Town Centre First Policy Threatened by Legal Case

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Those of us involved in retail are looking very carefully at the outcome of this week’s Court of Appeal case brought by Peel relating to its Blackburn out-of-town retail park.  If allowed, it could drive a coach and horses through successive Government’s "town centres first" retail planning policy.  At stake are a number of bulky goods retail parks wishing to sell town centre goods and boost their portfolio values. On the flipside vacancy rates in town centre retail units may well rise.

Peel lost the case in the High Court but renewed the arguments in the Court of Appeal. Peel argues it has been released from a bulky goods restriction in a planning obligation. The argument centres on the proposition that subsequent planning permissions to allow modifications to existing retail units, which either did not specify the use or where a ‘blanket’ retail use was specified, meant the new permissions granted open A1 retail use. The planning obligation contained a common proviso limiting the obligation to the development at that time, not future development, according to Peel.  So, Peel argued, when subsequent permissions for the alterations were granted those new permissions engaged the proviso, and the bulky goods restriction released.

Hyndburn Borough Council, neighbouring Blackburn with Darwen Borough Council and owners of The Mall shopping centre in Blackburn town centre, joined forces to oppose Peel's case.

All sides explored in great detail the law and facts around what “development” means for the purposes of triggering the proviso in the planning agreement.  Separate points were made on the nature and extent of the planning doctrine – ‘a new chapter in the planning history’ – and its ability to release developments from previous planning restrictions.

Developers should be aware of the significance of this case.  Its consequences are likely to extend beyond retail to owners and operators of any property with restrictions on use.  But be warned, whatever the outcome of Peel’s case, other apparently similar cases will need to be looked at carefully.  The facts of each situation, and the precise wording in each planning obligation and planning permission, may result in a different outcome.  There is a lot to play for.  As we often hear, the devil is in the detail.  And what a devil that may be.

It will be a few weeks before judgment is handed down. As advisors in the case we’ll be among the first to know, so watch this space.

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