CO/10024/2006
Royal Courts of Justice
Strand
London WC2
B E F O R E:
MR JUSTICE GOLDRING
(1) MICHAEL MCCABE
(2) ANIS MCCABE
(3) WASSEM BAIG
(4) GIOVANNI BASALOU
Claimants
-v-
THE SECRETARY OF STATE FOR COMMUNITIES AND LOCAL GOVERNMENT
Defendant
THE URBAN REGENERATION AGENCY
(operating under the name ENGLISH PARTNERSHIPS)
Interested Party
(Computer-Aided Transcript of the Palantype Notes of
Wordwave International Limited
A Merrill Communications Company
190 Fleet Street London EC4A 2AG
Tel No: 020 7404 1400 Fax No: 020 7831 8838
Official Shorthand Writers to the Court)
MISS KATE OLLEY(MR CHARLES BANNER appeared of the purposes of judgment only) (instructed by Public Interest Lawyers, Birmingham B1 6HJ) appeared on behalf of the Claimants
MR JAMES MAURICI(MR DAVID BLUNDELL appeared for the purposes of the judgment) (instructed by Treasury Solicitor) appeared on behalf of the Defendant
MISS FRANCES PATTERSON QC (instructed by Eversheds) appeared on behalf of the Interested Party
J U D G M E N T
MR JUSTICE GOLDRING:
Introduction
In this application the claimants challenge the validity of an order for compulsory purchase made on 12 December 2005 by the Urban Regeneration Agency, (known as English Partnerships ("EP")). The order in question is the Urban Regeneration Agency (Lime Street Gateway, Liverpool) Compulsory Purchase Order 2005. It was made under section 162(1) of the Leasehold Reform, Housing and Urban Development Act 1993. It relates to approximately 0.49 hectares of land in front of Liverpool station. The claimants' challenge is under section 23(1) of the Land Acquisition Act 1981.
The statutory and other provisions
Section 158(1) provides:
"There shall be a body corporate to be known as the Urban Regeneration Agency for the purpose of exercising the functions conferred on it by the following provisions of this Part."
Section 159(2)(b) is at the heart of this application. Section 159 provides:
The main object of the Agency shall be to secure the regeneration of land in England
which is land of one or more of the descriptions mentioned in subsection (2) ...
The descriptions of land referred to in subsection (1)(a) are -
land which is vacant or unused;
land which is situated in an urban area and which is under-used or ineffectively used ...
The Agency shall also have the object of securing the development of land in England which the Agency -
having regard to guidance given by the Secretary of State under section 167;
acting in accordance with directions given by the Secretary of State under that section; and
with the consent of the Secretary of State,
determines to be suitable for development under this Part.
The objects of the Agency are to be achieved in particular by the following means (or by such of them as seem to the Agency to be appropriate in any particular case), namely -
by securing that land and buildings are brought into effective use;
by developing, or encouraging the development of, existing and new industry and commerce;
by creating an attractive and safe environment;
by facilitating the provision of housing and providing, or facilitating the provision of, social and recreational facilities."
By section 162:
The Agency may, for the purpose of achieving its objects or for purposes incidental to that purpose, acquire land by agreement or, on being authorised to do so by the Secretary of State, compulsorily.
The Agency may, for those purposes, be authorised by the Secretary of State, by means of a compulsory purchase order, to acquire compulsorily such new rights over land as are specified in the order…
... the Acquisition of Land Act 1981 shall apply to the compulsory acquisition of land by virtue of subsection (1)...
... 'compulsory purchase order' has the same meaning as in the Acquisition of Land Act 1981."
Section 167(1) provides that:
"The Agency shall have regard to guidance from time to time given by the Secretary of State in deciding -
which land is suitable for regeneration or development under this Part; and
which of its functions under this Part it is to exercise for securing the regeneration or development of any particular land and how it is to exercise those functions."
By section 23(1) of the Land Acquisition Act 1981 any person aggrieved by a compulsory purchase order may question its validity on the ground that the authorisation of such an order is not empowered. He may make an application to the High Court. If the court is satisfied that the order is not empowered to be granted or that the interests of the applicant have been substantially prejudiced by any relevant requirement not having been complied with, it may quash the order.
Guidance
Circular 06/2004
Circular 06/2004, Compulsory Purchase and the Crichel Down Rules, provides (at paragraphs 17 and 18):
A compulsory purchase order should only be made where there is a compelling case in the public interest. An acquiring authority should be sure that the purposes for which it is making a compulsory purchase order sufficiently justify interfering with the human rights of those with an interest in the land affected. Regard should be had, in particular, to the provisions of Article 1 of the First Protocol to the European Convention on Human Rights and, in the case of a dwelling, Article 8 of the Convention.
The confirming Minister has to be able to take a balanced view between the intentions of the acquiring authority and the concerns of those whose interest in land it is proposed to acquire compulsorily. The more comprehensive the justification which the acquiring authority can present, the stronger its case is likely to be. But each case has to be considered on its own merits and the advice in this Part is not intended to imply that the confirming Minister will require any particular degree of justification for any specific order. Nor will a confirming Minister make any general presumption that, in order to show that there is a compelling case in the public interest, an acquiring authority must be able to demonstrate that the land is required immediately in order to secure the purpose for which it is to be acquired ..."
Appendix C of the 1993 Act
Specific guidance on compulsory purchase orders is given in Appendix C of the 1993 Act.
Paragraph 3 states:
"The Government has ... identified EP as a key delivery agency in the Government's sustainable communities agenda to regenerate the towns, cities and rural areas of England and as the national catalyst for property led regeneration and development. It is charged with delivering urban renaissance and helping the Government meet its targets for accommodating household growth on brownfield land. EP is clearly in a position to utilise the Urban Regeneration Agency's compulsory powers to assist it in fulfilling this role."
Paragraphs 7 to 9 state:
It is for EP to decide how best to use the ... land acquisition powers to fulfil its purposes and in accordance with any guidance which may be issued from time to time by its sponsoring Department. The fact that the powers have been expressed in wide and general terms, together with the Government's statement mentioned above, reflects the national importance of the task facing EP. While EP should seek to acquire land by agreement wherever possible, it is recognised that this may not always be practicable and that it may sometimes be necessary to use the ... [compulsory purchase] power to make an order at the same time as attempting to purchase by agreement ...
EP is charged with securing the regeneration of types of land which may be unattractive to existing or potential residents, developers or investors, and therefore need the catalyst of public sector commitment to turn them round ... The fact that EP takes steps to acquire land in an area can stimulate confidence that regeneration and/or economic development will take place, and this in itself can help to secure investment. It also facilitates a coherent and comprehensive approach to regeneration. Thus, the power available ... to acquire and merge plots of land in different ownerships provides a vital instrument for implementing regeneration projects for the public benefit and at a realistic cost.
EP must justify the use of its ... compulsory purchase powers by showing that such action is in fulfilment of its statutory purposes, although there may be other additional valid reasons for the proposed acquisition ... Whatever the justification, it should normally have been included in EP's Corporate Plan or other form of general framework ..."
Paragraph 14 states:
"In reaching a decision about whether to confirm an order made under section 162 of the 1993 Act the Secretary of State will have in mind the statutory purposes of the Urban Regeneration Agency and will, amongst other things, consider:
whether EP has established the basis and justification for its actions through its Corporate Plan ... which should be in general accordance with regional and local planning policies and other guidance referred to in paragraph 9 above;
whether, where appropriate, EP has demonstrated that the land is in need of regeneration;
any directions and guidance which may be given under section 167 and (in the case of development) any consent under section 159(3);
what, if any, alternative proposals have been put forward by the owners of the land or by other persons for the use or re-use of the land; whether such proposals are likely to be, or are capable of being, implemented, (including consideration of the experience and capability of the landowner or developer and any previous track record of delivery); what planning applications have been submitted and/or determined; how long the land has been unused; and the extent to which the proposals advocated by the other parties may conflict with EP's proposals as regards the timing and nature of the regeneration of the wider area concerned;
whether the proposed development or regeneration is, on balance, more likely to be achieved if the land is acquired by EP, including consideration of the contribution which acquiring the land is likely to make to stimulating and/or maintaining the long-term regeneration of the area;
whether, if EP intends to carry out direct development, it will not thereby, without proper justification, displace or disadvantage private sector development or investment, and that the aims of the URA cannot be achieved by any other means;
the condition of the land and its recent history ..."
The facts
As I have said, the order concerns about 0.49 hectares of land and buildings. It is located in the front of Lime Street Station in Liverpool. It essentially comprises a complex known as "Concourse Tower". The "Concourse shops" comprise 13 small retail units. "Concourse House" is a 13-storey high 1970s office block. It is vacant. The inspector described it as being "rather shabby in external appearance as generally are the shops with only 6 units occupied, by 5 businesses." Most of the area in which Concourse Tower lies is within a Conservation Area. EP bought the freehold of the shops in 2002 and the tower in 2004. The claimants' businesses occupy three of the six occupied units.
The First Claimants, Mr and Mrs McCabe, are the lessees of Henry Bohn Books, Unit 4, Concourse House. The Second Claimant, Mr Baig, is the lessee of The International Leather Store, Unit 5, Concourse House. The Third Claimant, Mr Basalou, is the lessee of the Concourse Café (trading as Punch and Judy Snacks Limited), Unit 13, Concourse House.
At paragraph 62 of his report the inspector described Mr and Mrs McCabe's bookshop as:
"A well-stocked ground floor second hand and antiquarian bookshop (in two sections), with basement storage below. At the time of inspection the shop had several customers."
Mr and Mrs McCabe's shop is one of only two second-hand bookshops in the city centre. One witness, Mr Angluin, described it as a "convenience culture store". Another, Mrs Gersten described how the number of excellent second-hand and antiquarian bookshops in the city centre had diminished. Mr and Mrs McCabe themselves observed in their objection that it was ironic that one of only two such shops was being removed as part of the preparation for Liverpool's year as capital of culture. Miss Olley on behalf of the claimants submits how hugely valuable the shop is: that it deserves protection in its own right.
At paragraph 44 of his report the inspector described Mr Baig's shop as:
"An intensively stocked ground floor shop and basement, selling leather clothes and shoes and other leather items."
At paragraph 28, he described Mr Basalou's property as:
"A large ground floor unit beneath the Concourse Tower, at the junction of Lime Street and Skelhorne Street, which is in active use as a café."
The inspector set out the case for EP in the following terms:
The strategy to regenerate Liverpool City Centre includes improving its major gateways, which include Lime Street Station with its nearby bus station and future tramway. The Station and immediate surroundings have been in decline for some time. Concourse House which topped a newspaper ‘Blot Idol" poll of the City Centre's ugliest buildings ... obscures the Station's architecture and restricts access from Lime Street to the main station concourse. The Gloucester Street access to the station has 21 steps which do not comply with the Disability Discrimination Act (DDA). DDA-compliant accesses are from side streets only.
The Concourse Shops and Tower (Concourse House) also restrict views from within the Station to other parts of the City Centre. The building sits across what would be a natural desire line from within the Station to the main retail core of the Centre. The Tower fails to offer the accommodation or services expected of modern commercial premises. The poor quality of the external fabric and low level of occupancy compound the negative perception of the area. Concourse House is inappropriate to the historic, architectural and townscape context of the area. It projects the wrong image for a City in the process of renewing its offer and revitalising itself…
The objects of [EP] are set out in section 159 ... The Order land is within an urban area, is vacant and underused, and is neglected and unsightly ...
The scheme improves the image of Liverpool City Centre as a regional centre with an appropriate sense of arrival and departure. The integration of a major public space and a landmark building provide a dramatic intervention on a 'civic' scale commensurate with Liverpool's role as a European city. The residential component provides higher value units for owner occupation to strengthen the residential community in the area and address the current social imbalance caused by the domination of student accommodation. The 1800 square metres of new office space will address the lack of high quality new build office accommodation in the City Centre ... ."
The inspector summarised the objections.
I have already referred to some aspects of Mr and Mrs McCabe's objections. Another aspect was a criticism of the quality of the proposed scheme.
Mr Baig argued that:
The order is not necessary to secure regeneration because before EP purchased the freehold ... all shops were fully let. Only since 2002/2003 have some shops become vacant. The gateway to Lime Street has never been under-used or ineffectively used the Lime Street units have always seen an influx of people. It is a vibrant area which EP since purchasing the freehold interests have deliberately neglected and not relet the units when they became vacant. The objector had asked to rent the shop next to his own as it became vacant There has been an attempt ... to destroy [his] livelihood ...
The shops are well used and the area surrounding them is not contaminated, nor are the units derelict. Even if it is argued that the units are unsightly or neglected, that is down to EP's policy as landlord to discredit the area to deprive the Objector of his livelihood."
Mr Basalou's case was that the shops' appearance was misleading. In the hands of an energetic and serious-minded investor the complex would be fully let. Concourse House could be refurbished. The order is a misuse of EP's statutory powers. I shall return to Mr Basalou's objections.
The inspector's conclusions
At paragraphs 80 and 81, under the heading strategic and policy context, the inspector said that:
"The Order is promoted to effect a step change in the appearance, public profile and accessibility of Liverpool Lime Street Station ... This would be consistent with an objective of the overall strategy for the City to regenerate the City Centre by improving its major gateways ... the ... proposals support [the policy] of the Regional Spatial Strategy ... the provisions of which include placing emphasis on the role of Liverpool City Centre, conserving the City's distinct architectural heritage ... adding modern development of high design quality and improving the design and management of the public realm."
At paragraphs 84 and 86 he said:
"The ... development ... would provide for a comprehensive development after the demolition of the existing buildings on the site, to include enhanced access facilities for the Station as part of an open area of striking contemporary design and retail, office and residential units set in a 'landmark' tower of 27 storeys, some 86 metres high ...
The Tower would provide a striking example of contemporary design, being referred to by the Commission for the Built Environment ... as having the potential to be an elegant addition to the Liverpool skyline ... English Heritage recognises that the replacement tower would be an enhancement, contributing positively to the area and of a high standard of design."
He dealt with EP's use of compulsory purchase powers in paragraphs 82 and 83:
Some doubt was expressed about whether English Partnerships (EP) use of its powers under section 162 of the Leasehold Reform, Housing and Urban Development Act 1993 is appropriate... A clear case can be made from the inquiry evidence that the land and buildings within the Order site are vacant, underused or ineffectively used [paragraphs 5, 8, 9, 25-27, 33-35, 37, 53, 59, 67, 78], even if the policy of EP upon acquiring the freehold interest of the shops not to enter into any new lease agreements may have been a small contributory factor to that state of affairs.
The Ministerial statement referred to in paragraph 3 of Appendix C to Circular 06/2004 Compulsory Purchase and the Crichel Down Rules also confirms EP's role as the national catalyst for property led regeneration and development. The circumstances of this Order can be considered appropriate to the exercise of that role, notwithstanding some misgivings about the effect of large corporate regeneration projects on the grain of the City Centre's character ..."
I should refer to the paragraphs relied upon by the inspector in coming to his conclusion in paragraph 82. As will become apparent, I accept Mr Maurici's submission on behalf of the Secretary of State that the inspector basically accepted what was set out in those paragraphs by EP.
Paragraph 5 described "the order lands and surroundings". I have referred to part of it already. It said:
"Concourse Tower is vacant and rather shabby in external appearance as generally are the shops with only 6 units occupied, by 5 businesses. Concourse Tower and the shops (collectively known as Concourse House) effectively form a single building complex, the offices and shops sharing elements of the structure as well as a basement, servicing and access ..."
Paragraphs 8 and 9 set out the "general case for [EP]." Paragraph 8 stated that:
"The strategy to regenerate Liverpool City Centre includes improving its major gateways, which include Lime Street Station with its nearby bus station and future tramway. The Station and immediate surroundings had been in decline for some time. Concourse House which topped a newspaper 'Blot Idol' poll of the City Centre's ugliest buildings obscures the Station's architecture and restricts access from Lime Street ..."
I have set out paragraph 9 above (see paragraph 18).
Paragraph 25 sets out the case for the Third Claimant. Paragraph 27 is EP's response. The inspector recorded the case for Mr Basalou in the following terms:
"The appearance of the existing shop units is misleading, as there are now a number of vacant units which gives the impression of under-utilisation or ineffective utilisation ... EP had acquired a number of units which had been kept vacant and which resulted in the semi-derelict appearance of the shops. If the complex were in the hands of an energetic and serious-minded property investor, then it would be fully let ... it is inappropriate for acquisition to be sought on the grounds referred to."
At paragraph 27 the inspector recorded EP's response:
"When EP acquired the shops and tower, two of the shops were vacant, as were six floors of the tower. The accommodation had not been fully let for many years. No enquiries to occupy either vacant shops or floors within the tower have been received by EP during its period of ownership, other than temporary arts-based uses. Whilst it may be possible to refurbish individual shop units, it is not economically viable to refurbish the tower. Refurbishment of the shops alone, or both shops and tower would not achieve the objectives of the Lime Street Gateway. The buildings create a poor environment and restrict access between Lime Street Station and the City Centre."
Paragraphs 33-5 and paragraph 37 are part of EP's response to Mr Baig's objections:
It is not accepted that there has been any deliberate neglect to maintain or re-let the shops ... The existing buildings are of a poor quality and were poorly maintained prior to their acquisition by EP ... Neither the shops nor the Concourse Tower offer accommodation or services expected of a modern commercial building, particularly in such a key location.
... The accommodation has not been fully let for many years. No enquiries to occupy ... have been received by EP ... Whilst it may be possible to refurbish individual shop units, it is not economically viable to refurbish the tower ...
In relation to the possible retention of the Concourse Tower, the appraisal carried out…[that refurbishment] ... would leave a structure not in keeping with the cityscape ... [It] would only provide lower level residential units ..."
Paragraph 53 is part of EP's response to the objections of Mr and Mrs McCabe. It states:
"... The shop units that remain occupied may be structurally sound and internally in good condition, but by their nature and appearance and that of the Concourse Tower they create a poor environment for Lime Street Station. The property has had a lengthy history of poor occupancy rates and a high turnover of tenants."
Paragraph 59 states that:
"EP is aware of media reports relating to the redevelopment of the Order lands, but is of the view that it is the poor state of repair both of the Concourse Tower and the ... shops that has given rise to the negative remarks."
Paragraphs 67 and 78 refer to the evidence of Mrs Gersten of "The Save Our City Campaign". It was to the effect that no one in Liverpool "would regret the demolition of the structures built in front of Lime Street Station in 1967-68, as they are totally without visual interest. They block the view of the splendid listed train sheds and are most unsuitable neighbours for the listed Crown public house and former Forum Cinema, and particularly unsightly neighbours for the St George's Hall." Mrs Gersten had other objections which I need not go into.
The inspector dealt with the Order proposals and their implementation at paragraphs 84-88. He plainly accepted EP's case regarding them. As he put it in paragraph 86:
"The Tower would provide a striking example of contemporary design ... having the potential to be an elegant addition to the Liverpool skyline ..."
As to the objections, he said this:
The implementation of the Order would result in the discontinuance of the three remaining businesses ... So far as the Objections by the ... Café and International Leather Store are concerned it is possible that a different ... investor could have done more to maximise the continuing occupancy of the Concourse House shops ... However EP acquired the shops and the ... Tower exercising its national role as a regeneration catalyst, to bring about a radical change in the profile, appearance, efficiency and convenience of Lime Street Station ...
If Mr and Mrs McCabe's ... shop were forced to close…the city would be culturally worse off ... Yet however real that loss would be, it is difficult to conceive it as being so fundamental as to justify the abandonment of a key project popularly acclaimed as being of great benefit to the City, its profile and its prosperity."
The inspector considered human rights issues at paragraphs 94 and 95. I need only refer to paragraph 94:
The implementation of the Order would interfere with the property rights of the remaining lessees of the shops under Article 1 of the First Protocol to the European Convention on Human Rights (EHCR). However given the considerable public benefit that would accrue to residents of and visitors to the City by the creation of the Lime Street Gateway in terms of better accessibility to and from the Station, the provision of a high quality mixed-use landmark building and the opening up of the listed façade of Lime Street Station and likely 'knock-on' effects on investments nearby , the action of EP in promoting the Order can be regarded as being proportionate."
The inspector concluded that:
There is on my interpretation of all the evidence a compelling case for the confirmation of the Order which justifies interfering with the property rights of the remaining Objectors."
The Secretary of State's decision letter
On 6 October 2006 the Secretary of State confirmed the inspector's decision. She said that:
The Secretary of State takes the view that a clear case has been made from the inquiry evidence that the land and buildings within the Order are either vacant, underused or ineffectively used (see Inspector's Report (IR) at paragraph 82). She accepts the findings of the Inspector that Concourse Tower is vacant and rather shabby in external appearance (IR5) and the shops are also dilapidated with only 6 of the 13 units occupied. She also agrees with the evidence presented at the inquiry that Concourse House is inappropriate to the historic, architectural and townscape context of the area and that it projects the wrong image for a City in the process of renewing its offer and revitalising itself (IR9). She concludes, therefore, that all the land to which the order relates is either vacant or situated within an urban area and underused or ineffectively used in accordance with the 1993 Act.
She agrees with the Inspector that the proposed 'Gateway' development of the Order lands would provide for a comprehensive development including enhanced access facilities for the station as part of an open area of striking contemporary design (IR 84). She agrees that the refurbishment of the shops and tower, even if financially and commercially viable, would not bring about the transformation of the station frontage and the establishment of a true gateway into the City centre that the Order proposals would provide (IR 90). She agrees that the Order proposals support the Regional Spatial Strategy, the provisions of which include placing emphasis on the role of Liverpool City Centre, conserving the City's distinct architectural heritage as one of the two regional poles, adding modern developments of high design quality and improving the design and management of the public realm (IR 80). She agrees with the Inspector that whilst there may be some validity in the view that regeneration should not always rely on large corporate projects, it is difficult to conceive how such a radical transformation of Lime Street could be reliably brought about in any other way than that proposed by English Partnerships (IR 93). She agrees with the Inspector that a compelling case has been made for the confirmation of the Order (IR 96).
The Secretary of State has carefully considered whether the purposes for which the compulsory purchase order was made sufficiently justifies interfering with the human rights of the landowners and objectors and she is satisfied that such interference is justified since, for the reasons given above, she is satisfied that there is a compelling need in the public interest for the land, the subject of the compulsory purchase order, to be compulsorily acquired. In particular she has considered the provisions of Article 8 of, and Article 1 of the First Protocol to the European Convention on Human Rights. In this respect the Secretary of State is satisfied that in confirming the compulsory purchase order a fair balance has been struck between the use of compulsory purchase powers, the relevant order and the rights of the landowners and objectors…
The Secretary of State has given careful consideration to the Inspector's report and the submissions of the parties. She accepts the Inspector's findings and agrees with his conclusions. She is satisfied that all the land to which the Order relates falls within one or more of the categories referred to in the 1993 Act, being either vacant, underused or ineffectively used. She considers that the scheme proposed would enable the land to be brought back into effective use with the public realm provision creating an attractive and safe environment which could, in turn, encourage the revitalisation of the wider area. She takes the view that the scheme would improve the image of Liverpool City Centre as a regional centre with an appropriate sense of arrival and departure. The Secretary of State has therefore decided to accept the Inspector's recommendation and to confirm the Urban Regeneration Agency (Lime Street Gateway, Liverpool) Compulsory Purchase Order 2005 without modification. This letter constitutes her decision to that effect."
The argument
All sides rely on Pascoe v Secretary of State (Urban Regeneration Agency and Another, Interested Parties) [2006] 4 All ER 1240. In that case the claimant owned and lived in a house on the order land. The inspector was of the view that the evidence established that the order land was predominantly under-used or ineffectively used urban land. The Secretary of State without more confirmed his decision. The claimant's first submission was that for the statutory power under section 159(2)(b) lawfully to be exercised each and every individual piece of land had to be ineffectively or under-used. If in respect of any single piece of land that was not so, an order could not lawfully be made. Forbes J rejected that approach. As he put it in paragraph 34 and following of his judgment:
"[34] Mr Maurici submitted (correctly, in my view) that this would be an unsustainable approach to the construction of the broad urban regeneration powers of which s159(2)(b) forms part. The purpose for which the statutory compulsory purchase power has been granted in the 1933 Act is, as it seems to me, clear namely securing area-wide regeneration. In this case, the regeneration is to be secured through the provision of new housing and commercial properties on a coherent and integrated basis and through the related development and improvements to Edge Lane West. Moreover, I agree that the concept of land being 'under-used' or 'ineffectively used' in s159(2)(b) expressly contemplates that some of the land to be acquired is being used, if it were not then it would be land that was unused and hence would fall within s159(2)(a). Parliament made express provision for a power to acquire land that was unused and land that was under or ineffectively used.
[35] I accept Mr Maurici's submission that, in practical terms, the regeneration of a complete area will often require the regeneration authority to take over the entire area, in order to implement a coherent and effective plan of redevelopment for regeneration. I accept the submission that Parliament cannot plausibly have intended to restrict the powers of the regeneration authority to a piecemeal or patchwork acquisition of individual plots of land in a regeneration area and I reject Mr McCracken's submissions to the contrary effect.
[36] As I have already indicated, the agency sought to rely on s159(2)(b) of the 1993 Act as the basis for making the order. Accordingly, I am satisfied that what the Inspector and the Secretary of State were required to do was to reach a view as to whether the order land, when considered as a unified and coherent whole, fell within the description 'land which is situated in an urban area and which is under-used or ineffectively used'. The agency maintained that certain parts of the order land were also vacant, unused, derelict, neglected and/or unsightly. Those matters were relied on as evidence supporting the agency's principle contention that the order land as a whole was under-used and/or ineffectively used. In my view that was a perfectly sound approach and one that the inspector understood (see IR, para 435). …
[41] In that paragraph the inspector states unequivocally 'It is established that the Order land is predominantly (my emphasis) under-used or ineffectively used urban land.' In my judgment, the inspector made a clear statement in that paragraph as to what he considered had been established by the evidence, namely that the order land was 'predominantly under-used or ineffectively used urban land'. I agree with Mr McCracken that such a finding does not accord with the statutory requirements of s159(2)(b) of the 1993 Act (i.e. the section relied on as empowering the agency to compulsorily acquire the land in question), namely that the land is 'under-used or ineffectively used'.
In my view, it is significant that the inspector has characterised the order land as being 'predominantly under-used or ineffectively used', whilst at the same time acknowledging that it also partly characterised by vacant, unused, derelict, neglected and unsightly land. There is no doubt in my mind that the inspector's expressed conclusion as to the under or ineffectively used state of the order land (considered as a whole) was that it was 'predominantly' so. This expression was not an occasional oversight or a somewhat infelicitous use of language. I am satisfied that the conclusion reached by the inspector on the evidence that he had heard and considered was that when the order land was considered as a whole it was 'predominantly under-used or ineffectively used'. In my view, that finding did not satisfy the requirements of s159(2)(b) of the 1993 Act and I reject Mr Maurici's and Mr Cameron's submissions to the contrary effect.
[43] In para 14 of his decision letter, the Secretary of State accepted the inspector's findings and agreed with his conclusions without any qualification of modification."
Miss Olley, on behalf of the claimants, submits that the land the subject of the order cannot be taken if it does not fall within one or more of the statutory descriptions in section 159(2)(b). It is not enough for the land mostly or predominantly to do so. Pascoe makes that clear. Pascoe cannot be explained by what she describes as the "rogue addition" of the word "predominantly". It is necessary to understand why the insertion of that word was not acceptable. The reason is that section 159(1) requires that before land can be taken it has to be land of one or more descriptions set out in section 159(2). If it is not, it cannot be taken.
Pascoe, submits Miss Olley, cannot be narrowly confined to its facts. Land can only be taken if it all falls within the statutory categories set out in section 159(2)(b). If that were not so, it would not have mattered that the inspector in Pascoe was only able to find that the land fell predominantly within the categories. That requires a finding in respect of each part of the land, including the claimants' shops, as to whether it falls into any of the statutory categories. Had it, the inspector could not have concluded that the land did fall within the definition of section 159(2)(b). At most he could only find it predominantly or mainly did.
Miss Olley emphasises that if some land does not fall within the statutory categories, the scheme would not inevitably founder. Section 162(1) permits an order in respect of land needed for "purposes incidental to" the purpose of achieving the regeneration of land which does fall into the statutory categories.
Further, Miss Olley submits that the references in paragraph 82 of the inspector's report do not support the conclusion that the land was under or ineffectively used. He should have said which parts of the inquiry evidence made a "clear case" of under or ineffective use. It was not enough to refer to paragraphs some of which do no more than recount a party's case.
The fact is, submits Miss Olley, the land was not vacant. The claimants' shops were occupied. That the shops were shabby is irrelevant. They could have been refurbished. It does not amount to ineffective or under-use. Only in paragraph 25 does the inspector record anything about ineffective or under-utilisation of the land, submits Miss Olley. Even then, he only speaks of an "impression of under-utilisation or ineffective utilisation." That is not a finding. Paragraph 42 only speaks of an "impression ... of an area which is neglected and unsightly."
Miss Olley is critical too of the decision letter. The use of the word "dilapidated" in paragraph 5 is not based on the evidence before the inspector. It is irrelevant to section 159(2). The final sentence of paragraph 5 cannot apply to occupied shops.
Miss Olley also raises a discrete reasons challenge. The claimants are entitled to know, she submits, the basis upon which their property is being sought: whether it is because it is vacant and/or under or ineffectively used. Only in that way can they know the basis upon which they can object to the order sought. It reflects the need for EP to state in respect of each part of the land, how it fits within section 159(2). A broad-brush approach is not permissible.
The submissions by Mr Maurici on behalf of the Secretary of State and Miss Patterson QC on behalf of EP can be encapsulated shortly. Their detail becomes apparent in my conclusion. They come to this. The inspector correctly applied the law as set out in Pascoe, albeit that authority postdates the inspector's decision. The inspector considered the evidence. Having regard to it, he was entitled to decide as did. The Secretary of State was entitled to confirm his decision.
My conclusion
It seems to me the following is the case.
First, I agree with Mr Maurici that the fundamental issue before the inspector was whether the order land, when considered as a whole, was under or ineffectively used. I respectfully agree with the reasoning of Forbes J in Pascoe. This is not a case in which the land could be described as vacant, given the presence of the occupied shops. However, vacancy of a part of the land may be evidence of ineffective or under-use. This is a section 159(2)(b) case or nothing, as Mr Maurici accepts.
Second, if all that could be said of the land as a whole was that it was predominantly or mainly under or ineffectively used, that would not be enough. That is not the test.
Third, it seems that EP accurately understood its powers. In paragraph 42 of the report the inspector sets out (as I read it) EP's response to Mr Baig's objection:
"However this submission is based upon a partial reading and misconception of the statutory provisions. The Order Land should be considered as a whole. It is not tenable to argue that the Concourse Tower is anything other than vacant and under-used. While some of the shops are unoccupied, many are not. The whole impression is of an area which is neglected and unsightly. The statutory provisions of s159 of the 1993 are complied with."
Fourth, the inspector accepted that the retail units and the tower had to be considered as a whole: on the basis that this was a single building complex which could not be redeveloped in a divided way. The scheme had to be delivered as a single entity for budgetary reasons. Paragraphs 4, 5, 37 and 39 make that clear. The last three paragraphs were referred to in paragraph 82. It seems to me that on the evidence he heard the inspector was entitled to come to that conclusion. I agree with Mr Maurici in that regard.
Fifth, and it follows, when applying section 159(2)(b) the inspector had to consider whether this building complex was under or ineffectively used. In deciding that, he was obliged to have regard to those parts which were occupied and that part which was not. The part which was not included the empty tower.
Sixth, if, having regard to the building complex as a whole, the inspector was entitled to conclude it was under or ineffectively used, and provided his reasons were adequately set out, his decision cannot not be impugned.
Seventh, the inspector's approach is set out in paragraph 82, where he states that a "clear case can be made from the inquiry evidence that the land and buildings within the Order site are vacant, underused or ineffectively used." Although the land being vacant is not part of the test in section 159(2)(b) (and may be a reference to section 159(2)(a)), that land is vacant is evidence of under or ineffective use, as I have already said. It seems to me the inspector was in the result approaching his task under section 159(2)(b) correctly.
Eighth, given that approach, was the inspector entitled to conclude, that the building complex was under or ineffectively used? Miss Olley submits he was not. Mr Maurici and Miss Patterson QC submit that he was. That too is my view.
By referring in paragraph 82 to other paragraphs it does seem to me, as Mr Maurici submits, the inspector is setting out in shorthand what his findings were. In those references is clear evidence of under or ineffective use of this important site in the city centre. What the evidence found by the inspector comes to is this. The tower is vacant. The majority of the shops are empty. The area is in decline. It has been for some time. The building was poorly maintained before EP acquired the freehold. No enquiries have been made to occupy further shops or the tower (other than temporarily). There has been a lengthy history of poor occupancy and a high turnover of tenants. The appearance is shabby. The quality of accommodation and services to be expected of modern commercial premises in such a key location are not offered by the tower. The environment created by the nature and appearance of the building complex is poor for Lime Street Station. While not sufficient on its own, an impression of neglect and unsightliness is, in my view, some evidence of under or ineffective use. EP's decision not to enter into any new lease agreements may have been a small contributory factor, as the inspector found.
I do not accept that the inspector was bound to conclude that the evidence amounted to no more than predominant or main under or ineffective use. It was a question of fact for him on the evidence he heard having regard to the land as a whole. Moreover, I am not sure it is helpful to subject the findings of the inspector in Pascoe to a close textual analysis; or to analyse his findings in detail and compare them with the present findings. Each case depends on its own facts. The inspector in Pascoe applied the wrong test. So did the Secretary of State. That was a sufficient basis for the judge to decide as he did.
It is not in the circumstances necessary to consider section 162(1).
Ninth, it was in my view sufficient for the inspector to approach the case and express his findings in the way he did. It was not necessary in respect of each part of the land to set out why it fell within section 159(2)(b). He looked at the land as a whole. He applied the test he was required to. On the evidence before him he was entitled to find as he did. He was not required to make a specific finding in respect of each occupied shop. I do not accept Miss Olley's submissions in that regard.
Tenth, it seems to me the inspector adequately set out the reasons for his findings.
The Decision letter
The Secretary of State accepted the inspector's findings. She too refers to the land being vacant (in paragraph 5 of the decision letter). Again, that is apparently a reference to section 159(2)(a). Provided however the Secretary of State considered the land as a whole and, for the purposes of section 159(2)(b), she considered whether it was under or ineffectively used, the reference to parts being vacant does not seem to me to matter. For, as I have said, vacant land (here, a vacant tower and the majority of shop units) is clear evidence of such under or ineffective use. In short, in my view the Secretary of State in the result correctly approached her task as far as section 159(2)(b) was concerned.
That being so, the issue comes to this. Was the Secretary of State entitled to confirm the inspector's decision? In my view she was. The inspector was entitled to find as he did. The Secretary of State was entitled to rely on such a finding.
As to the criticism of the Secretary of State's use of the word "dilapidated", I see nothing in it. This was her description of the totality of the evidence referred to by the inspector.
It follows from what I have said that the claimants' reasons challenge must fail too.
It also follows that the Secretary of State was entitled to come to the conclusion she did regarding the Human Rights claim.
Although I have some sympathy for the claimants, it seems to me this application must fail.
MR BLUNDELL: My Lord, I appear on behalf of the Secretary of State today.
MR JUSTICE GOLDRING: Thank you Mr Banner.
MR BLUNDELL: It is Mr Blundell, in fact my Lord.
MR JUSTICE GOLDRING: I do apologise, I have it the wrong way round. It is my fault.
MR BLUNDELL: My Lord, on that basis we would ask for an order that the claimants' claims be dismissed. We would also ask for an order for the Secretary of State's costs. Your Lordship should have a schedule of those costs that was handed up in advance of the hearing. If not, I have a spare copy here.
MR JUSTICE GOLDRING: I am sure you are right, I confess I have not looked at it.
MR BLUNDELL: Would your Lordship like me to hand up an extra copy?
MR JUSTICE GOLDRING: I would be grateful. I may have inserted it right at the back of the bundle. No, I have not. I would be grateful for another copy. (Handed)
Thank you.
MR BLUNDELL: Your Lordship will see over the page the total costs in the sum of £8,156. I am very helpfully informed by Mr Banner on behalf of the claimants that that sum is not in dispute.
MR JUSTICE GOLDRING: Yes.
Mr Banner, can you take issue with an award of costs in that sum therefore?
MR BANNER: No, I cannot, sir, neither in detail nor in principle.
MR JUSTICE GOLDRING: Thank you Mr Banner. You may have both orders you seek Mr Blundell.
MR BLUNDELL: My Lord, I am grateful.
MR JUSTICE GOLDRING: Thank you.
MR BANNER: My Lord, I do have an application for permission to appeal. I ask for permission on both grounds, my Lord. Firstly, I say that there is a realistic prospect that a different judge might take a different view, largely for the reasons that Miss Olley has set out in her arguments thus far. Secondly, I submit this is a point of public importance. It is only the second challenge to English Partnership's use of its statutory powers under section 162 of the 1993 Act. The issue has not yet been considered at a higher level and therefore it is one which is appropriate for the Court of Appeal.
In any event, my Lord, whether or not permission is given, I do also separately ask for the 21-day time limit for the appellant's notice to run from the delivery of the transcript as opposed to from today.
MR JUSTICE GOLDRING: You may have (subject to any observations Mr Blundell has) the second, namely the extension to 21 days from the delivery of the transcript. Permission to appeal is otherwise refused. Thank you both very much for coming. I am grateful. Thank you again.
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