Residents’ parking permits banned by 106

My retired colleague David Brock recently posted an item in his blog drawing attention to two High Court decisions which confirm that a covenant in a section 106 agreement (or unilateral planning obligation under that section) that seeks to prevent residents from applying to the council for a parking permit in a CPZ is unlawful, because such a restriction is not within the scope of section 106.

The recent case to which David’s blog post refers is R (Khodari) v. Kensington and Chelsea RLBC [2015] EWHC 4084, in which judgment was given on 18 November 2015. David reminds his readers that this is nothing new. The point was decided as long ago as March 2013, in Westminster City Council v. SSCLG [2013] EWHC 690 (Admin), on which David had also commented in his blog at that time.

In the earlier case, it had been the LPA that was challenging the grant of planning permission on appeal, where the planning inspector had taken into account a planning obligation proffered by the appellant, in which they undertook “not to apply to the Council for a Parking Permit in respect of the Land nor to knowingly permit any owner or occupier of the Land to apply to the Council for a Parking Permit and if such a permit is issued in respect of the Land it shall be surrendered to the Council within 7 days of written demand”. The illegality of the obligation led to the quashing of the appeal decision.

In the recent case involving Kensington & Chelsea, it was a third party objector who successfully challenged a grant of planning permission by the LPA. The council had granted permission for development of a neighbouring property on the basis of a section 106 agreement which contained a covenant in exactly the same terms as those in issue in the earlier Westminster case, except that the obligation required this term to be written into the leases of the new dwellings as cross-covenants on the part of both the lessor and the lessees. Given the judge’s findings in respect of the invalidity of the section 106 agreement, it followed that the planning permission had to be quashed.

The legal consequences of an unlawful planning obligation (such as those in both the cases cited above) can be markedly different, depending on the circumstances. Clearly a planning permission granted by an LPA or by a planning inspector on appeal is vulnerable to challenge in the High Court (and the same would apply to a prior approval under Part 3 of the Second Schedule to the GPDO) if it was dependent on an unlawful planning obligation, but in all these cases there is a six-week time limit for launching such a challenge. Time can be extended in exceptional circumstances, but only for a short period in most cases.

Absent a timeous legal challenge, however, the planning permission or prior approval will stand, but the unlawful section 106 agreement will be unenforceable. Thus, whilst it would be inadvisable for a developer to offer or agree to a planning obligation that seeks to prevent applications for residents’ parking permits, because of the risk of the permission being quashed if challenged in the High Court, where there is an unlawful 106 but there has been no High Court challenge to the planning permission, there would appear to be nothing to prevent residents applying for parking permits, notwithstanding the purported prohibition in the section 106 agreement. (It should be borne in mind, however, that the lease term that was to be entered into in the Kensington & Chelsea case might have proved more difficult to break.)

© MARTIN H GOODALL