Summary: The Supreme Court has clarified a long-running (and highly legalistic) debate centring upon the correct method of interpretation of wording in the NPPF. It has concluded that planning policy should no longer be given the same level of legal analysis as statute, meaning that claimants are likely to be restricted from using the Courts to try to rerun failed planning arguments disguised as points of law.

In a Nutshell

In two conjoined cases, Suffolk Coastal District Council v Hopkins Homes and Richborough Estates v Cheshire East Borough Council, the Supreme Court has clarified a long-running (and highly legalistic) debate around particular wording in the National Planning Policy Framework (the “NPPF”). The question was whether the NPPF allows a residential scheme, in circumstances where the local authority cannot demonstrate a five-year housing supply, to effectively disapply all restrictive local development plan policies affecting the supply of housing (e.g. green belt or settlement boundaries) or just those policies which deal with the quantum and distribution of housing alone.

The answer is that there may be circumstances where in the planning judgement of the decision-maker it is appropriate for restrictive policies in the development plan to be given reduced weight because of a lack of housing supply. But the NPPF does not override those policies automatically and cannot lawfully do so. Though the case has received much attention, the reality is that even with the NPPF developers have always had to make the case that the merits of their scheme and the absence of disbenefits outweigh restrictive policies.

The Supreme Court did not reverse the requirement for policy to be read objectively, as required by Tesco Stores v Dundee City Council. However, frustrated with the growth in judicial challenges to the interpretation of the NPPF the Supreme Court emphasised that policy should not be given the same level of legal analysis as statute, that the Courts should assume that expert Planning Inspectors have read policy correctly and that judges will be wary of claimants using the Courts to try and rerun failed planning arguments disguised as points of law.

The take-home message for developers is, therefore, that nothing substantive has changed. Nonetheless, some local authorities might read the tone of this Supreme Court judgment as confirming that their restrictive policies, and their interpretations of them, have some greater force than previously and are less susceptible to challenge or scrutiny. This is not the case.

Not so simple

When introduced in 2012, the NPPF was mooted by the Coalition Government to be a dramatic simplification of planning guidance to encourage sustainable growth. And yet the proliferation of judicial reviews since then over the meaning of particular policies in the NPPF has led to enormous frustration on the part of the legal planning profession, never mind the wider development industry!

On 10 May 2017 the Supreme Court gave judgment on two conjoined NPPF cases which have trudged through the lower courts: Suffolk Coastal District Council v Hopkins Homes and Richborough Estates v Cheshire East Borough Council. At the heart of proceedings was how to interpret the particular phrase ‘relevant policies for the supply of housing’, and how the NPPF’s presumption in favour of granting planning permission operates where a local planning authority is unable to demonstrate a five year housing supply.

The Supreme Court speaks

It is not necessarily controversial to state that much of the relative uncertainty of outcome in UK planning is down to politics. Struggling to provide consistency against that background is the quite complex statutory decision-making framework which Councils, Planning Inspectors and the Secretary of State must follow in determining applications for development proposals.

All developers should, therefore, be aware of what the Supreme Court has now said in Hopkins Homes and Richborough Estates about the interaction between the NPPF and development plans; about how policies in those documents are to be read; and how far a decision-maker can be challenged on their interpretation of policy.

The statutory framework

The Supreme Court has clarified how it sees the NPPF fitting into the statutory framework for determining English planning decisions.

Statute requires the decision-maker to start with the requirement to determine an application in accordance with the development plan unless material considerations indicate otherwise. This is the famous “planning balance”.

Though often trumpeted by Government, the NPPF makes clear it is no more than guidance, and as such just a material consideration. It does not displace the primacy given by the statute to the development plan in the “planning balance”.

But the NPPF has its own mini “tilted balance”. Where the development plan is absent, silent or relevant policies are out‑of‑date permission should be granted unless:

  • any adverse impacts would “significantly and demonstrably” outweigh the benefits when assessed against NPPF policies as a whole; or
  • specific NPPF policies indicate development should be restricted.

So, in certain circumstances, the decision-maker can use a material consideration, the policy of the ultimate decision-maker in UK planning, the Secretary of State, potentially to override the development plan. But that ability to override the development plan is dependent on two limitations, both of which one would assume would not be hard for many uncontroversial schemes to meet: their disbenefits do not “significantly and demonstrably” outweigh their benefits and no restrictive policies apply.

Things are not so easy where one of the restrictive policies applies - a footnote in the NPPF gives examples of these, including policies relating to Habitats Regulations, Sites of Special Scientific Interest, Green Belt, Local Green Space, Areas of Outstanding Natural Beauty, Heritage Coast, National Parks, heritage assets and flooding risk. Given the clarification that the NPPF cannot detract from the priority given by statute to the development plan, the Supreme Court has stated that the examples must include development plan policies which restrict development. This means that the decision-making framework starts with the primacy of the development plan; and now ends with the primacy of particular development plan policies (which just takes the developer back to where they started in many cases).

Who are you calling “out‑of‑date”?!

One trigger for this “tilted balance” has been much fought over in recent years. Where a local planning authority cannot demonstrate a five-year supply of deliverable housing sites, the development plan’s “relevant policies for the supply of housing” should be considered out‑of‑date. Councils defending refusals would argue that only their policies dealing with the numbers and distribution of new housing should count as “out‑of‑date”. Some developers would argue that other policies whose effect restrained supply by restricting housing development in certain parts of the authority’s area should also be considered out‑of‑date.

The Supreme Court has now also made it clear that these other policies, such as for Green Belt or settlement boundaries, should not automatically be regarded as “out of date” and simply disapplied. The decision-maker is entitled to give them less weight (acting rationally) but does not have to. In many ways this is no change – the lack of a five year housing supply has not been a “magic bullet” for housebuilders hemmed in by development plan restrictions since the earliest years of the NPPF. The focus must always be on clearly articulating the benefits of the particular scheme and where its disbenefits sit in the planning balance.

Applying the above rationale to the first case before it, a housing scheme in Suffolk, the Supreme Court upheld the planning decision. It agreed that the Planning Inspector had been entitled to give reduced weight to restrictive settlement boundary policies in a development plan that reflected out-of-date housing requirements, off the back of the “tilted balance”. Similarly, there was no issue with the Planning Inspector giving limited weight to a development plan policy on maintaining gaps between settlements because the scheme would not cause significant harm. The second case, a housing scheme in Cheshire, is not of wider application. There the Inspector (without criticism) had fallen foul of the Supreme Court’s subsequent clarification that it is for the decision-maker to accord weight to restrictive housing policies where there is no five year housing supply, not giving them special weight just because they have recently been adopted.

Warning shots

This theme of emphasising the lawful discretion of the decision-maker within the planning balance also coloured some comments on how policy should be read. In the 2012 Supreme Court case of Tesco Stores v Dundee City Council, it was held that policy statements should be interpreted objectively in accordance with the language used, read as always in its proper context. This assisted developers who were otherwise faced with the proposition that policies were to be read as the decision-maker wished, so long as the decision reached was not irrational.

In Hopkins and Richborough, the Supreme Court was clearly frustrated at the volume of litigation generated by the words “relevant policies for the supply of housing”. It did not reverse the objectivity required by Tesco Stores v Dundee City Council. And it did concede that the Planning Court would still have an important role in ensuring consistency in the interpretation of specific policies. But the Supreme Court did give some warning shots to claimants (of all stripes) trying to quash planning permissions on the back of allegedly unclear policies:

  • policy is not to be read with the same level of legal analysis as statute;
  • the Courts should respect the expertise of the Planning Inspectorate, akin to an expert tribunal, and start at least from the presumption that they will have understood a policy framework correctly; and
  • judges will expect claimants to show that their case really does relate to how a policy should be interpreted in law, and is not really a complaint against how the decision-maker applied the policy in their case, a dressed up merits challenge.

…so what?

Hopkins Homes and Richborough Estates have caused much noise in the legal planning profession. Cheshire East Council commented on its website that planning authorities are now better able to resist unsustainable and speculative housing schemes, in particular the protection of green belt. Even so, in practice what has changed? The strength of the NPPF at planning inquiries to force through unsustainable housing schemes has always been overestimated. Policy is still to be read objectively. The Courts have always frowned on objectors (or developers) using them as a second bite at the cherry after failing at the planning stage.

What Hopkins Homes and Richborough Estates may do is give greater confidence to local authorities, but particularly the Planning Inspectorate, to exercise their planning judgement. This means that a prudent developer will need their project team upfront to be honest, clear and compelling about where the merits and challenges of their scheme fall within the statutory framework. There are no magic bullets, under the NPPF or otherwise. As ever, local authorities and Inspectors need to be presented with a clearly articulated route through the policy maze on submission to maximise certainty of outcome.