Planning Appeals, s.106 Agreements and a few practical issues.....
As those of you who are active on LinkedIn have probably noticed, the Planning Inspectorate has recently updated its guidance in relation to planning appeals and s.106 Agreements.
The revised guidance now reads as follows:
"18.2. Deadlines for the receipt of planning obligations
18.2.1. Planning obligations received after the following deadlines will be taken into account only at the Inspector’s discretion. The Inspector will not delay the issue of a decision to wait for an obligation to be executed unless there are very exceptional circumstances.
18.2.2. Written representations
18.2.2.1. If the appeal is following the written representations procedure (see 9) the appellant must ensure that we receive an executed and certified copy of the planning obligation at the time of making their appeal.
18.2.3. Hearings and inquiries
18.2.3.1. There should be continuous dialogue between the parties before the hearing or inquiry about the draft planning obligation to ensure that the final draft is as good as it can be.
18.2.3.2. The appellant should make sure that a final draft, agreed by all parties to it, is received by us no later than 10 working days before the hearing or inquiry opens. The Inspector’s and other parties’ preparation for the hearing or inquiry is likely to be significantly disrupted if this deadline is not met."
The summary guidance on submitting an appeal has also been updated, to read as follows:
The revised guidance significantly accelerates the point at which a legal agreements need to be prepared. Particularly, in relation to written reps appeals.
It also raises some tricky practical issues, that we will all need to get to grips with pretty darn quickly.
1.The guidance is not consistent
Firstly, and only because my inner pedant is insisting, we need to grapple with the fact that the detailed and summary guidance from PINs are not entirely consistent. At least, not insofar as they relate to hearings and inquiries.
Both sets of guidance agree that written reps appeals need to be accompanied by a completed legal agreement at the point of submission. They differ, however, when it comes legal agreements for hearings and inquiries.
Whilst the summary guidance states that these appeals should be submitted with a draft s.106 Agreement, the detailed guidance does not.
Instead, the detailed guidance says that “there should be continuous dialogue between the parties before the hearing or inquiry about the draft planning obligation” and that the final draft “agreed by all parties” should be to received “no later than 10 working days before the hearing or inquiry opens”.
When that draft first needs to be submitted is not mentioned at all.
2. Local government resourcing
We also need to address the second elephant in the room. Which, yet again, is the knotty issue of local government capacity and resourcing.
There are only so many planning officers, and so many legal officers, in any given local planning authority. They all have high workloads and a limited amount of time.
The upshot of which, unfortunately, is that getting local authority legal teams to engage with drafting s.106 agreements during the progression of a planning application can be difficult. There often simply aren't enough resources available to allow the frontloading of negotiations in this manner.
If it is difficult to find the resources to settle a s.106 Agreement during the progression of a planning application - it is likely to be even harder to do so once the application has been refused!
Not least as there is very little incentive for a local planning authority to prioritise such agreements over other applications, with a resolution to grant.
As such, the prospect of getting a legal agreement fully negotiated, signed and completed before a written reps appeal has even been submitted is likely to be a daunting one for many potential appellants.
3. Choice of appeal procedure
You might think that the obvious way to deal with this would be to avoid making a written reps appeal, and instead opt for a hearing.
The slight issue with that tactic, is that the appellant doesn't decide how an appeal is determined. That decision rests with PINs.
Whilst an appellant can request a specific procedural route, those requests need to be justified. PINs will take the request into account, but ultimately, allocates appeals to the procedural route considered most appropriate.
As such, it is probable that there will be appellants who have submitted an appeal, having requested it be determined at a hearing, who are then allocated written reps.
If that happens, how do you deal with the s.106 Agreement? As any draft agreements submitted with the appeal would no longer meet the requirements of the guidance. Remember, that requires the legal agreement to have been completed prior to submission.
4. Form of agreement
Does this then mean that there will be more use of unilateral undertakings?
Well, probably. In fact, given the resourcing issues mentioned above, I would put money on it. After all, the one big advantage of unilateral undertakings is that the LPA does not have to sign them.
This approach, however, is not without it's risks. Especially if you have not been able to agree the drafting with the LPA prior to submission.
The three big points to remember in this context are as follows:
- You cannot place obligations on an LPA in a unilateral undertaking - as they haven't signed it.
- Legal Agreements take effect when they are completed; and
- The only way to amend a completed unilateral undertaking is by way of a further deed of variation that, crucially, needs to be entered into by the LPA.*
As such, once a unilteral undertaking has completed you are essentially stuck with the content; unless the LPA is willing to negotiate a whole new agreement to change it.
This could lead to a wide range of complications, especially if the original unilateral is not acceptable to the LPA or the legal obligations required change during the process of the appeal. If nothing else, you may end up negotiating more legal agreements than you otherwise would have done!
5. Blue pencil clauses and the importance of boilerplate
Finally, this puts into sharp relief the importance of boilerplate clauses.
Boilerplate is the raft of small print and technical legal provisions at the start of a s.106 agreement - i.e. the bits before you get to the actual obligations!
They tend to be fairly standardised and address dry, but crucial, issues such as:
- Jurisdiction
- Choice of law
- Interpretation
- Dispute resolution
- When particular provisions take effect;
- Rights of third parties;
- Release provisions; and
- Blue pencil clauses.
Boilerplate provisions have always been important. Vital even. However, getting it right becomes even more crucial when you are faced with a situation where you might not be able to fully agree a legal agreement with an LPA.
In particular, the clauses governing:
- When certain parts of the agreement take effect; and
- What happens if parts of the agreement are either found to be unlawful or unnecessary by a planning inspector (blue pencil clauses).
can be the difference between a manageable risk and an absolute disaster!
An effective blue pencil clause is the only way to manage a situation where an obligation included in a legal agreement is given no weight or found to be unnecessary by a planning inspector.
Without one, a developer can find themselves contractually obliged to pay a contribution (or do some works) even though the appeal decision states there is no benefit or need for them to do so.
This is not an ideal situation.
As such, paying very close attention to the drafting of boilerplate provisions is now even more highly recommended than it was previously.
Conclusion
I think everyone would agree that settling legal agreements early in an appeal process is sensible, and to be encouraged. That said, the new PINs guidance does raise some practical issues, which may not be easy to overcome.
If nothing else, these revisions will mean an immediate uptick in work for lawyers. So, please be nice to your local authority planning solicitor**. Their busy autumn looks as if it has just got an awful lot busier!
*Now, both of these last two points also apply to bilateral agreements, but given they are usually heavily negotiated, there should (hopefully) be less need for post completion changes.
**Actually, please be nice to all planning solicitors. We are generally lovely folk. I promise. *!
*! don't be mean to barristers either…. I may have wandered down a rabbit hole here. Let's just be nice to everyone.
If you intend to rely on a planning obligation you should send an executed and certified copy with your appeal form for appeals proceeding by written representations. For appeals proceeding by either a hearing or an inquiry you should send a draft version with your appeal form and our start letter we will send you will tell you when you must send the final draft to us. For further information please see our Planning Obligations: good practice advice guide.”
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