Last month, planning permission to redevelop the former Westferry Printworks site in East London into a 1,500-home scheme was overturned when secretary of state Robert Jenrick admitted "apparent bias" in his decision to approve the application against the advice of his own inspector.
The London Borough of Tower Hamlets had launched a legal challenge to the consent, which was issued in January, because the timing of the controversial decision allowed the applicant – a business owned by media mogul and alleged Tory donor Richard Desmond – to avoid having to pay between £30-50 million in community infrastructure levy (CIL) payments. These would have been due given the planned introduction by the council of a new CIL charging schedule, which included new rates for the application site area, just three days after the decision letter on 14 January.
Planning barrister Christopher Young QC, of No5 Chambers, described the decision to admit apparent bias as "dynamite" and without precedent. Subsequent national newspaper revelations that Jenrick attended a dinner in November with Desmond, the former Express newspapers proprietor, in which the topic of the £1 billion scheme was raised, have only raised the stakes politically. Some observers believe it will presage changes in planning decision-making in order to avoid a loss of faith in the whole system.
A spokesman for the Ministry of Housing, Communities and Local Government (MHCLG) said Jenrick denied any actual bias in taking the decision. However, "apparent bias" does not require bias to be proven. The legal test is that a well-informed observer could reasonably conclude that bias was a real possibility.
In a High Court consent order, Justice Holgate said the government accepted that it timed the decision to allow Desmond's Westferry Developments to avoid the CIL charge, and that this would "lead the fair minded and informed observer to conclude that there was a real possibility that the first defendant [Jenrick] was biased". The appeal will now be reconsidered by a different minister.
This concession has shocked legal experts, who said it is the first time any secretary of state, who has a quasi-judicial role in relation to appeal decisions, has made such an admission. Planning barrister Sasha White QC of Landmark Chambers, who acted on behalf of Tower Hamlets in the judicial review, said the case "could not be more serious" because of the potential to undermine the planning system. He called on the secretary of state to publish all correspondence relating to the decision, and said: "[Jenrick] is still making decisions on a daily basis. It calls into question his administration of the whole system. Applicants and third parties have an absolute right to be 100 per cent satisfied that a decision will be dealt with fairly."
No5 Chambers' Young added: "It's hugely embarrassing. The planning system is very dependent upon protecting the perception of fairness. This is England. We expect a certain standard of conduct from political figures."
Nicola Gooch, a planning partner at law firm Irwin Mitchell said the shock was all the greater as apparent bias is a "notoriously difficult" grounds on which to make a legal challenge. Three important cases made in the last five years on these grounds have all failed, she said. This was despite the fact that in one of these cases, Broadview Energy Developments vs Secretary of State, the judge found in 2015 that local MP Andrea Leadsom, who had lobbied the relevant minister on the issue, should not have done so. Gooch said: "This will completely re-invigorate these types of claims at a ministerial level. This makes me more likely to advance such a claim [on behalf of a client]."
However, because the case was effectively conceded and thus resulted in no reasoned judgment, experts said it sets no significant legal precedent, limiting its wider impact on other cases. Landmark Chambers' White said: "I don't think we'll see many more challenges. The legal test remains pretty high." Mike Kiely, chairman of the Planning Officers' Society, said: "It might embolden people to make a challenge, but I don't think this will make it easier to stand up the accusation. I don't think councils should lose sleep [about being challenged]."
Councils generally protect themselves from such challenges through decision-making members' disclosure of any potential conflicts of interest at the start of planning committee meetings. However, secretary of state decisions have never included similar disclosures, a practice that some commentators said will now have to change. Irwin Mitchell's Gooch said the housing ministry was likely to "need to have a complete overhaul of the decision-making process. They could ask ministers to declare all lobbying."
Kiely said: "It might be a good idea for the ministry to reflect on this and put in place a process to ensure it doesn't happen again. The secretary of state can learn a lesson from council committees who get all this stuff out in the open." The MHCLG declined to comment on the suggestion that it should overhaul the decision-making process.