Revocation orders, compensation and judicial review

A council has avoided liability for compensation for the effects of a rare “revocation order” made by them to revoke a planning permission granted in error for residential development by launching a Councillor-led judicial review of the grant after the revocation order proceedings had commenced. Meyric Lewis explains what happened.

Background

The developer made an application for planning permission for residential development on a site in West Street, Ewell, Surrey in June 2019 for “Demolition of existing detached house and construction of two houses and three flats” under ref. 19/01604/FUL.

Epsom and Ewell Borough Council’s Planning Committee resolved to refuse planning permission in March 2020 on the ground that

“The design of the development by reason of its scale, massing, bulk and detail would fail to preserve or enhance the character and appearance of the Ewell Village Conservation Area, resulting in less than substantial harm to the designated heritage asset. The development does not achieve public benefits that outweigh the harm and adverse impacts of the scheme when assessed against the policies in the National Planning Policy Framework taken as a whole. The proposal is contrary to the NPPF, policies DM8, DM9, and DM10 of the Development Management Policies Document 2015 and CS5 of the Core Strategy 2007”.

The developer’s planning consultant was present at the Planning Committee meeting at which the council resolved to refuse the application.

The officer’s report on the application contained a recommendation for approval but the council’s recorded Minutes set out the committee’s reasons for departing from that recommendation including the above reason for refusal.

However, as a result of an administrative error and contrary to the terms of the committee’s resolution refusing the application, a decision notice was issued on a “grant” template rather than a “refusal” template. The decision notice contained no planning conditions and actually stated the council’s reason for refusal in the place where any conditions would have been.

The council emailed the planning consultant on the following day attaching a corrected replacement decision notice and inviting him to accept the “simple administrative error”. The planning consultant nevertheless declined, maintaining that the decision notice was a “lawful decision granting planning permission” and that “the council as local planning authority cannot issue a new decision”.

Revocation Order

The council initially took the view that the quickest way to resolve matters would be to make a revocation order under section 97(1) of the Town and Country Planning Act 1990 in respect of the manifestly defective planning permission.

The developer objected to the revocation order, in effect maintaining that the defective permission should be upheld, and indicated an intention to claim compensation. Making an objection gives rise to a right to be heard, see section 98(4) of the 1990 Act, and a hearing was originally listed for February 2021 which was then converted to an inquiry due to be held in May 2021.

Revocation order proceedings are so rare that, unlike for CPO inquiries and planning appeals, there are no procedure rules governing their determination.

JR instead

In February, the council further considered their compensation exposure arising under section 107 of the Act for losses resulting from the confirmation of the revocation order (despite the question of what value might attach to a “planning permission” which was subject to no conditions and which quoted a reason for refusal of planning permission where the conditions should have been) and decided to commence judicial review proceedings instead – and applied for the necessary extension of time to bring them. The Inspector appointed on the inquiry agreed to hold the proceedings in abeyance in the meantime.

The claimant was a councillor and a member of the council’s Planning Committee, ie the claim was brought by the claimant in form but was in substance a challenge by the council to its own decision. This approach was approved by the Court of Appeal in R v. Bassetlaw DC ex p. Oxby [1998] PLCR 283 – and, importantly, avoids exposure to compensation under section 107.

The grounds of claim were:

1. The decision notice was a nullity and of no legal effect; and/or
2. The decision notice was void for uncertainty; and/or
3. The “grant” of planning permission was issued in error and was not authorised by the resolution of the council’s committee.

In seeking an extension of time to bring the claim the council relied on the decision of the Court of Appeal in R (Thornton Hall Hotel Ltd) v. Wirral MBC [2019] EWCA Civ 737 – another late challenge to an error in a grant of planning permission – at [45]:

“this is clearly a case in which, leaving aside the delay, the court would generally not hesitate to quash the planning permission”.

Thornton Hall cites the earlier decision in Norfolk County Council v. Secretary of State for the Environment [1973] 1 WLR 1400 – grant of permission in error/want of authority – in which Lord Widgery CJ said at 1405:

“What one hopes to achieve in a situation like this, where there has been an honest mistake, is that everybody shall end up in the position in which they would have been if no mistake had been made, and if we allow this appeal and recognise that the planning permission cannot be acted upon, that is exactly the result which we should produce”.

On prejudice, the council relied on the dictum of Hobhouse LJ in ex parte Oxby at 299:

“it is not just that [the applicant for planning permission] should enjoy the benefit if they should not have received it in the first place.  They have no legitimate grievance on being deprived of what they should never have had.”

They also pointed out that the developer could claim back his costs of the abandoned revocation order proceedings on CPO (and “analogous order”) principles, see NPPG para. 057 ref. ID: 16-057-20140306.

The council acknowledged service conceding the claim. The developer did not acknowledge service of the claim and did not therefore advance any grounds of resistance.

Permission granted

Lang J granted permission to apply for judicial review and an extension of time for bringing the claim in April 2021.

Her observations on granting permission and extending time were as follows:

“The Defendant refused planning permission for the Interested Party’s application at a Committee meeting on 12 March 2020, but due to administrative error, it issued a decision notice purporting to grant planning permission on 17 March 2020.

This claim, seeking a declaration and/or quashing order, was filed on 24 February 2021. Although the delay in filing the claim is very significant (just under a year), I have granted an extension of time because the merits of the claim (as pleaded in the Statement of Facts and Grounds) are very strong, and the extension does not cause any unjust prejudice to the Interested Party (as opposed to depriving him of an undeserved windfall). I note that the Interested Party’s planning consultant was present at the meeting when planning permission was refused, and was notified of the Defendant’s error very soon after it was made. On 1 April 2020, the Defendant made a revocation order under section 97(1) Town and Country Planning Act 1990, which the Interested Party has objected to, maintaining that permission has been granted and he should be compensated for its loss.  An inquiry is due to be held in May 2021.

In my view, the lawfulness of the decision notice of 17 March 2020 ought to be ruled upon by this Court prior to the determination of the revocation proceedings”.

Consent order/Conclusion

The parties agreed a consent order providing for the quashing of the permission which was approved by Waksman J and so the decision will be redetermined. The revocation order proceedings will be discontinued.

Meyric Lewis is a barrister at Francis Taylor Building. He represented the Council instructed by Amardip Healy, Chief Legal Officer for Epsom and Ewell Borough Council and Byron Britton, Head of Law at the South London Legal Partnership.