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The Interpretation Act and discharge of affordable housing obligations

Construction iStock 000002149516XSmall 146x219Richard Moules considers the outcome of a Planning Court case on whether the Interpretation Act 1978 preserved jurisdiction to modify or discharge affordable housing obligations.

Section 106 BA of the Town and Country Planning Act 1990 created a process for developers to apply to modify or discharge affordable housing obligations in a s.106 agreement that made their development economically unviable. Section 106 BA was a temporary provision that was repealed on 30 April 2016.

In R (on the application of the City of York) v Secretary of State for Housing, Communities and Local Government [2018] EWHC 2699 (Admin), the Interested Party had built its housing development and then applied under s.106 BA on 29 April 2016. The Claimant council refused the application, but the Secretary of State allowed the Interested Party’s appeal and modified the affordable housing obligation to reduce the affordable housing contribution. The Claimant argued that:

  1. 106 BA did not apply to completed developments; and
  2. The Secretary of State had no jurisdiction because s.106BA-106BC had been repealed.

Kerr J dismissed the claim:

  1. He held that an application under s.106BA could be made even if the development in question had been completed. The provision was not confined to “stalled schemes” as the claimant had contended;
  2. Even though s.106BA was repealed on 30 April 2016, the general saving for acquired rights in section 16(1)(c) of the Interpretation Act 1978 operated to give local authorities jurisdiction to determine any applications that had been made before that date. The making of an application gave a contingent acquired right because s.106BA(5) mandated that the decision-maker deal with the application so as to make the development economically viable i.e. the decision-maker enjoyed no discretion as to the outcome. Section 16(1)(e) also operated to preserve the Secretary of State’s jurisdiction to deal with appeals relating to applications made before 30 April 2016.

Although the legislative provisions have been repealed and no new applications are possible, the judgment will come as a welcome relief to the many parties who did modify or discharge affordable housing applications after 30 April 2016 when dealing with pre-30 April 2016 applications.

A copy of the judgment can be found here.

Richard Moules is a barrister at Landmark Chambers and acted for the Secretary of State.

Richard Turney acted for the Claimant, while Paul Brown QC acted for the Interested Party. Both are also from Landmark Chambers.