Office to Residential Permitted Development Rights: Current Challenges and Future Uncertainties

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Summary: An interesting week for those seeking to rely on the recently introduced permitted development rights allowing offices to be transferred into homes without a planning application. The Judge considering the judicial review of the Government’s procedure in deciding which areas to exempt from the permitted development rights has suggested that Councils could refuse to determine applications for prior approval until the outcome is known. Meanwhile Camden have issued a prior approval refusal citing reasons such as lack of affordable housing and other contributions

You should read this article if you wish to rely on the permitted development rights introduced by the Government on 30 May 2013 to enable a change of use from Class B1(a) Offices to Residential.  Some of the London Boroughs are becoming tougher and the High Court has questioned whether Councils should refuse to determine prior approval applications while the judicial review challenges remain outstanding. 

The London Boroughs of Islington, Richmond, Camden and Lambeth judicially reviewed the Government’s procedure in deciding which areas to exempt from the recently introduced permitted development rights allowing offices to be transferred into homes without a planning application.  The substantive hearing in that application was heard yesterday in the High Court.  The judge, Mr Justice Collins, has gone away to provide a written judgment and so the outcome of the hearing is unlikely to be known until just before Christmas or early in the New Year.

On the plus side, the Councils are not seeking to challenge the legislation which brought in the new rights.  Instead they are seeking a re-consultation of the areas they sought for exclusion.  At the heart of the Councils’ objection is that the selection process for determining which areas should be exempt involved consultants from outside of the Department for Communities and Local Government (“DCLG”), scoring each Council using a point system based on four criteria.  Their complaint is that had they known about the criteria, they may have structured their responses differently, which could have led to a different outcome.

During the hearing yesterday, the judge did suggest that the Councils concerned  would be entitled not to determine applications for prior approval while the proceedings are on-going.  Counsel for Lambeth Counsel indicated, rightly in our view, that this would not be appropriate, given that the legislation provides for a deemed approval process.    If the local planning authority does not refuse or grant the application for prior approval within 56 days of the making of the application, it is automatically deemed to have been given.

No conclusion was reached on the issue yesterday and Mr Justice Collins has indicated that he will give thought to this within his judgment.  Given the deemed approval process, we do struggle to see how Councils can opt not to determine.  The 56 days runs from the date that the application is received by the Council.

The risk, however, for a developer is that, if a Council does establish a policy of not determining prior approval applications until the judicial reviews have been completed and potentially any remedy implemented,  the Council could support this stance by exercising enforcement proceedings against developers that proceed after the expiry of the 56 day period.    While there is a right of appeal against an enforcement notice there is obviously the inconvenience and continued uncertainty and delay while going through that process.

We have also found that with the increasing number of applications for prior approval that certain Councils are changing tack with the prior approval process.  Earlier this week Camden Council  issued a refusal on a prior approval application giving 15 reasons for refusal.  These included matters such as lack of affordable housing, lack of a contribution towards educational  infrastructure, lack of a contribution towards public open space, lack of provision of an ecology and habitat plan, failure to secure through a section 106 legal agreement level 3 of the Code for Sustainable Homes as well as other matters.  This was against the backdrop of an agreed and signed s106 legal agreement being deposited by the applicant with the Council covering 4 of the 15 matters.

When the new permitted development rights were brought into effect, the Government was clear that the prior approval process was to be tightly drawn and that prior approval is only required, and information is can only be required to be submitted, in relation to the matters of:

  • Transport and highway impacts to the development;
  • Contamination risks on the site; and
  • Flooding risks on the site.

The local planning authority can request information regarding the risk and impacts to enable them to assess the above or to explain how the impacts are to be mitigated.

Camden Council has, however, received legal advice, a copy of which is awaited, which suggests that the Council is entitled to look at considerations beyond the three items listed above.  Reliance is being placed on a provision in the legislation which states how the local planning authority is to determine the prior approval application and what they are to have regard to.  One of the sub provisions includes having regard to the National Planning Policy Framework “as if the application were a planning application” and hence  the Council has issued a decision notice which goes beyond the matters intended by Government.

Following the introduction of the new rights, this provision has been identified as an area of ambiguity with some commentators having assumed that the ambiguity means that the authorities could use other sections of the NPPF to resist office to residential proposals on the grounds of non-conformity with the development plan and other material considerations.  Most of the authoritative stakeholders, such as the Peak District National Park Authority have made it clear that while the authority must take into account any representations made to them as a result of any consultation, and give due regard to the

NPPF as if the application were a planning application, the latter is only in respect of those matters which the authority can consider under the notification i.e. highways, flood risk and contamination.  The Peak District National Park Authority have indicated that they have obtained advice on this from DCLG and we are seeking to obtain details of that advice.

We have sought to clarify with Camden whether they will be looking to treat every prior approval application as a planning application and current indications are that this would depend on the facts of each case.

The combination of Mr Justice Collins’ comments during yesterday’s proceedings  and the recent actions of Camden Council have raised uncertainties over the extent to which the developers can be confident in obtaining a positive prior approval.

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