Amalgamation of dwellinghouses again

Readers are no doubt aware of the High Court judgments in Richmond-upon-Thames LBC v SSETR [2001] J.P.L. 84 and R (Kensington and Chelsea RBC) v SSCLG [2016] EWHC 1785 (Admin), on which I have commented both in this blog and in my recently published book, The Essential Guide to the Use of Land and Buildings under the Planning Acts, but these rulings continue to cause difficulties in practice.

Notwithstanding the binding nature of these two judicial authorities, which have since been followed by inspectors in a number of planning appeals, I have serious reservations regarding these two judgments. A property owner should be able (with professional advice, if necessary) to know whether a particular adaptation or change to a property is or is not development within the definition in section 55, without having to carry out research to establish whether there is an underlying housing shortage in the area in question which might make the loss of housing units through amalgamation a material planning consideration that may affect the lawfulness of this amalgamation (even where there is no relevant Development Plan policy that addresses this issue).

In light of these two judgments, owners and developers are now faced with a situation in which the amalgamation of two or more dwellings in some LPA areas is not a material change of use for the purposes of section 55, because there is no underlying housing shortage in the area in question which might make the loss of housing units through amalgamation a material planning consideration, whereas in others (notably in various London boroughs), the very same change could be a material change of use, if the Richmond and Kensington & Chelsea cases are followed.

The practical difficulties that could arise in these circumstances were illustrated by two further cases, Royal Borough of Kensington & Chelsea v SSCLG and Noell [2017] EWHC 1703 (Admin) and Royal Borough of Kensington & Chelsea v SSCLG and Larham [2017] EWHC 1704 (Admin). Both were concerned with appeals against the refusal of planning permission (rather than LDC appeals) relating to proposals for the amalgamation of four and two flats respectively to form a single large dwelling in each case. The Inspector determined that the loss of residential units was acceptable, based on his calculation of housing requirements in the borough, and so he allowed both appeals. The LPA challenged those appeal decisions on the basis that the Inspector was mistaken in his calculation of the housing land supply, and both appeal decisions were quashed on this ground. Whilst these appeals turned on planning considerations of a type that is common in section 78 appeals, it is clear that similar disputes could easily arise in LDC appeals, in light of the earlier judgments in Richmond and in the 2016 Kensington and Chelsea case. These latest judgments demonstrate the uncertainty faced by property owners and developers in face of the variable planning judgements that might influence a decision as to whether the amalgamation of particular dwellings is or is not lawful by reference to section 55(2)(f).

What is needed is certainty in the law. Section 55(3)(a) makes it absolutely clear that the use as two or more dwellinghouses of any building previously used as a single dwellinghouse involves a material change of use of the building and of each part of it which is so used. It would be an easy matter for a similar sub-clause to be added to section 55(3) declaring with equal clarity that the use as a single dwellinghouse of any building [which by definition includes a part of a building] previously used as two or more dwellinghouses involves a material change of use of the building and of each part of it which is so used.

As I have explained before, but it bears repeating, my objection to the current position in light of the Richmond and Kensington judgments is solely to the legal uncertainty that has arisen as a result of these two High Court decisions. So far as I am concerned, there could be no objection in principle to the proposition that the use as a single dwellinghouse of any building previously used as two or more separate dwellings should be treated as a material change in the use of the building; but any such change in the law should take the form of an amendment to the 1990 Act, rather than depending on the less than certain intervention of the courts. Parliament passed the Town and Country Planning Act 1990, including section 55 in its current form, and if it is felt that the loss of residential units through amalgamation is a problem (particularly in some London boroughs), then it is Parliament who should amend the Act to resolve this issue.

© MARTIN H GOODALL

A BRIGHT FUTURE

Some readers of this blog may still have the fond illusion that I am a one-man band, ploughing my lonely furrow somewhere out there in the sticks, but that would be a long way from the truth. I am very proud that I have now been a member of KEYSTONE LAW’s planning law team for more than 8 years, and I look forward to being associated with this very successful and dynamic firm for a good few years to come. I have explained on several occasions that this blog is not (and was never intended to be) a marketing tool, but I can’t resist blowing a toot on my trumpet occasionally for the best law firm in which I have ever worked, in what is now a very long career.

Some of you may not be aware how large and successful a firm KEYSTONE LAW is. Our six-strong planning law team is part of the firm’s property law group, which contains over 70 lawyers. Overall, the firm now has more than 250 lawyers (mainly solicitors, but also some barristers, including two in our planning law team) practising throughout England & Wales (with office hubs in London, Bristol, Leeds and Newcastle), as well as Northern Ireland, the Isle of Man and Guernsey. The firm’s associated Australian practice, Keypoint Law, has offices in Sydney, Melbourne and Canberra.

After winning numerous industry awards, KEYSTONE LAW has entered The Lawyer Top 100 law firms this year, with reported annual revenue of more than £25 million. The firm became an ‘ABS’ in 2013, enabling private equity firm Root Capital to invest over £3 million in the firm in 2014, following which the practice has subsequently achieved annual revenue growth of more than 20%.

Now the firm is set to become a listed company, with an initial public offering which should raise around £15 million on a projected placing price of 160p. This puts the total capital value of KEYSTONE LAW at around £50 million. The shares will commence trading on Monday, 27 November. KEYSTONE LAW has a very strong central management team, who will remain very firmly in the saddle. James Knight, founder and Managing Director of the firm will become Chief Executive of the listed plc.

I see that some nay-sayers commenting in the Law Society’s Gazette have muttered darkly about law firms burdening themselves with debt, but city commentators point out that the financial restructuring enabled by this flotation is expected to result in the listed company being debt-free following completion of this re-capitalisation.

Unlike some large law firms one hears about, KEYSTONE LAW is a very happy ship, not least because the firm’s lawyers reap a very fair reward as a proportion of the costs they generate. There is a real ‘family’ feeling within the firm, and a refreshing absence of office politics. And the superb admin back-up from which we all benefit allows Keystone lawyers to get on with what we really enjoy, and do best - practising the law.

© MARTIN H GOODALL

Prior approval applications under Class Q(a) only

My attention has been drawn to an appeal decision in East Staffordshire [3170228], issued on 3 July 2017, which allowed a prior approval appeal under Class Q(a) only (for the residential conversion of an agricultural building), where it was clear that works under Class Q(b) would also be required. The view was expressed in that decision letter that an application under Class Q(b) could be made at a later date.

The Inspector wrote:

6. The Council’s reason for refusal and evidence focuses on those matters addressed under Class Q(b) in terms of the scale and nature of the works that would be required to convert the building to residential use. However, Class Q.2(2) of the GPDO indicates that an application can be made for the change of use of the building and curtilage only. It is clear from the appellant’s application form and supporting evidence that the application which constitutes this appeal was made on this basis. The appellant has also made it clear that it was always the intention to address matters under Class Q(b) with a separate application.

7. It is evident from the current condition of the building that a further application would be required. However, the GPDO does not state that where building operations are clearly intended or required that a Class Q(a) only application cannot be made. The approach of applying for Class Q(a) only is permissible under the regulations of the GPDO and the appellant can seek approval for the change of use without dealing with building operations. I have therefore considered the appeal on this basis.

I am led to believe that there may have been one or two other appeal decisions to the same effect, but the decision letters I have seen so far do not seem to be on precisely the same point, and so at the time of writing I have only the East Staffs (Uttoxeter) decision to go on.

It has been pointed out to me that my summary of the provisions of Class Q (and of paragraph W) in my first book, A Practical Guide to Permitted Changes of Use (on page 110 in the Second Edition), does not accord with this approach on the part of this inspector (and possibly others?). Nevertheless, having reviewed the legislation, I maintain my stated view on this issue.

The reason for this is that paragraph W.(2)(a) provides in clear terms that the application must be accompanied by a written description of the proposed development, which, in relation to development proposed under Class C, M, N or Q of Part 3 must include any building or other operations. So it is only in relation to those developments where no building operations will in practice be required that a prior approval application may be made under Class Q(a) alone. In light of the wording of paragraph W(2)(a), I really don’t think there can be any scope for making an application solely under Class Q(a) in a case where building operations under Class Q(b) will also be required in order to convert the building for residential use, and an LPA would be fully justified in rejecting a prior approval application made under Class Q(a) alone as invalid in these circumstances (by reference to paragraph W(2)).

If any readers can provide other examples of this Q(a)/Q(b) issue having been considered in other appeals, I would be grateful to have them drawn to my attention, particularly if they contain any explanation or justification for departing from the provision I have quoted from paragraph W(2)(a).

In the meantime, I should record my gratitude to a correspondent for drawing my attention to the East Staffordshire decision, together with other recent appeal decisions on Class Q. I have not named my source, as I have not ascertained whether they would be willing to ‘go public’ in this instance.

UPDATE (22 November): I am grateful to another correspondent for drawing to my attention an appeal decision in North Devon [3146607], issued on 16 July 2016. In his decision letter, the Inspector wrote:

8. Class Q.2 of the GPDO sets out that an application can only be made for: both the change of use and the conversion works; or the change of use only. The application that constitutes this appeal was made for the latter and I am to deal with the appeal on this basis as the GPDO does not state that where building operations are clearly intended that a Class Q(a) only application cannot be made. Therefore, applicants can seek prior approval for the change of use in advance of dealing with the building operations.

I can see why some people (including some inspectors) read the conditions in paragraph Q.2 as if they allow an application to be made under Q(a) alone, even where building operations will be required under Class Q(b). If one goes back to look at the former Class MB in the 2014 amendment order, one finds the same wording, but two inconsistent appeal decisions in Cornwall (one of which asserted that, where building operations would be required, a Class MB(a) application could not be made without a simultaneous application under Class MB(b), and the other accepted that it could) led the government to add the provision in paragraph W(2)(a) in the 2015 Order to which I have drawn attention, which had not previously appeared in paragraph N of the 1995 Order.

Paragraph W(2)(a) was clearly added in the 2015 Order so as to resolve the doubt arising from the wording in Class MB that had led to the two inconsistent decisions on this issue in Cornwall. In the two more recent appeal decisions to which attention has now been drawn [3170228 and 3146607], the Inspectors have both concentrated on the wording of the conditions in paragraph Q.2 regarding prior approval applications, without having paid any attention to paragraph W(2)(a).

I really think that PINS should amend their advice to Inspectors in order to draw attention to paragraph W(2)(a), but if it is the case that PINS are in fact advising inspectors that Class Q(a) applications can be dealt with without an application also being made under Class Q(b) (where building operations will clearly be required in order to convert the building for residential use) then someone in DeCLoG needs to put them right on this, and explain why it was that paragraph W(2)(a) was added to the 2015 GPDO.

© MARTIN H GOODALL

Another successful book launch

Photo © Kelly Duncan (Keystone Law)

Like my first book, my new book, “The Essential Guide to the Use of land and Buildings under the Planning Acts” has outsold the original print order and the first reprint, so that we had temporarily run out of copies by the time of our launch seminar in London last Friday. However, anyone who is still awaiting their copy of the book should get it very soon. The book is now on its third printing, and is continuing to sell well. I have had very positive feedback from readers, one or two of whom told me that the book had proved useful to them within days after they received their copy!

The launch seminar that Bath Publishing held at the RIBA in London on 17 November, in association with Keystone Law, was also a great success, with another large audience (but as is so typical of the English, seats were left vacant at the front, while everyone crowded into the seats further back in the hall! – see photo).

I spoke on Lawful Uses (and LDCs), while William Upton of 6 Pump Court gave an extremely interesting talk on Unlawful Uses (including enforcement). My colleague, Ben Garbett then explained a number of judgments handed down in the past year affecting permitted changes of use, and we had two very lively Q&A sessions, which led to an interesting discussion of a number of controversial issues in these areas of planning law.

Clearly there are continuing queries relating to Class Q (residential conversion of agricultural buildings), notably in relation to structural issues. Hopefully, there will be some further clarification, either from the government or from the courts in the not too distant future. I shall certainly cover any developments on this topic in this blog.

Another area of doubt is the precise way in which the time limits under Class P (residential conversion of a warehouse or other storage building) and Class PA (residential conversion of a light industrial building) will work in practice. The deadline for completing conversions under Class P – 15 April 2018 - is fast approaching.

© MARTIN H GOODALL

Implied conditions and the definition of ‘sport’

In recent weeks, my attention has necessarily been focused on final preparation of my new book (The Essential Guide to the Use of Land and Buildings under the Planning Acts) for publication, and I have not had time to blog on various developments in planning law that have occurred recently.

There are a couple of judgments which came too late for the book but, fortunately, both of them only serve to confirm the law as stated in the text (much to my relief!).

The first of these was the judgment of the High Court in Lambeth LBC v SSCLG [2017] EWHC 2412 (Admin), on 3 October. This related to a condition that, it was claimed, should be implied in a planning permission. The case concerned a permission granted under section 73 (which, although it relates to the removal or modification of conditions in a previous planning permission, takes effect as an entirely new planning permission). The previous permission had been restricted by condition to non-food sales, but the conditions in the section 73 permission did not refer to any such restriction. The LPA refused an LDC for unrestricted A1 use, but this decision was overturned on appeal by an inspector, who granted the LDC sought by the developer. It was this appeal decision that the LPA sought to challenge.

The judgment reviewed the previous decisions mentioned below, but the court rejected the LPA’s contention that a condition preventing the sale of food could be implied in this case. To put it as shortly as possible, the decision of the Supreme Court in Trump International Golf Club Scotland Ltd. v Scottish Ministers [2015] UKSC 74 indicates that a term can be implied in a condition that has actually been attached to the permission, so as to give proper effect to the intention of that condition, but this does not over-ride the well-established principle that a condition that is entirely absent from a permission cannot be implied in that permission. Thus in I’m Your Man Limited v SSE 77 P & CR 251, a ‘temporary’ permission (so described in the description of the development authorised by the permission) could not be interpreted so as to imply a condition in that permission that the use should cease at the end of the period mentioned in the description of the development. In the Lambeth case Mrs Justice Lang drew attention to the subsequent approval of that judgment by the Divisional Court in R (Altunkaynak) v Northamptonshire Magistrates Court [2012] EWHC 174 (Admin) and by the Planning Court in Cotswold Grange Country Park LLP v SSCLG [2014] EWHC 1138 (Admin). Both of these cases concerned substantive limitations on the permission granted, not merely temporal ones.

The second recent case was the judgment of the European Court of Justice in English Bridge Union Limited v HMRC (Case C 90/16), which was handed down on 26 October. This finally determined a question that has been the subject of repeated litigation over the past few years, namely whether Bridge can be classified as a ‘sport’ for tax purposes. This judgment confirms that, in order to be a ‘sport’, the activity in question must have some element of physical exertion. I mention this judgment because it is analogous to the question of whether various card and board games can be regarded for planning purposes as coming within Use Class D2(e) (“use ……… for other indoor ……….. sports or recreations”). The decision of the ECJ (contrary to the Opinion of the Advocate-General published in June) is in line with the related English cases - English Bridge Union) v Sport England [2015] EWHC 1347 (Admin) and R (English Bridge Union) v Sport England [2015] EWHC 2875 (Admin).

Whilst the English Bridge Union litigation was concerned with the eligibility of Bridge for grants from Sport England, and its treatment for the purposes of tax and VAT, all these judgments (including now the final judgment of the ECJ) are entirely consistent with the conclusion reached in earlier cases relating to Use Class D2, such as Millington v SSETR (1999) 78 P. & C.R. 373; (1999) J.P.L. 644 (subsequently approved by the Court of Appeal – [2000] J.P.L. 297) and Rugby Football Union v SSETR [2001] EWHC 927 (Admin) (subsequently upheld in the Court of Appeal – [2002] EWCA Civ 1169). A leisure activity will only fall within Use Class D2(e) if it involves some physical effort or exertion. Absent this essential physical element, other ‘recreations’ (even if they are competitive in nature) do not fall within Class D2(e).

© MARTIN H GOODALL