Housing minister Grant Shapps unveiled new regulations last month to allow the creation of houses in multiple occupation without the need for an application.
Shapps said he would allow councils flexibility to use article 4 directions and require applications at their discretion. But Milton Keynes Council, Oxford City Council and Newcastle City Council launched judicial review proceedings (Planning, 15 October, p1).
The three authorities claimed that the consultation process for the changes was inadequate and asked for a strengthening of powers for using article 4 directions. These are usually applied in areas where development poses a threat to the character of the area - for example in conservation areas.
Milton Keynes warned that claims from potential landlords could total more than £3 million. Oxford's deputy leader Ed Turner added: "The court said that the government could rely on consultations performed under the previous government. The compensation threat from landlords is something no council is looking to pay for."