himself dismissed the appeal on 16 November 2000 but that decision was by consent quashed on 1 May 2001, the Secretary of State accepting that the failure to consider the question of housing need in the context of PPG3 was a failure to have regard to a material consideration.

4. The Secretary of State's decision dismissing the appeal again is now challenged on four separate grounds. The first is expressed thus in the skeleton argument prepared on the claimant's behalf by Mr Manley:

"The Secretary of State fails to take into account and weigh in the planning balance the consequences of refusing the scheme or give any reasons as to why the balance favoured refusal of the scheme site."

5. There is no dispute between the claimant and the Secretary of State that it was of course a material consideration that the site in its existing state was both unsightly and had environmental effects which to a degree the carrying out of the development would avoid or overcome. Nor is it in dispute that that fact is a material consideration. What is in issue is whether the Secretary of State in the decision that has been made considered properly the elements of benefit from the development or, putting it in the obverse way, detriment from the refusal of permission sufficiently or at all.

6. Some of the points which Mr Manley has presented to the court in my judgment smack too much of an attempt to re-run the merits of the planning appeal to need lengthy consideration by the court and I am grateful to him for the judgment with which he has avoided pressing, beyond the limit of what may be acceptable, such points. It may be that it is enough merely to mention those that I feel fit into such categories. He referred to the visual improvement that would arise from the refurbishing of the courthouse and from the removal of the unsightly industrial and storage uses. The Secretary of State noted them; that he did not elaborate or set them out as a formal part of any balancing act does not seem to me to justify the conclusion that he did not consider them properly. The carrying out of the development would achieve, as a necessary part of it, a highway improvement. That was acknowledged by the Secretary of State. He did not dwell on the accident record that made such highway improvement desirable. I do not think that it was necessary for him to do so in order for this court to assume that he had regard properly to the matters which had been proved before his inspector and identified in his inspector's report.

7. One matter, however, remains in my judgment of more significance to the acceptability of the Secretary of State's decision. As I have already noted, his jurisdiction to determine the appeal was recovered precisely because of the potential effect upon the Mere with its particular significance in conservation terms. His inspector had said at paragraph 74 of his report that:

"There is no dispute about the importance and vulnerability of Oak Mere, and that the continued drainage of the site towards Oak Mere during and after the proposed development would be potentially harmful to the Mere's value for nature conversation."

That recognised what had justified the recovery of jurisdiction: the importance and vulnerability of the Mere. The Secretary of State for his part recorded that he agreed with the inspector about the importance and vulnerability of the Oak Mere and that drainage arrangements for the site needed to be effective to divert drainage of the site away from the Mere.

8. Those sentences deal exclusively with the effect upon drainage of the carrying out of the proposed development. They are, in my judgment, properly considered by the Secretary of State in his decision letter and having reached the conclusion on other grounds that planning permission should be refused, the Secretary of State merely expressed doubts about a matter where the inspector had reported favourably to the appellant, namely the effectiveness of the proposed drainage arrangements to overcome problems that might arise from the carrying out of the development. Having expressed such doubts, the Secretary of State said:

"... as there are sufficient reasons to refuse planning permission on other grounds, he has not required further information [in regard to that drainage proposal]."

9. The appellant had however raised a different, albeit incidental, point that the existing position of the appeal site itself involved potentiality of damage to the Mere by reason of the existing form of drainage, particularly from the industrially used part of the site, into the Mere. The representations of English Nature had identified the process by which some part of the deterioration of the water conditions within the Mere arose from the appeal site. They are recorded at paragraph 56 of the inquiry report as saying:

"The adverse impact would be likely because it is already evident that the drain leading to Oak Mere from the appeal site has been a source of nutrient enrichment and that the near natural water quality of the Mere has over recent years become enriched with nitrates, phosphates and other contaminants."

10. The diversion of the drainage system which was proposed to accompany the development would avoid that present impairment of the natural quality of the water. The inspector recorded that the proposed drainage arrangements could be relied upon to divert the drainage of the site effectively away from Oak Mere -- that is a matter as to which the Secretary of State was not satisfied but did not think it necessary to be satisfied because he was minded to refuse planning permission in any event. But the inspector went on:

"This would be a substantive benefit [by which I think he meant either substantial or at least significant] given that the deterioration of water quality in the Mere has in part been attributed to the existing drainage system."

11. In failing to investigate as a matter of fact whether that benefit could in fact be achieved, the Secretary of State was implicitly saying this so-called substantive benefit is not a matter which he wished to weigh against the other considerations arising mostly from the form of the development plan, leading to his refusal of permission.

12. Mr Morgan, for the Secretary of State, accepts that the Secretary of State has in fact failed to have regard to this consideration but says that it is not a reason for quashing the decision because the point never featured as one of any substance in the submissions made to the inspector and he draws particular attention to one of the principles enunciated by Glidewell LJ in his judgment in Bolton Metropolitan Borough Council v Secretary of State [1990] JPL 241 at 249. He there said:

"If the judge concluded that the matter was 'fundamental to the decision,' or that it was clear that there was a real possibility that the consideration of the matter would have made a difference to the decision, he was thus enabled to hold that the decision was not validly made. But if the judge was uncertain whether the matter would have had this effect or was of such importance in the decision-making process, then he did not have before him the material necessary for him to conclude that the decision was invalid."

Mr Morgan points to the very modest weight that appears to have been placed upon this potential benefit in the evidence placed before the inspector and in the final submissions made to the inspector by Mr Manley who appeared for the claimant at the inquiry as well as before this court.

13. I have, however, overcome my doubts as to the importance of this consideration in a decision-making process having regard to the fact that it was the importance of the Mere which justified the decision being recovered by the Secretary of State himself. In those circumstances it does seem to me that if the decision-maker had properly understood the nature of this potential benefit it would not have been possible to make the decision without being satisfied one way or the other as to whether or not the benefit could in fact be achieved. If the benefit could be achieved, that must in the circumstances have been a matter which the decision-maker would have wished to weigh with some care against the identified detriment to the objectives set out in the development plan upon which the decision was based.

14. For that reason I have come to the conclusion that this is a decision which should be remitted to the Secretary of State, although I do not think that the claimant should, in proving successful on such ground, count too many chickens before they are hatched because it is quite likely, as well as being open to the Secretary of State, to reach the same conclusion having considered fully the matter which in my judgment he failed to do.

15. I think it right and fair in the course of the judgment, although it is not immediately material to what I have to say in the judgment to note that the nature of the emphasis given to this point in the submissions and evidence before the inspector, do provide an explanation as to why it was not highlighted and dealt with in the decision letter in the way in which I have been satisfied by the arguments of Mr Manley it should have been.

16. Having reached that conclusion on that ground, I think it probably more helpful to the parties that I should not give unnecessarily detailed judgment in regard to other points that have been raised because at the remitted inquiry it will be open, in any case as I understand it, for the appellant to start once again with a clean sheet and the matters which have been complained of in regard to the decision letter in other respects will be matters which can be in any case reopened and reformulated and reinforced by further evidence as appears to the appellant to be appropriate.

17. It is complained that the Secretary of State failed to take into account a material consideration, namely the Structure Plan housing requirement and/or give any adequate reasons for failing to address it. It is common ground that the Structure Plan required the provision of a particular quantity of housing within the district of Vale Royal Borough Council by the year 2011. The Borough Council had prepared a Local Plan which provided for housing up to the year 2006. The Secretary of State decided -- and Mr Manley accepts was entitled to decide on the material placed before the inspector -- that he was not satisfied that there was a shortfall in housing supply down to the year 2006, although the appellant had argued the contrary. The appellant had argued as an a fortiori proposition that there was a shortage beyond 2006 which the local authority had addressed by a monitoring exercise and a capacity study which had not however produced any final conclusions that were placed before the inspector. Mr Manley argues that the Secretary of State was under an obligation to consider the position for the whole period of the Structure Plan or at the least to explain in response to the submissions on behalf of the appellant why he did not do so.

18. I am inclined to think that the first of those propositions is wrong and the second is right and that it would have been open to the Secretary of State to explain why he was prepared to base his conclusion exclusively on consideration of the position down to 2006. I would not, however, found a decision to quash this decision only on that consideration. I think that the question of housing need and supply was addressed at the inquiries. It remained less than clear after two lots of inquiry. The Secretary of State formed a judgment on the basis of what had been established before him and had that been the sole matter upon which this decision could be impugned, I would have been reluctant to quash for a second time on that basis. It does, however, give me some relief that if there is properly more to be said on that issue, it is something that can be said in the context of yet further passage of time if the inquiry is reopened for the reason which I have already indicated.

19. Mr Manley said next that the Secretary of State failed to take into account in his analysis of sustainability issues the fact that conversion proposal for the courthouse had the potential to create a significant number of jobs. He added to that a number of additional considerations as to the nature of the application being a 'mixed use' proposal, such that its presence could add to the sustainability of the adjoining housing and no doubt vice versa. On this submission however being tested in argument, Mr Manley felt constrained to abandon the submission that improper consideration had been given to the provision of employment and I do not think that there is anything else in the related points which would have justified the intervention of the court in this decision.

20. Finally it is said, and this is a point which raises more than one issue, that the Secretary of State in his consideration of the visual impact of the scheme made a fundamental error, relied on an immaterial consideration and reached a perverse conclusion. The fundamental error which he is said to have made concerned the relationship of an adjoining housing estate to the main road. The error was apparent on the face of the decision. Mr Manley has accepted evidence on behalf of the Secretary of State that this was an error in what was written in the decision but not in the decision-making process and has not pressed this aspect any further, as it appears to me entirely properly.

21. It is said, however, that there was reliance upon an immaterial consideration. That immaterial consideration was the judgment as to the visual impact of the proposed housing estate upon the surroundings and the form and character of the village of Oak Mere. The first inspector, whose decision had been quashed because of his treatment of housing supply issues, had formed the view that the visual impact was unsatisfactory. The second inspector took a different view. The Secretary of State in his judgment agreed with the first inspector and said so. Mr Manley submits that in doing so he had regard to an immaterial consideration, namely the judgment of the first inspector.

22. It is right, in my judgment, that the decision of an inspector which is quashed is of no effect. That is why upon a remitted question being the subject of a renewed reopened inquiry, except by agreement the parties start again with a clean sheet. But it does not mean that that which an inspector has previously decided after evidence, after having a view and after applying his planning judgment, is not at least potentially a material consideration. The weight to be given to such other judgment is a matter for the decision-maker on any reopened inquiry. But it is, if it is a matter of planning judgment in identical circumstances, in my judgment at least desirable to explain why the second judgment differs from the first. It is at least convenient for the parties to be able to start at the second inquiry from the stage that had been reached at the first, so that any attempt to alter the basis of judgment at least has regard to the earlier judgment; and that indeed is the course which was followed by this appellant in this appeal in at least one and I think at least two separate matters.

23. I do not say that the report of the first inspector is necessarily in whole something to which a second inspector must have regard, still less is a matter which he must follow even if it concerns matters which are not impugned in the decision quashing the decision of the earlier inspector. Materiality is always a matter of judgment. But that it is a matter which may be taken into account if the decision-maker thinks that it is material seems to me to be self-evident.

24. Finally, Mr Manley submitted that the conclusion was perverse. The argument can, I hope not too shortly and therefore too unfairly, be summarised thus. The appeal site is well screened, thus the decision-maker attached little importance to the advantage in terms of visual impact upon the village of removing the unsightly existing uses. If, however, the appeal site was to be developed with housing, the resultant housing estate would appear as an isolated housing estate in a relatively remote location. If, says Mr Manley, it did not appear sufficiently in the view for its alteration to effect benefit, how could it appear sufficiently in the view for its alteration to create that unsatisfactory impression? The answer seems to me to be very simple. In judging the effect of the housing estate upon the character and form of the village, it is obvious that a new housing estate within the village becomes part of the village. Its impact upon the village must be judged from within it as well as outside it. There are other reasons no doubt which would justify modestly different approaches to the effect of visual impact upon two kinds of development. It is, it seems to me, impossible to allege that matters of judgment of this sort indicate perversity by the decision-maker and that ground must therefore be dismissed.

25. MR MANLEY: My Lord, I have an application for costs. A schedule was served.

26. HIS HONOUR JUDGE RICH: Yes, I have a copy. You will have appreciated at least part of the purpose of my tangential observations.

27. MR MANLEY: My Lord, there is an application for costs. Certain matters were served and they relate to costs in the sum of £13,558.68 but I have just been handed an invoice which I think should have been served by was not, for £1,453.69 which is the charge levied by Mr Gilbert, the planning consultant, which did not find its way to the schedule for attending initial conference with counsel, comments on grounds for challenge and settling witness statements. In substance he has charged 7.25 hours at £75 an hour.

28. HIS HONOUR JUDGE RICH: I am not quite certain -- he was not instructing you, was he? He was a witness.

29. MR MANLEY: He was a witness, but initially when the decision letter came through he instructed me to review it.

30. HIS HONOUR JUDGE RICH: Maybe he did. But it is not his instructions, as I understand it, which came from solicitors, but his assistance in the judging of issues of law which is all that could be the subject matter of the application.

31. MR MANLEY: My Lord, I accept that.

32. HIS HONOUR JUDGE RICH: What do you say, Mr Morgan?

33. MR MORGAN: My Lord, two questions. The first is whether and to what extent you should order costs, and secondly how to quantify those costs once they have been awarded. I would not oppose an award of costs to the claimant, my Lord, but in view of the number of issues which are raised and the relative scope of the success its proper, in my submission, for there to be a reduction under CPR 44 and in my submission it would be appropriate to award 50 per cent of the claimant's costs having regard to those matters.

34. HIS HONOUR JUDGE RICH: Yes.

35. MR MORGAN: One can identify a number of issues in all sorts of ways and end up with all sorts of results but your Lordship has too --

36. HIS HONOUR JUDGE RICH: I had in mind that perhaps 50 per cent might not err too far on the side of generosity to the claimant.

37. MR MORGAN: My Lord, I am grateful. That would be my submission.

38. HIS HONOUR JUDGE RICH: You would be content with that?

39. MR MORGAN: My Lord, yes.

40. HIS HONOUR JUDGE RICH: I will hear what Mr Manley has to say about that, but can there be agreement as to what 50 per cent of whatever is justified out of £13,500 is?

41. MR MORGAN: My Lord, so far as that is concerned in relation to the fees of Mr Gilbert my submission would echo your Lordship's comments.

42. HIS HONOUR JUDGE RICH: Those do not appear I think, do they?

43. MR MORGAN: If they are abandoned -- I am not sure they are abandoned.

44. HIS HONOUR JUDGE RICH: They are disallowed, I think you can take it.

45. MR MORGAN: In relation to the other matters, my Lord, only two points. There is nothing in general about the costs and I hesitate to criticise my learned friend's fees, but they are significantly higher than in our schedule which I hope your Lordship also has.

46. HIS HONOUR JUDGE RICH: No, I have not. He had a harder case.

47. MR MORGAN: Can I hand you our schedule? (Handed).

48. HIS HONOUR JUDGE RICH: Mr Manley, you have not been in silk since 1981, I suspect.

49. MR MANLEY: No, no, not at all. My Lord, can I explain why my fees are such as they are. You will see, if you look at the defendant's costs, that they claim 33.5 hours of work on the documents. I do not suggest that is unreasonable but in this case the person doing all the work on the documents on the claimant's side was me and exclusively me. So there was a phenomenal amount of time put into reviewing everything, including a very, very substantial transcript.

50. HIS HONOUR JUDGE RICH: Yes. I think that the part of the costs which is under challenge is the fee which has been charged on your behalf for the hearing, which is about four times that of Mr Morgan.

51. MR MANLEY: My Lord, in my experience that sort of fee is not unusual.

52. HIS HONOUR JUDGE RICH: How fortunate for you. But the question is whether it is reasonable and proper having regard to the not unusual fee which is paid less generously out of public funds.

53. MR MANLEY: Yes, my Lord. Well, I leave it to your Lordship to decide whether or not the fee is proportionate.

54. HIS HONOUR JUDGE RICH: If I am acquitted of dealing with this item by item, I would propose to assess costs, half the costs at £6,000. Would you have anything more to say if I adopted that approach?

55. MR MANLEY: It is entirely a matter for your Lordship's discretion. On that basis I do not pursue it any further.

56. HIS HONOUR JUDGE RICH: Very well then. Claimant's costs assessed at £6,000. Should that be plus VAT, or you have already included it?

57. MR MANLEY: VAT was excluded.

58. HIS HONOUR JUDGE RICH: Very well. Thank you very much. Is there anything else?

59. MR MORGAN: My Lord, I have instructions to apply for permission to appeal in relation to the point in which you have found against us, bearing in mind the submissions I made and that I need to make the application at this stage rather than at some later time.

60. HIS HONOUR JUDGE RICH: What you would have to say is that I could not properly have concluded that it might have affected the decision-maker's judgment. I do not think there was anything else that was in dispute, was there?

61. MR MORGAN: My Lord, no. My submission is that where your Lordship is sitting in effect as a judge in point of law, which is pretty much what it comes down to, then the test in the Court of Appeal would be very much the same as it is before your Lordship.

62. HIS HONOUR JUDGE RICH: But there is not, I think, any issue of law between us. The submission you would have to make to the Court of Appeal is that I, as a reasonable judge, could not have concluded that this factor could have affected the judgment of the decision-maker. Is that right? That is what you would have to say, is it not?

63. MR MORGAN: Yes.

64. HIS HONOUR JUDGE RICH: There is no other element of alleged error of law in what I have decided on that point, is there?

65. MR MORGAN: My Lord, that is right, I think I would have to --

66. HIS HONOUR JUDGE RICH: I do not think that there is reasonable prospect of success on so narrow an issue and I refuse permission. Very often in these cases I have asked for an extension of time to make an application until 14 days after the transcript. I do not know whether if that were asked for would you resist it?

67. MR MANLEY: My Lord, no.

68. HIS HONOUR JUDGE RICH: Then in that case I will grant it.