Next Group Plc v First Secretary of State

MR JUSTICE SULLIVAN: This is an application under section 288 of the Town and Country Planning Act 1990 ("the Act") to quash a decision of one of the first defendant's inspectors which is contained in a decision letter dated 31st March 2004.

The Inspector dismissed the claimant's appeal and refused planning permission for the installation of a mezzanine floor of 1,000 square metres gross at its store in the Serpentine Green Shopping Centre, Hampton, Peterborough. The existing store has 1,015 square metres of gross floor space at ground floor level.

The background to the appeal in terms of the planning history and the relevant planning policies is set out in paragraphs 1 to 11 of the decision letter in terms which are not criticised by the claimant.

In brief, the Serpentine Green Shopping Centre ("the centre") is a free standing shopping mall with a total floor space of around 26,000 square metres of which just over 12,000 square metres gross is occupied by a Tesco Extra store.

Hampton is one of four township developments in Peterborough. At the top of the shopping hierarchy there is the city centre. The role of the township centres is described in paragraph 3 of the decision letter:

Normally the installation of a mezzanine floor would not require planning permission provided no external alteration was made to the building. In the case of the units in the centre, planning permission for the installation of mezzanine floors is necessary because conditions were imposed in the approval of reserved matters preventing the modification or alteration of the layout or size of the units in the centre without permission.

In terms of planning policy the Inspector referred to policies in the Peterborough Local Plan of 1996. Policy S5, amongst other things, limited the size of the food store at the centre to 6,000 square metres gross and the overall gross floor space of the centre to 26,000 square metres.

In paragraph 10 the Inspector noted that:

It was contended on behalf of the second defendant, the local planning authority, that the claimant's proposals failed three criteria in emerging Policy R1. Policy R1, so far as material, is in the following terms:

It is fair to note at this stage that, as part of its case, the second defendant contended:

Against this policy background the claimant does not take issue with the Inspector's identification of the main issue as follows:

In paragraph 13 the Inspector considered Peterborough city centre. He accepted the Council's view that new investment was needed in the centre and said that it was proposed to be in the North Westgate area, which had been earmarked for comprehensive development for city centre uses. That development was aimed at reinforcing the city centre's primacy in the retail field.

In paragraph 14 of the decision letter the Inspector dealt with the Serpentine Shopping Centre and said:

In paragraph 15 the Inspector said this:

Pausing there, the claimant accepts that the Inspector was entitled to conclude, as a matter of planning judgment, that this was indeed the effect of the relevant planning policies.

The claimant's criticisms of the decision letter are confined to the Inspector's reasoning in paragraph 16:

The Inspector therefore concluded in paragraph 17:

In the claim form it was contended that the Inspector's reasoning was inadequate because he had failed to address five matters:

The Inspector has provided a witness statement in which he explained that:

Although there was initially objection to the Inspector's witness statement being produced in evidence, in his submissions before me Mr Lowe QC, who appeared on behalf of the claimant, very fairly accepted that the thirteen units referred to by the Inspector in paragraph 16 of his decision letter did indeed exclude the Tesco Extra store. Even if the Inspector's witness statement was disregarded, it is plain that this was the position from the exhibits to the second witness statement of Mr Wilson, the claimant's planning consultant. Those exhibits comprise an extract from the council's planning witness' proof and a plan of the centre from which it is plain that when the Inspector was referring to the thirteen units he was not including the Tesco Extra store which was on a wholly different scale and could not fairly be regarded as a "similar proposal".

Mr Lowe further accepted that ground (v) went more to the planning merits and it was not pursued in submissions before me.

In setting out his reasons, it is common ground that the Inspector was not required to deal with each and every detailed point that was raised before him. His conclusions must deal with the "principal important controversial issues" - see paragraph 36 of the speech of Lord Brown in South Buckinghamshire District Council and another v Porter (No 2) [2004] UKHL 33.

I agree with Mr Brown's submission on behalf of the Secretary of State that, on any basis, the matters complained of in grounds (iii) and (iv) are not in the category of principal issues which called for separate mention in the Inspector's reasoning.

Point (iv), the fact that the claimant was pursuing a search for a larger store within the city centre, was briefly mentioned at the conclusion of Mr Lowe's closing submissions to the Inspector. There is no reason to doubt Next's good faith, but its future intentions in the town centre could not realistically be made the subject of any planning condition and no section 106 agreement or undertaking was on offer. Planning permission runs with the land and thus there could be no guarantee that Next would stay either in the town centre or in the centre.

So far as point (iii) is concerned, two planning permissions had been granted for small mezzanine extensions. In aggregate they did not amount to the floor space proposed in the claimant's application. In my judgment, they did not require special mention. As the claim form points out, the Council's own witness had made the point that those two extensions were considered "too small to have any significant retail planning implications". The claimant's approach to this was, in effect, to endorse that judgment and to say (in Mr Lowe's closing submissions to the Inspector) that the message from this was "get real", "there is no harm". In the circumstances, since both parties were making the same point, that is to say there were no significant planning implications from those two permissions, it was not necessary for the Inspector to mention them, provided of course he realised that they would have been an illustration of the general proposition that each planning application has to be considered on its own merits.

That leaves ground (i), which was, in effect, the only ground relied upon by Mr Lowe in his submissions before me.

He fairly conceded that the Inspector must have been well aware of the general proposition that any further application for the installation of a mezzanine floor would have to be considered upon its own individual merits at the time the application was made. It is precisely for this reason that we find the Inspector saying in the first sentence of paragraph 16 that "the question of precedent as a material consideration should be used with care". The Inspector in making that point was, in my judgment, responding to the claimant's submissions in which it had been said:

On any fair reading of paragraph 16 one would conclude that the Inspector recognised that, looked at in isolation, Next's proposal would not be harmful. As he says in the third sentence:

Against this background, I find it impossible to accept Mr Lowe's submission that the Inspector's reasoning was in some way inadequate because he failed to deal expressly with the point that, when considering any further application for the installation of a mezzanine floor on its merits, the local planning authority would have to have regard to the position as it was at that time, and in having regard to policy S5 would be able to have regard to the extent at that time of the excess floor space over the 26,000 square metre threshold; or that it would be able under policy R1 of the emerging local plan to consider the effect of the proposal on the town centre in the light of the floor space that had been permitted at the centre by that time. In general terms, the claimant argues that if the amount of floor space permitted at the centre increased, so the local planning authority would find it easier to say that the excess over 26,000 square metres would be harmful to the town centre and/or that, applying the qualitative criteria in policy R1, the town centre was being placed at greater risk of harm.

Mr Lowe submits that that is a simple point. I agree. These are the kind of considerations that necessarily follow from the obligation to consider each application on its merits in the circumstances as they exist at the time when the application is made. In this context it will be noted that the Inspector was concerned with what the position would be "over time", and over time it is to be anticipated, all other things being equal, that the quantitative threshold in policy S5 of the 1996 Local Plan will in due course be replaced by the qualitative criteria set out in policy R1 of the First Replacement Local Plan.

As Mr Brown pointed out, if those qualitative criteria were to be applied and one was assessing whether the city centre strategy or proposals for its implementation were being put at risk, one would be considering that issue not against the benchmark of an upper limit of 26,000 square metres for the centre, but as against a benchmark of whatever the increased amount of floor space was in the centre at that time. As the Inspector said, in respect of other similar proposals it would be difficult to resist them on an individual basis given that, looked at individually, they would be no more or less harmful than the appeal proposal. Although granting Next's application would mean that there would be more than 26,000 square metres of space at the centre, it would follow that later proposals to add 1,000 square metres would result in a lesser percentage increase over the new benchmark figure even though, in absolute terms, there would be a further increase over the original figure of 26,000.

It is to be noted in this context that the claimant itself referred to the granting of permission for the two smaller planning permissions, making the point that it was necessary to "get real" because it was acknowledged that they had done no harm. In considering any subsequent application, the background position would be that permission would have been granted not merely for the two smaller applications but for Next's application, and no doubt the "get real" argument would be repeated.

These kinds of arguments are well familiar to those who are dealing with issues of precedent in the planning context. It is simply unrealistic to suppose that the Inspector lost sight of them. In my judgment, he was not required to rehearse them in his reasons; that would require him to give reasons for reasons. As Mr Brown put it, with a number of similar proposals, any one of which being "relatively small" in itself, it would be extremely difficult for the local planning authority to contend that any particular proposal would be "the straw that broke the camel's back". That, in essence, was the Council's argument and in substance that is the argument which the Inspector accepted in paragraph 16 of the decision letter. In so doing, in my judgment, he grappled adequately with the main issue that he had identified in paragraph 12.

It is submitted that the claimant is prejudiced by the lack of reasoning in paragraph 16 of the decision letter. The test is of course an omnibus one. In deciding whether or not the reasons are adequate, one must consider the question whether any alleged inadequacy substantially prejudices the recipient of the decision letter. The prejudice is put in this way in Mr Lowe's skeleton argument: "the [decision letter] gives no indication to Next as to what extension proposals on a scale less than a full floor mezzanine or for purposes other than retail sales eg storage or administration would be likely to be acceptable". In his submissions before me he mentioned that Next had a very large number of stores and since this was either the first or one of the first applications to install a mezzanine floor Next wished to know where it stood.

As to the latter of those points, it is plain that this decision letter is rooted in the circumstances of this particular centre. The Inspector was not purporting to give any wider guidance as to the acceptability or otherwise of mezzanine floors.

As to the first of those points, I do not accept that there can be any prejudice. The Inspector was not asked to give consideration to a proposal for a mezzanine using up less than a full floor or a mezzanine for ancillary purposes such as storage or administration. He was being asked to approve a mezzanine proposal which, in effect, doubled the gross floor space of the store. He dealt with the merits of that proposal. He was not asked to, and did not therefore, give any guidance as to what other mezzanine proposals might or might not be acceptable within the Next store.

For these reasons, I am satisfied that the Inspector did grapple with the main issue that he identified, that he did deal with it adequately and that there has been no prejudice to the claimant. It follows that the application must be refused.

MR BROWN: My Lord, I am very grateful for that. In the circumstances I have an application for an order that the claimant pay the first defendant's costs. My Lord, I would ask for those costs to be summarily assessed. If I could pass the scheduled statement of costs to your Lordship, you will see the overall amount is that set out at the bottom of the second page, £5,984.

MR JUSTICE SULLIVAN: Is there any argument about either the principle first or the details?

MR LOWE: My Lord, there is no argument as to either, and my instructing solicitor is quite satisfied with the costs claimed.

MR JUSTICE SULLIVAN: Thank you very much, that is very helpful.

The formal order of the court is application dismissed, the claimant to pay the first defendant's costs, those costs to be summarily assessed in the sum of £5,984.