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Defective planning permissions and negligence

Planning 146x219A judge recently rejected a claim for compensation against a local authority based on alleged reliance on a defective grant of planning permission. Tom Challis explains why.

In Schiavone (1) & Fawcus (2) v Worthing Borough Council (Whipple J, 30 October 2015) a claim for compensation against the council based on alleged reliance on a defective grant of planning permission was struck out as having no reasonable prospect of success. There was no liability for compensation in the circumstances alleged and outside sections 97 and 107 of the Town and Country Planning Act 1990 (the Act).

Background

The claimants had a business running care homes. They were granted planning permission for an extension. However, the permission was defective because it did not set out reasons as required under the Act. A neighbour brought judicial review proceedings to quash the permission. Since the permission was undoubtedly defective, the council did not oppose the proceedings. The claimants consented to the permission being quashed believing that the permission would subsequently be granted as a matter of routine. It was not; their second application was refused because the proposal was in breach of local planning guidance.

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The claimants brought a claim seeking damages. The principal allegation was that they had consented to the original permission being quashed because the council had advised them that permission would be granted as a matter of routine on re-application. This was denied.

The council applied to the court for summary judgment on the grounds that no duty was owed to the claimants and the claim had no realistic prospect of success. The council relied on the decision of the High Court in Wooldridge v Torridge DC [2011]; in that case the claimant had incurred losses when a defective planning permission was quashed on application by an aggrieved third party. A claim in negligence was dismissed on the basis that the council did not owe the claimant a duty of care.

Following the reasoning in Wooldridge, Master Kay QC struck out the claim. It was also relevant that the claimants had consented to the permission being quashed and, even if they had not done so, it was inevitable that it would have been quashed given the undisputed defect with the original permission. The claimants appealed.

Decision

The appeal was dismissed. The judgment in Wooldridge was clear and there was no sensible reason to depart from its principles; it would be an extreme extension of duty of care principles to impose liability for economic loss because of a mistake in granting planning permission. Further, since the application for judicial review of the original decision was bound to succeed the council had been right to ask the claimants to consent to it. The claimants could have sought their own legal advice and it was not for the council to advise them; it had to look after its own interests. There is a statutory mechanism for compensation under the Act if a defective planning permission is relied on and losses are incurred (although this did not apply here). Outside that mechanism there was no liability and no private law duty of care.

Comment

This decision follows the general principle that local authorities will not be liable in negligence for mistakes in granting planning permission. Per Wooldridge, whilst there was a relationship of proximity between the parties, it was not fair, just and reasonable for a common law duty of care to be imposed on a local authority in these circumstances.

Tom Challis is a partner at Weightmans, whose Local Government Team acted on behalf of the council in this claim. Tom can be contacted on 01322 283150 or This email address is being protected from spambots. You need JavaScript enabled to view it..

 

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