Town & Country Planning – Community Infrastructure Levy

Town & Country Planning – Community Infrastructure Levy: Self-Build Exemption Unavailable (Gardiner v Hertsmere Borough Council)

Author: Jim Ryan

Planning analysis: Community Infrastructure Levy (CIL) was created to provide funding from new development to support the infrastructure requirements arising from the development of an area. It was intended to replace the familiar system of planning obligations under section 106 of the Town and Country Planning Act 1990 (TCPA 1990), providing a fairer, quicker, process for developer contributions. CIL was introduced in Part 11 of the Planning Act 2008 and the Community Infrastructure Regulations 2010 (the CIL Regulations). Reliefs and exemptions apply, including an exemption for those looking to self-build a new home, subject to meeting certain conditions. Failure to satisfy all conditions leads to loss of the exemption. Here, the developer had to revise the development during construction due to issues only arising after commencement, and then discovered that a part-retrospective application to authorise development under TCPA 1990, s 73A did not fulfil the conditions for an exemption to apply. CIL of almost £120,000 thus became due.

Gardiner v Hertsmere Borough Council [2021] EWHC 1875 (Admin)

What are the practical implications of this case?

The court confirmed that the self-build exemption under the CIL Regulations does not apply to a retrospective or part-retrospective permission under TCPA 1990, s 73A.

The self-build exemption is in the CIL Regulations, SI 2010/948, regs 54A54D. The self-builder must be building the home themselves, or commissioning it, and must occupy it as their only or main residence following completion. But the problem here arose from a combination of factors.

The development (partial demolition of a dwelling and an extension) was commenced under a permission which was exempt from CIL under the local planning authority’s (LPA’s) own Policy, which did not apply to residential extensions. During the demolition phase however, LPA officers on a site visit formed the view that the demolition works went beyond those works authorised by the planning permission.

The self-builders submitted a new planning application to regularise the demolition work already undertaken (ie the retrospective part of the development) and to permit what would now be the rebuild of, as opposed to merely extending, the house. Planning permission was thus granted pursuant to TCPA 1990, s 73A for the demolition and the erection of a new detached six-bedroom dwelling.

Although TCPA 1990, s 73 applications to carry out development without compliance with conditions previously attached may in certain circumstances allow a self-build exemption to carry over to the new permission, this does not apply (for the reasons clearly set out at paras [47]–[58] of the judgment) to permission granted under TCPA 1990, s 73A (which permits development already carried out). By the CIL Regulations, SI 2010/948, reg 7(5) such a permission is deemed to commence on the date when the planning permission was granted, so it is impossible in these circumstances for the self-builder to comply with the obligation to serve notice of commencement on the LPA before commencing the development.

What was the background?

The applicant in this case obtained planning permission for the partial demolition and an extension of an existing chalet bungalow in Radlett. By the LPA’s own policy, residential extensions were exempted from liability to CIL. At this stage, there was no liability to CIL and no need to seek a self-build exemption.

Work was commenced. During the demolition work, the applicant’s builder and the building control officers, discovered that the foundations of the house were insufficient to support the extension. The foundations required strengthening and additional walls needed to be removed and rebuilt. This work was undertaken to ensure the property was structurally sound.

At a site visit thereafter, the LPA’s planning officers visited the site and decided that the demolition works went beyond what was authorised by the planning permission. They required that building works cease and asked the applicant to submit a new planning application to regularise the demolition and the rebuild of the property. The applicant didn’t accept the LPA’s analysis but he complied with the request.

After applying for the new planning permission, the applicant became aware that the LPA now considered that the development would be liable to CIL as the rebuild would be treated as a new dwelling.

The applicant thus sought to rely on the self-build exemption. He argued that if a self-build exemption can only be obtained after the grant of planning permission, then it is impossible for a self-builder to ever obtain the self-build exemption when retrospective planning permission is necessary. This outcome is manifestly unfair, and it cannot have been the purpose or intent of the CIL Regulations.

The LPA and the Secretary of State argued that the fact that the exclusion of the exemption from retrospective application under TCPA 1990, s 73A was a deliberate decision on the part of those drafting the CIL regulations; it has an identifiable purpose and it accords with the legislative provisions.

What did the court decide?

Mrs Justice Thornton’s judgment is clear and straightforward. She said (at para [68] of the judgment):

‘…it is not possible to claim the CIL exemption for self-build housing where chargeable development is first authorised by a retrospective planning permission granted pursuant to s.73A of the Town and Country Planning Act 1990.’

Thornton J (para [67] of her judgment) quoted with approval the following passage from Cape Brandy Syndicate v IRC [1921] 1 KB 64 at para [71]:

‘…in a taxing Act one has to look merely at what is clearly said. There is no room for any intendment. There is no equity about a tax. There is no presumption as to a tax. Nothing is to be read in, nothing is to be applied. One can only look fairly at the language used.’

Accordingly, the claim was dismissed.

Case details
  • Court: Planning Court, Queen’s Bench Division, High Court of Justice
  • Judge: The Hon Mrs Justice Thornton DBE
  • Date of judgment: 6 July 2021

For further information on any of this points raised in this article please contact Jim Ryan.

This article was first published by LexisNexis UK.

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