East Cambridgeshire District Council challenged a conclusion made by planning inspector Stephen Wilkinson that the authority could only demonstrate a 2.1-year housing land supply.
The appeal related to proposals for the erection of up to nine homes, access, garages and associated works at a site south of Station Road, Fordham.
The site lies outside of land allocated for development in the adopted Fordham Neighbourhood Plan (FNP). The application by developer Talisker Ltd was refused by the council in April 2019.
However, Talisker Ltd appealed against the decision, arguing that the neighbourhood plan policies were out of date and the "tilted balance" in favour of sustainable development set out in paragraph 11(d) of the National Planning Policy Framework (NPPF) applied.
Paragraph 14 of the NPPF stipulates that, in cases where development proposals are contrary to a neighbourhood plan policy, the tilted balance in favour of sustainable development applies only where several criteria are met. These include that the council cannot demonstrate at least a three year supply of deliverable housing sites.
In his reasoning, Wilkinson concluded that the council could demonstrate only a 2.1-year supply, thus activating the NPPF's tilted balance and allowing the appeal.
His report said the conclusion was reached by looking at the council's June 2019 Five Year Housing Land Supply report and assessing, in line with the government's Planning Practice Guidance and the NPPF, which sites could be considered "available now and with a realistic prospect of delivery" within three years.
The report, he said, stated that the council's annual housing requirement was 1,290 homes, including a 20 per cent buffer due to past under-delivery. The inspector concluded that in total, this equated to 3,870 homes over the three-year period.
"I have estimated, using the figures included in the rows of 'Planning Permissions', 'Allocated by Development Plan' and 'Other Supply' in Table 3 of the  report that the council has 2,715 dwellings which fall within the [NPPF's] definition of delivery. This equates to a 2.1 years supply and accordingly the policies of the FNP are out of date and the tilted balance is engaged," he added.
However, East Cambridgeshire Council disputed the inspector's findings and announced that is "has now won a legal challenge" against PINS, which conceded that Wilkinson had miscalculated the council's housing land supply figure and will reconsider the appeal.
The local authority has also been awarded all costs relating to the case, which PINS conceded via a consent order before a High Court hearing took place.
According to the court consent order, the inspector “erred in his interpretation of paragraph 14(c) of the NPPF by calculating the housing supply deliverable over three years. Paragraph 14(c) of the NPPF requires the decision-maker to consider whether the local planning authority has three years’ worth of deliverable housing sites as assessed against its five-year housing requirement figure”.
It added: “Following from this misinterpretation of policy, the inspector failed to establish the number of deliverable sites for housing over a five-year period and subsequently failed to determine whether that figure represented at least sixty per cent of the overall five-year housing requirement figure (equivalent to three years’ worth of supply) in line with paragraph 14(c) of the NPPF”.
According to a statement from the council, it said if it had not taken legal action, the decision, "left unchallenged, would have been to seriously undermine the Fordham Neighbourhood Plan and all neighbourhood plans in the district".
It added that the outcome of the challenge meant that the Fordham plan and other neighbourhood plans in the district "assume their full status and confirms the council's position in relation to its housing land supply".
A PINS spokesman said: "We handle more than 20,000 appeals each year and take pride in the quality of the decisions our inspectors make. Only a very small proportion are successfully challenged.
"In this case we conceded that the Inspector had miscalculated the council's housing requirement when interpreting paragraph 14 of the National Planning Policy Framework. We are sorry the council had to challenge that decision.
"As with all High Court judgments, we have looked at the appeal decision to consider whether any lessons can be learnt to ensure we continue to deliver quality decisions."
East Cambridgeshire Council said that, following the quashed decision, PINS will reconsider the appeal with a new inspector.