Tesco Stores Limited, R (on the application of) v Stockport Metropolitan Borough Council

Borough Council, the Defendant, made on 9 November 2022, to grant planning permission to the Interested Party (Lidl) for the erection of a Lidl food store on land at 111 Wellington Road North, Heaton Norris, Stockport SK4 2QH.

Local planning authorities should apply a sequential test to planning applications for main town centre uses which are neither in an existing centre nor in accordance with an up-to-date plan. Main town centre uses should be located in town centres, then in edge of centre locations; and only if suitable sites are not available (or expected to become available within a reasonable period) should out of centre sites be considered.

When considering edge of centre and out of centre proposals, preference should be given to accessible sites which are well connected to the town centre. Applicants and local planning authorities should demonstrate flexibility on issues such as format and scale, so that opportunities to utilise suitable town centre or edge of centre sites are fully explored….

When assessing applications for retail and leisure development outside town centres, which are not in accordance with an up-to-date plan, local planning authorities should require an impact assessment if the development is over a proportionate, locally set floorspace threshold (if there is no locally set threshold, the default threshold is 2,500m2 of gross floorspace). This should include assessment of: a) the impact of the proposal on existing, committed and planned public and private investment in a centre or centres in the catchment area of the proposal; and b) the impact of the proposal on town centre vitality and viability, including local consumer choice and trade in the town centre and the wider retail catchment (as applicable to the scale and nature of the scheme).

Where an application fails to satisfy the sequential test or is likely to have significant adverse impact on one or more of the considerations in paragraph 90, it should be refused.”

considered to be suitable for the proposed retail use, and sequentially preferable. First, Land at Water Street was a site which was proposed for a foodstore by Aldi and was the subject of a planning application. Secondly, there was a vacant unit (Unit 4B) in the Peel Centre which had been identified as being suitable for a similarly sized foodstore.

prepared to “provide the Council with comfort that the proposal will not give rise to any significant adverse impacts on designated retail centres”.

“Having carefully reviewed Rapleys assessment and cumulative

impact, even in the event the Asda store did close, we consider that, on balance, the proposed Lidl store, when considered alongside the foodstore proposals/commitments at the Peel Centre and Water Street, is unlikely to result in a significant adverse impact on the vitality and viability of Stockport Town Centre. In coming to this conclusion, we have had regard to, inter alia: the wider role of the town centre, its vitality and viability, recent and on-going significant investment, and the likelihood of the Asda store site being redeveloped and not lying vacant for a long period of time.”

“Objections on behalf of Tesco on Retail Policy Grounds (July
21)

Our client makes representations of objection to the above application. Our clients trade from an edge-of-centre Extra format superstore on Tiviot Way. This first opened for trade in 2004. The positive retailing function of this store has since been consistently recognised by the Council including through its Local Plan. Our clients also trade from an edge-of-centre store at Burnage Lane which opened in 2005. This store provides a main and local food shopping destination for local residents and underpins the vitality and viability of the adjacent local centre. Our client has invested significantly in creating these important facilities and continues to invest today.

Our client’s objections to the planning application focus on the following considerations:

The misinterpretation of the sequential test particularly with regard to the flexibility to be applied to matters relating to format and scale in the assessment of other opportunities.

The proposed trading concept is acknowledged to lead to additional trips and travel, the effects of which have not been assessed but are likely to result in an unsustainable form of development.

The application has failed to interpret the sequential test correctly. The extent of benefit that can arise from delivering development that can enhance the vitality, viability and health of a town centre has a relationship with the extent to which flexibility has been applied to the scale and format of the operator’s development. Thus, greater flexibility should be applied where achievement of the test’s planning policy objective can be secured. The applicant’s ‘one size fits all’ approach to the application of specific formats is self-serving in the rejection of otherwise suitable sites that could secure positive outcomes for the town centre.

The applicant’s proposed trading concept relies on customers using other shops and stores to complete their food shopping activity. Since the majority of trips are assessed as being diverted from full range stores (see Table 6B at Appendix 3 of the May 2021 Addendum Retail Statement) there will likely be marked increases in the overall number of trips, travel and mileage undertaken for shopping. These effects have not been assessed in the application’s Transport Assessment. They are likely to lead to an unsustainable form of development.

For these reasons, the application should be refused.

Further Objections on behalf of Tesco on Retail Policy Grounds (October 22)

We have particular concerns as to the content of the Officer’s Report in terms of the application of the sequential test.

The sequential test is set out at paragraph 87 of the NPPF which requires that “Main town centre uses should be located in town centres, then in edge of centre locations; and only if suitable sites are not available (or expected to become available within a reasonable period) should out of centre sites be considered.”

Of particular relevance in the determination of this application is the matter of availability and the intended occupier of two sequentially preferable sites, Unit 4B in the Peel Centre and the Water Street site. The Council’s independent retail advisor, Alder King, considered that both of these sites were not available because on the former, “Peel have confirmed to us that they are in legals with another food operator for the unit” and on the latter that “a legally binding agreement has been entered into between Morbaine and Aldi, and therefore, if planning permission is granted, Aldi will occupy the store/site”. These statements are then affirmed within the Analysis section of the Officer’s Report.

The Judgment in Aldergate Properties Ltd v Mansfield District Council considered whether the identity of a retailer was a consideration in relation to ‘availability’. Paragraph 42 of the Judgment confirms that “A town centre site may be owned by a retailer already, to use itself for retailing, who is not going to make it available to another retailer. It is plainly available for retailing, though only to one retailer. That does not mean that another retailer can thus satisfy the sequential test and so go straight to sites outside the town centre. "Available" cannot mean available to a particular retailer but must mean available for the type of retail use for which permission is sought.”

The conclusions therefore made by both Alder King and Officers fail to take into account the position set out in the leading Aldergate Judgment. Neither the Peel Centre nor the Water Street site should be considered to be unavailable because there is an intention that they are to be occupied by a particular retailer. Aldergate is quite clear that, in this situation and for the purposes of the sequential test, these units are available - “Available cannot mean available to a particular retailer but must mean available for the type of retail use for which permission is sought.”

This must be the case bearing in mind the intention of the sequential test is to secure retail (and other main town centre uses) in town centres, then on edge of centre site and only then in out of centre locations. The most sequentially preferable site must be developed first. In order to therefore satisfy this policy requirement, availability should be considered only in relation to whether it is available for the type of retail use sought (as set out in Aldergate). As such both the Peel Centre (due to the change of use permission) and the Water Street site are available and are sequentially preferable to the Lidl application site.

The sequential test has therefore been failed. That conflicts with saved UDP Policy TCG3 and permission should be refused. Indeed, paragraph 91 of the NPPF explains that this should be the case.

In these circumstances, could you confirm the appropriateness of the recommendation in your Report being amended to reflect this important breach of policy.

However, if officers are unwilling to take such a step, we read the relevant terms of decision making delegated to the Area Committee as not allowing them to grant or resolve to grant permission for applications that are departures from the development plan. The matter would therefore need to be reported to the Planning and Highways Regulation Committee.

“Sequential Approach

The applicants define the catchment area for the proposed discount store as commensurate with a 5 minute drive-time. The reasoning for this approach is agreed and it is considered that the catchment appears broadly reasonable and consistent with catchment areas often adopted for deep discounters in larger town/cities. This catchment includes the following centres: Stockport Town Centre; Reddish Houldsworth Square District Centre; Heaton Chapel Local Centre; Shaw Road/ Heaton Moor Road Local Centre; and Moor Top (Heaton Moor) Local Centre

Having reviewed the submission and findings of the Planning and Retail Statement, it is accepted that there are no sites or units that would be physically capable of accommodating the proposed foodstore (taking into account reasonable flexibility) in Houldsworth District Centre or the other 3 local centres. In relation to the Town Centre, the following sites have been

assessed under the sequential approach analysis… Officers agree with this list and are aware of no other sites which require assessment under the sequential test. The position on sequential assessment has been an evolving one over time since the application was submitted. The up to date position as regards to each of the sites above will now be considered below: …

Unit 4B, The Peel Centre

The owners of the retail park, Peel, have obtained planning permission for the change of use of the unit from non-food retail to flexible class E use (LPA ref: DC/081762). At the time of writing, it is understood that Next are in the process of closing down the store with store closure expected later in Summer 2022. The applicant's submission advises that they have been advised by the agent representing the owner, that they are currently in legals with a retail operator to occupy Unit 4b with the "deal" moving forward and set to conclude by the end of August. The applicants note that both parties have instructed solicitors, representing a commitment to moving the deal forward and significant costs will have been incurred by both sides and it is likely that heads of terms for a deal will have been agreed between the two parties in advance of this process. The Council's retail planning advisor has subsequently discussed Unit 4B with Peel to verify the applicant's statement. The site owners have confirmed to us that they are in legals with another food operator for the unit. Accordingly, it is agreed that the unit is not available/available within a reasonable period for the proposed development.

Land at Water Street Site

A planning application has been submitted by the landowners, Morbaine, for a discount foodstore scheme on this site. Aldi has confirmed in a letter dated 25th November that they have "reached a deal in principle with Morbaine for the occupation of the proposed foodstore and has entered into a legally binding agreement to this effect". Aldi state that they would relocate from their existing store on Newbridge Lane. Given that an agreement at an advanced stage has been entered into between Morbaine and Aldi, and therefore, if planning permission is granted, Aldi will occupy the store/site, it is concluded that the site can no longer be considered to be available/available within a reason period for the proposed development.

Sequential Approach Conclusions

In response to the objections received from Tesco on the 3rd October 2022, the outlined Aldergate Properties Judgment has been reviewed at length and the following comments can be made. As discussed above, it has been concluded following the

receipt of appropriate evidence that neither the Water Street site or Unit 4b at the Peel Centre are available for the retail development proposed under this application. This is because these sites have been committed to other retailers and therefore, there is no access to these sites by the applicant or any other parties. It is considered therefore, that this position is not comparable to the situation in paragraph 42 of the Aldergate judgment where a site was available to be taken up, albeit by one retailer. The alternative sites in this application have been taken up and are not 'available'. What is considered to be very important in this case is that the issue here is availability, not use. The Aldergate judgment clearly states that the identity of the applicant is not relevant to the scope of the sequential test and the issue is whether other, sequentially preferable, sites are available for the type of retail use proposed. In this case, as Unit 4B and Water Street have been taken up by other operators, then they are not "available for the type of retail use for which permission is sought." They are not available to Lidl in this case or in fact to anyone else.

Therefore, it is considered that the Council would be entitled to conclude that the sequential test has been passed, that policy TCG3 has not thereby been breached and that the proposals are not departures from the Development Plan. The main issue in the Aldergate case was whether the identity of the applicant is relevant to the scope of the sequential testing. It is concluded that nothing in this application turns on the identity of the applicant and the sequential testing has not been affected by their identity. On the basis of all the above information, officers remain satisfied that the applicant has demonstrated that the proposed development is in accordance with the sequential approach retail policy test. Therefore, for these reasons, it can be concluded that the proposals do not constitute a departure from the development plan as the necessary tests have been met.”

The Planning Court—and this court too—must always be vigilant against excessive legalism infecting the planning system. A planning decision is not akin to an adjudication made by a court: see para 50 of my judgment in the East Staffordshire case. The courts must keep in mind that the function of planning decision-making has been assigned by Parliament, not to judges, but—at local level—to elected councillors with the benefit of advice given to them by planning officers, most of whom are professional planners, and—on appeal—to the Secretary of State and his inspectors. They should remember too that the making of planning policy is not an end in itself, but a means to achieving reasonably predictable decision-making, consistent with the aims of the policy-maker. Though the interpretation of planning policy is, ultimately, a matter for the court, planning policies do not normally require intricate discussion of their meaning.”

“One thing, however, is certain, and ought to be stressed.

Planning officers and inspectors are entitled to expect that both national and local planning policy is as simply and clearly stated as it can be, and also—however well or badly a policy is expressed—that the court's interpretation of it will be straightforward, without undue or elaborate exposition. Equally, they are entitled to expect—in every case—good sense and fairness in the court's review of a planning decision, not the hypercritical approach the court is often urged to adopt.”

“Where the line is drawn between an officer's advice that is significantly or seriously misleading—misleading in a material

way—and advice that is misleading but not significantly so will always depend on the context and circumstances in which the advice was given, and on the possible consequences of it. There will be cases in which a planning officer has inadvertently led a committee astray by making some significant error of fact (see, for example R (Loader) v Rother District Council [2017] JPL 25 ), or has plainly misdirected the members as to the meaning of a relevant policy: see, for example, R (Watermead Parish Council) v Aylesbury Vale District Council [2018] PTSR 43 . There will be others where the officer has simply failed to deal with a matter on which the committee ought to receive explicit advice if the local planning authority is to be seen to have performed its decision-making duties in accordance with the law: see, for example, R (Williams) v Powys County Council [2018] 1 WLR 439 . But unless there is some distinct and material defect in the officer's advice, the court will not interfere.”

The development plan is a carefully drafted and considered statement of policy, published in order to inform the public of the approach which will be followed by planning authorities in decision-making unless there is good reason to depart from it. It is intended to guide the behaviour of developers and planning authorities. As in other areas of administrative law, the policies which it sets out are designed to secure consistency and direction in the exercise of discretionary powers, while allowing a measure of flexibility to be retained. Those considerations point away from the view that the meaning of the plan is in principle a matter which each planning authority is entitled to determine from time to time as it pleases, within the limits of rationality. On the contrary, these considerations suggest that in principle, in this area of public administration as in others … policy statements should be interpreted objectively in accordance with the language used, read as always in its proper context.”

‘suitability’ in the application of the test. This was because, the claimant in Aldergate was aggrieved, in part, by the council’s decision to grant planning permission to a competitor (Aldi) for an out of centre retail proposal on the grounds that the sequential test has been passed.

“Before turning to the submissions, I need to set out parts of the decision of the Supreme Court in Tesco Store Limited v Dundee City Council [2012] UKSC 13, [2012] 2 P&CR 9, because the District Council’s understanding of it was critical to its approach. Tesco challenged the grant of planning permission for a supermarket on a large industrial estate out of centre. The City Council had had to consider whether such a store met criteria in the Development Plan, the first of which was that “no suitable site is available in the first instance within and thereafter on the edge of city, town or district centres”. The City Council had interpreted “suitable” as meaning “suitable for the development proposed by the applicant”. Tesco contended that it meant “suitable for meeting the identified deficiencies in retail provision in the area”. The question of what “suitable” meant was a question for the Court, although its application was a matter of planning judgment. In addition to the Development Plan itself, the Plan incorporated Scottish Planning Policy Guidance, which was replaced in generally similar terms by other Scottish planning policy statements. Although the policy documents at issue in that case have some similarities in wording and certainly in purpose to that in the NPPF, the Court was not considering English planning policy documents.”

I have no doubt but that Mr Kolinsky’s [counsel for the claimant] essential argument is correct, for a variety of reasons. In my judgment, “suitable” and “available” generally mean “suitable” and “available” for the broad type of development which is proposed in the application by approximate size, type, and range of goods. This incorporates the requirement for flexibility in [24] NPPF, and excludes, generally, the identity and personal or corporate attitudes of an individual retailer. The area and sites covered by the sequential test search should not vary from applicant to applicant according to their identity, but from application to application based on their content. Nothing in Tesco v Dundee City Council, properly understood, holds that the application of the sequential test depends on the individual corporate personality of the applicant or intended operator

I shall approach this first by construing the NPPF, without considering Tesco v Dundee City Council because the language of the Scottish policies is to some extent different, and it did not consider the language of the English policies relevant to this case. First, although the language of “suitable” and “available” features in both the plan-making policy in [23] NPPF and in the development control policy in [24] NPPF, it is inevitable that their focus will be different at the two stages. But there is a sensible relationship between them; they are not to be read simply in isolation from each other. The plan-making policies plainly do focus on allocating sites to meet retail needs, as a town centre use; but policies and site allocations have to be sound and their effectiveness depends on their commercial realism. That approach properly involves planning for development to go to commercially realistic allocated sites where a particular type of development is seen as publicly beneficial, and discouragement, to the point of refusal, for such development elsewhere. The development control policy in [24] NPPF deals with applications for town centres uses out of centre where there is no up to date Development Plan embodying the policies of [23] NPPF. But the development control policy aims to achieve as much of what an up to date plan would achieve as possible. It is not intended that the absence of an up to date plan creates a rather different world in which retailers could enjoy a much greater degree of temporary freedom based on their individual commercial interests.

Second, and related, NPPF [24] positively “requires” retail investment in the first place to locate in town centres rather than elsewhere. Its thrust is rather more emphatic than policies which advise developers and retailers to have regard to the circumstances of town centres, as in Tesco v Dundee [28]. It is the purpose of the planning system to control development, that is to permit, prevent, encourage, inhibit or limit and condition it, so that the individual private or commercial interest and the

broader public interest meet in reconciliation however uneasily. NPPF [24] cannot therefore be interpreted as requiring “suitability” and “availability” simply to be judged from the retailer’s or developer’s perspective, with a degree of flexibility from the retailer, and responsiveness from the authority.

Third, and of critical importance here, still less can it be interpreted as envisaging that the requirement or preferences of an individual retailer’s trading style, commercial attitudes, site preferences, competitive preferences whether against itself or greater competition should dictate what sites are “suitable” or “available” subject only to a degree of flexibility. NPPF [23] and [24] are simply not couched in terms of an individual retailer’s corporate requirements or limitations. That would be the antithesis of planning for land uses and here, its default policies. It would take very clear language for such an odd result to be achieved.

Any alternative approach would reduce the sequential test to one of the individual operator’s preference, with the suitability of centres, sites and their availability varying from applicant to applicant each proposing the same broad type or even identical form of development. This case illustrates just why on the proper interpretation of NPPF [24], the identity of the applicant or proposed occupier is generally irrelevant. Even if the applicant had been Aldi, or if the application had been for a store to be occupied by Aldi, with an occupancy condition envisaged from the outset, the town centre would have been wrongly excluded from the search area on the basis of Aldi’s particular corporate, commercial position or style. Any other approach would make nonsense of the sequential test to the advantage of an operator well-represented in the area, or one reluctant to compete with certain other retailers, however sensible that reluctance might be commercially. The applicant may not be a retailer; it may or may not have an operator identified, or one may be signed up or interested but the identity of which it is not yet willing to disclose. It would have to go through the full sequential test, and then obtain its retailer; but were the application made with retailer in tow, the test would be different. And were a retailer later signed up, it could require a different sequential test for the same application or a repeated application for the same development at the same site. That is not the intention of NPPF [24] or any sensible application of the sequential test.”.

Fourth, there is a further reason why the identity of the applicant, as opposed to the sort of development it proposes, is not generally relevant to the sequential test. The sequential test in the NPPF is not just one of suitability; it covers availability:

“only if suitable sites are not available, should out of centre sites be considered.” A town centre site may be owned by a retailer already, to use itself for retailing, who is not going to make it available to another retailer. It is plainly available for retailing, though only to one retailer. That does not mean that another retailer can thus satisfy the sequential test and so go straight to sites outside the town centre. “Available” cannot mean available to a particular retailer but must mean available for the type of retail use for which permission is sought”

provides:

“100D.– Inspection of background papers.

(1)

Subject, in the case of section 100C(1) , to subsection (2) below [a time limit], if and so long as copies of the whole or part of a report for a meeting of a principal council are required by section 100B(1) or 100C(1) above to be open to inspection by members of the public–

(a)

those copies shall each include a copy of a list, compiled by the proper officer, of the background papers for the report or the part of the report, and

(b)

at least one copy of each of the documents included in that list shall also be open to inspection at the offices of the council. …

(3)

Where a copy of any of the background papers for a report is required by subsection (1) above to be open to inspection by members of the public, the copy shall be taken for the purposes of this Part to be so open if arrangements exist for its production to members of the public as soon as is reasonably practicable after the making of a request to inspect the copy. …

(5)

For the purposes of this section the background papers for a report are those documents relating to the subject matter of the report which— (a) disclose any facts or matters on which, in the opinion of the proper officer, the report or an important part of the report is based, and (b) have, in his opinion, been relied on to a material extent in preparing the report, but do not include any published works.”

advisor to the local planning authority on compliance with a sequential test. Lieven J held:

“58.

The clear statutory intention behind s.100D(5) of the LGA 1972 is to ensure that documents upon which the OR is based are open to be viewed by members of the public. It is in my view absolutely obvious that the OR is partly based on Ms Atkinson's advice, indeed I fail to see how it could not have been. Ms Atkinson's role was precisely to advise the Council on the issue of compliance with the Plan, and Mr Henry simply relied on that advice when writing the report. The fact that the advice was in part opinion does not remove it from the scope of s.100D(5) , indeed quite the contrary, advice will often be the very thing upon which the OR is based. … 60. Further, proper compliance with s.100D is an important part of maintaining a transparent planning system, in which third parties can be properly informed as to why particular recommendations are being made. The failure to produce the advice from the Council's advisor was an obvious breach of this requirement.”

“Plainly, it is unnecessary for a request to see a document to have been made for a breach of s.100D(1)(b) to have occurred. On the other hand, when it comes to material prejudice, a person who was aware of a reference in a committee report to a background paper but who has never shown or had any interest in inspecting the document is unlikely to get very far in a claim for judicial review”

“The true focus of interpretative debate is still the wording of the policy in context, and here of the English policies. Policy interpretations arising from litigation may be context and argument specific, and not intended as substitutes for the text at issue for all cases and contexts. The good sense of the planning consequences of any given interpretation may be a guide to its correctness.”

proposed store to attract some 145,000 residents ² given the location of similar competing facilities, and some larger facilities, within the catchment area. The assessment as to an appropriate catchment area is a matter of planning judgment. In this case the Council accepted the rationale put forward by Rapleys, and further accepted that a catchment based on a 5-minute drive time was the most appropriate for the sequential test. The OR explained that the suggested catchment area was broadly consistent with the catchment areas often adopted for deep discounters in larger towns and that it had been agreed by the Council’s own retail consultants. The conclusion on catchment area is completely rational and supported by reasoning.

site when assessing retail impact but to treat it as outside the same catchment when applying the sequential test.

failing to make available for inspection the expert advice it received on retail planning matters from its own consultant. On the 1 July 2021 the Claimant’s planning agents wrote to the Defendant requesting the retail advice from Tetra Tech and Alder King. The Defendant refused to disclose the documents prior
to the committee meeting. Those reports are clearly background papers within the meaning of s100D(5).