Friday, 11 February 2011

Concealed development - the hidden trap in the Localism Bill


I don’t usually quote verbatim from press releases, but the Law Society has recently published an important statement with which I concur so strongly that I think it worth repeating here.

In this blog on 21 December I drew attention to Clause 104 of the Localism Bill, which seeks to deal with ‘concealed development’. I pointed out the potentially wide-ranging effect of this change, which could have serious unforeseen and unintended consequences.

The Law Society is quite rightly warning that this clause could bring uncertainty and chaos to the property market. As you will recall from my earlier posting on this topic, the clause would allow local planning authorities to seek a ‘planning enforcement order’ at any time after it becomes aware that there has been a breach of planning control which it alleges has been ‘concealed’. This will then enable it to issue an enforcement notice, even if the normal 4-year or 10-year time limit has long since expired.

Law Society President Linda Lee points out that the new regime could create uncertainty for the buyers of both residential and commercial property when they cannot establish whether previous owners have concealed a breach of planning control, with the result that they themselves could become liable to enforcement action for that breach at any point in the future. If the buyer discovers a concealed breach and then fails to report it, they will be concealing it themselves.

She points out that this proposed change could have a serious effect on both the residential and commercial property markets, where innocent purchasers could become liable for the actions of a previous owner. This could lead to purchasers demanding that every breach of planning control is remedied or that the price is abated for the risk. It could also delay transactions while enquiries are being made about the planning status of a property. It increases the level of due diligence buyers would need to do, as there will no longer be a cut-off date. This could involve buyers incurring considerable expense. It could even necessitate taking out insurance against any unknown potential liability.

While aimed at the fraudulent and blatant cheats, the provisions are drawn so widely that they will catch anything which has not been expressly pointed out to the planning authority. The new provision is unnecessary – the two cases which have led to these proposals are highly unusual and bizarre. [This is a reference to the Welwyn-Hatfield and Fidler cases, which have been the subject of previous posts on this blog, and both of which are still before the courts].

I fully endorse what the President of the Law Society has said. I hope that common sense will prevail and that ministers will withdraw this clause. They may be tempted to have a go at drafting something less draconian in its effect, but as Linda Lee has pointed out, it is in any event a sledge-hammer to crack a nut, and the government is over-reacting to the two cases mentioned above.

© MARTIN H GOODALL

6 comments:

Martin H Goodall LARTPI said...

The comments facility is slightly inflexible in the way it works, so I am relaying here a comment received from barrister Scott Stemp, who recently wrote a short piece on concealed development in his own planning law blog, suggesting that perhaps the Fraud Act might be exploited as a means of stopping this sort of development in its tracks.

Scott’s blog can be found at http://planningblog.org . [Sorry, this is not a link, but you can copy and paste the URL as explained earlier.] Scott went on to refer to Clause 104 in the Localism Act, which prompted me to draw his attention to the views expressed by the President of the Law Society, as reported in the post above.

In Scott’s response he writes : “I agree with you and the Law Society - these proposed amendments seem to me to be misconceived and disproportionate to the degree of mischief sought to be addressed. Attempting to catch deceptive behaviour but actually catching even inadvertent mistakes (by omitting reference to words such as "deception" or "dishonest") and leaving the final say to the discretion of the Magistrates' Court doesn't inspire much faith in the idea of certainty, especially where you might be considering enforcement against someone's dwelling or livelihood.”

Absolutely. Clause 104 either needs to be withdrawn in its entirety or drastically re-drafted.

Martin H Goodall LARTPI said...

[For 'Localism Act' read 'Localism Bill'. It won't be an Act for some time yet!]

Anonymous said...

Martin - it's helpful to see that others have spotted this problem independently of the Law Society, and als that the Law Society's concerns are being picked up.

To keep you and your readers up to date, The Planning & Environment Committee of the Law Society has suggested a number of amendments to clause 104. We hope that members of either House will pick them up.

David Brock, Chair, Law Society's Planning & Environmental Law Committee, partner, Mills & Reeve LLP

Adam Coombs said...

Martin,

Now that the Localism Bill is finalisation, can you direct me to the finished worked of Clause 109? I would be very interested to know where they landed on that.

Many thanks

Adam
Quod

Martin H Goodall LARTPI said...

The last time I looked at the full text of the Bill, what had been Clause 109 had become Clauses 124 an 125. I am not sure if further amendments elsewhere in the Bill, now approved by both Houses, will have led to a further re-numbering of these clauses. Royal Assent is expected any day now, and we shall then be able to see the Act in its final form.

I propose to examine the ‘concealed development’ sections in the Act (amending the 1990 Act) in a future post. The practical application of these new provisions will not be easy, and is likely to become a lawyers’ feast!

Martin H Goodall LARTPI said...

Further to my note of 14 November, I can confirm that the 'concealed development' provisions now form sections 124 and 125 of the Act.

These sections are not yet in force, and it will depend on De-CLoG as to how soon a commencement order can be expected bringing these two sections (and s.123 relating to retrospective planning applications)into force.