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Understanding the impact of the changes to the planning costs circular

The latest Planning costs circular 03/2009 (the Circular) supersedes the previous cost circular 8/93 and relates to the costs regime in planning appeals and other planning proceedings under the Planning Acts.

Whilst it may appear that there are few changes, scratch beneath the surface and there are a number of key principles which will not only change the way in which planning appeals are conducted but the planning system generally.   This article looks at some of these changes and how they will impact upon the planning system.

Paragraph A12 of the Circular sets out 3 conditions that need to be satisfied before costs can normally be awarded.  Those conditions are as follows:-

“1.        a party has made a timely application for an award of costs.

2.         the party against whom the award is sought has acted unreasonably; and

3.         the unreasonable behaviour has caused the party applying for costs to incur unnecessary or wasted expenses in the appeal process – either the whole of the expense because it should not have been necessary for the matter to be determined by the Secretary of State or appointed Inspector, or part of the expense because of the manner in which a party has behaved in the process”.

However, different conditions apply to compulsory purchase and orders where the making or confirmation takes away from the objector some right or interest in land for which the statute gives them a right to compensation.  In summary objectors that are defending their rights or protecting their interests which are the subject of such orders will normally be entitled to costs where their objection is successful.

Until this point one might think that there is no real change from the previous cost circular.  However, it is clear from paragraph A25 of the Circular, that cost applications may relate to what happened before the appeal was lodged, provided those events are related to the appeal itself.  This will enable parties to refer not only to events that have happened during the application stage but also where appropriate to events pre-dating the application itself for example pre-application discussions, provided those events have resulted in costs being unnecessarily and unreasonably incurred in the appeal process.

The Circular will almost certainly trigger further debate on the issue of target dates.  Local Planning Authorities (“LPAs”) already have a difficult job in determining planning applications within set target dates.  In the event that a target date is not going to be met it is not unknown for a LPA to require applicants to withdraw and re-submit their application.  Of course, if the LPA does not determine the application then the applicant has six months from the date in which the application should have been determined (i.e. from the target date or later date as expressly agreed between the parties) but with this comes additional costs.  Paragraph B11 expressly provides that in an appeal against non determination the authority should explain its reasons for not reaching a decision within the relevant time period and that LPAs may be at risk of an award of costs if it is concluded that there were no substantive reasons to justify delaying the determination and a greater level of communication with the applicant would have enabled the appeal to be avoided all together.   LPAs will need to ensure that where applications are not determined within the set target dates there are adequate reasons to justify this.  To limit its exposure to costs, LPAs would be well advised to inform the applicant of any delay together with reasons to justify that delay and agree an extension of time with the applicant at the earliest possible opportunity.

LPAs will also need to be careful when it comes to determining applications, particularly where the decision is contrary to officer’s recommendations.  Where officer’s recommendations are not followed LPAs will need to show reasonable planning grounds for taking a contrary decision and produce evidence on appeal to support the decision in all respects – if they fail to do so, costs may be awarded against them.  No real change here then but the Circular goes further: paragraph B21 states that whilst LPAs are expected to consider the views of local residents when determining a planning application, the extent of local opposition is not, in itself, a reasonable ground for resisting development.  Moreover, paragraph B22 warns LPAs that they will be at risk of an award of costs for unsubstantiated objections where they include valid reasons for refusal but rely almost exclusively on local opposition from third parties through representations and attendance at an Inquiry or Hearing, to support the decision.

The Circular actively encourages pre-application discussions consistent with paragraph 12 of PPS1 and liaison throughout at both application and appeal stages.  Parties should also regularly review their cases and if an argument is no longer sustainable then that party should inform the other side as a matter of urgency to minimise its exposure to costs.

Another real concern for LPAs is contained within paragraph A23.  This provides that where a party had indicated an intention to apply for costs and has clearly set out the basis for the claim, their case would be strengthened if the opposing party was unable to explain why the relevant facts or matters referred to have not led to a change of stance or position.  Whilst this applies to both parties, applicants could use this as an aggressive tactic to put the LPA on notice of its costs at an early stage of the appeal process to cause the LPA to re-evaluate the strength of its case.  These tactics could even be used during the application process if events have taken place, which on appeal would result in costs being unnecessarily and unreasonably incurred.

However, it is not just LPAs that need to tread carefully.  Applicants are also required to act responsibly.  The Circular makes it clear that the appeal system should not be used as bargaining tactics and should not be entered into without first considering a re-submission.  To do otherwise will expose an applicant to an award of costs.

The Circular goes further, requiring applicants to be confident in their case without commissioning substantial new evidence which was not made available to the LPA at the time of their consideration of the planning application.  The Circular states that an applicant who acts otherwise will risk an award of costs for unreasonably introducing such evidence if, in dealing with it, the LPA incurs additional expense which would not have been incurred if the evidence was made available at the application stage.  Those advising applicants will not only need to carry out a full review of the planning merits and their case strategy but also the evidence needed to make the application as robust as possible from the outset.

Also, before submitting an appeal, an applicant will need to consider the strength of the application in the context of the decision that it is appealing against and whether it needs to commission any substantial new evidence.

This article highlights just some of the points arising out of the Circular.  Although the Circular does not change the general principle that costs in planning cases do not follow the event, it does bring more formality to the appeal process by adopting many of the principles set out in the Civil Procedure Rules 1998.  Those that are fully up to speed with this Circular will not only be able to apply it to the issue of costs but also in the wider context of applications and appeals generally.

(NB For ease of reference “applicant” also includes an “appellant”)

The information contained in this article is for general information purposes only and should not be relied on in isolation without seeking further legal advice that is specifically applicable to your circumstances. To discuss any aspects of this article further, please contact Marco Mauro.
 
© EMW Picton Howell LLP 2009