With many local planning authorities now making progress on bringing forward their proposals for Community Infrastructure Levy (CIL), I have had occasion in the last few days to consult the CIL Regulations again in relation to the question of landowner liability for CIL and to tackle a couple of what I think may be common misconceptions. Both of these arise in the context of the risk of CIL liability defaulting to a landowner.
The first relates to the question of whether there may still be a risk of double liability for CIL and section 106 contributions. Although the CIL Regulations make clear that development under a planning permission granted before the relevant local authority adopts CIL in the area does not trigger CIL liability, the position is not clear cut in the case of a subsequent permission granted under a s 73 application to vary a condition. There may be a number of reasons why a developer may wish to make a s 73 application to vary. This could arise after CIL is adopted in the area and in circumstances where the original 106 (ie the 106 put in place with the original permission) would bind the permission "as varied".
Although the CIL Regulations exclude such a varied permission from liability (if the original permission was excluded), that only applies if the variation also extends time under the original permission. Current Government advice is not to extend time under variations - so parties could find themselves caught out.
So if negotiating options today, say where the landowner is to be obliged to enter into a 106, you may want to introduce a proviso that the owner will only be required to do so if the 106 contains a CIL protection provision.
The other point to mention relates to phased developments. The risks of continued landowner liability, under s 106 agreements, in the context of phased acquisitions is well understood - but the same issue arises under CIL. Where, following the adoption of CIL in the area, planning permission is granted, CIL liability arises, in one lot, for the whole development. If the permission permits development to be implemented in phases, then liability arises in phases - so if land is to be "drawn down" in those same phases, a landowner can control liability by ensuring that the drawn down tranches match the permitted phases.
However, the landowner may not have any control over the way the conditions on the permission are worded - or the controls which exist in the option or conditional contract may not allow the landowner to influence the conditions to that degree. For current and future contracts/options, where there is to be phased draw down, it would be prudent for the landowner to seek protection in this way.