Pooled transport fund and guidance ruled unlawful

A Scottish strategic development authority's pooled fund for off-site transport improvements serving major growth areas, underpinned by supplementary planning guidance (SPG), has been declared unlawful by the Supreme Court.

Housebuilders’ contributions to the fund were set at a fixed sum per unit but were not directly related to the impact of their own development. The contributions were secured under section 75 of the Town and Country Planning (Scotland) Act 1997. The claimants, who had previously entered into an obligation under the scheme, maintained that the monies need not be paid if the SPG was subsequently judged to be unlawful. The Court of Session agreed that the guidance was unlawful.

In the Supreme Court, Lord Hodge recognised that there was much to be said in favour of the scheme, since it enabled the authority to facilitate development within its area and allowed developers to assess the extent to which their projects were viable. However, he concluded that the 1997 act did not allow for the scheme that the authority had adopted.

It was unlawful, he opined because, it required developers to contribute to a pooled fund to finance transport infrastructure improvements which the development plan promoted. Such improvements might have no more than a trivial connection with the actual schemes proposed by the developers involved, he found. Neither did the obligation restrict development from proceeding until the financial contribution had been spent and the transport improvements secured, he noted.

The court held that the obligation neither restricted nor regulated development of the claimants’ site and thus fell outside the scope of section 75. Since the obligation the developer had entered into could not therefore be a relevant consideration in determination of an application, it ruled, it was not within the authority’s power to require it. The requirement and the SPG upon which the local authority sought to justify it were unlawful, it concluded.

Aberdeen City and Shire Strategic Development Planning Authority v Elsick Development Company Ltd

25 October 2017

Ref: [2017] UKSC 66

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