Retail parks and the law of unintended consequences

Last month, developer Peel Holdings lost its High Court bid to overturn Hyndburn Borough Council's refusal of its plans to redevelop an out of town retail park. Planning lawyer Duncan Field takes a closer look at the judge's ruling.

Duncan Field
Duncan Field

Earlier this year, the circumstances at the Whitebirk Retail Park, Rishton, near Blackburn, were thought sufficiently serious to be debated in the House of Commons. More recently, those circumstances were considered by the High Court in Peel Land and Property Investments plc v Hyndburn Borough Council.

As the owner of the retail park, Peel had secured a series of planning permissions which permitted both external alterations and internal reconfiguration at some of the retail units. The units were subject to a planning obligation which restricted the range of goods that could be sold but this restriction was not repeated in the new permissions. Peel argued that in each case, this resulted in the creation of one or two new units and since they were designed to be used for all retail sales, under section 75(3) Town and Country Planning Act 1990 the units benefited from planning permission for unrestricted retail use; alternatively, this constituted a new chapter in the planning history of each unit which was regulated only by the new permissions. This meant that the planning obligation, with the use restrictions, would fall away.

A similar sequence of events can be observed in the planning history of many retail parks around the country and it is true to say that Peel’s analysis would have been shared by many, relying (as Peel did) on the approach taken by the court in two previous cases: Stevenage Borough Council v Secretary of State (2010) and Prudential Assurance v Sunderland City Council and Peel Investments (2010). However, when His Honour Judge Waksman handed down judgment on 31 October, he distinguished both the Stevenage case (in which he had been the judge) and the Sunderland case, effectively on the basis that in those cases the Court had not been given the opportunity to examine all the relevant issues. 

Judge Waksman adopted the following approach:

  • A planning permission should be looked at carefully to ascertain exactly what works are permitted. The terms of the application and the decision notice are the starting point and the scope of the planning permission should not be "read up" or "read down" from what the applicant and the Council intended (e.g. to include or exclude internal works which would not normally require permission).
  • A change in use is authorised by a planning permission for works if it is expressly stated or a necessary implication of the development: a change of use will usually only be implied under section 75(3) where the works either involve the erection of a new building (where the pre-existing use is not retained) or can only be used for a different purpose.
  • A planning permission will only result in a new chapter in the planning history of a unit if it achieves a radical change in use i.e. one that is necessarily inconsistent with the pre-existing use; the simple sub-division of a unit is unlikely to be enough to achieve this.

If the judgment is left to stand, in these circumstances there will need to be a more careful analysis of the terms of the planning permission and the background against which it was granted; as a general rule, it is far less likely that a material change in use will be created unintentionally when permission is granted for physical alterations. However, before we draw too many conclusions, Peel has been given permission to appeal to the Court of Appeal and they will feel that some of the issues, particularly the application of section 75(3) and the principle of whether a new chapter in the planning history of a unit is created, deserve further consideration.

Duncan Field is a partner and planning specialist at law firm Wragge & Co


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