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Planning Obligations - Practice Note 9

Introduction

The concept of securing off site improvement and/or limiting the way development is carried out following the granting of planning permission by way of an accompanying legal agreement has been a tool of the planning system for some years now. Currently provided for through Section 106 of the Town and Country Planning Act 1990 (as amended) ‘Planning Obligations’ take the place of what were commonly called ‘Section 52 Agreements’ under the 1971 Town and Country Planning Act. Planning Obligations can enhance the quality of a development and enable proposals to go ahead which might otherwise be refused.

Although these obligations are still usually referred to as ‘agreements’ they may be created either by a planning agreement or a unilateral undertaking. An agreement is a deed entered into between the persons interested in the land and the Local Planning Authority; a unilateral undertaking is a deed executed only by the persons interested in the land and delivered to the Local Planning Authority. Both are equally enforceable but it was anticipated that the unilateral undertaking would have more of a role at appeals where the appellant may seek to persuade the Inspector that they can offer some form of ‘planning gain’.

Anyone with an interest in land may enter into a planning obligation and when created they run with the land and are enforceable by the Local Planning Authority.

The preparation of obligations is usually undertaken by the Local Authority in negotiation with the applicant and this process can be complex and time consuming especially if there are a number of signatories.

This practice note is intended to explain in simple terms the legal context within which obligations can be drawn up and the Wyre Forest procedures for handling such obligations.

Legal Position

Section 106 of the Town and Country Planning Act 1990 (as amended) makes provision that “any person interested in land in the area of a local planning authority may, by agreement or otherwise, enter into an obligation-

  • restricting the development or use of the land in any specified way
  • requiring specified operations or activities to be carried out in, on, under or over the land
  • requiring the land to be used in a specified way
  • requiring a sum or sums to be paid to the authority on a specified date or dates periodically.”

It is a fundamental legal principle that planning permissions should be neither bought nor sold. If a developer passes money or some other benefit to the Local Planning Authority or local community when planning permission is granted, then that money or benefit must be related to the planning permission. The term ‘planning gain’, although often used, has no statutory significance and is not found in the Planning Acts.

Circular 05/05: ‘Planning Obligations’ provides further guidance on how such obligations should operate and the broad principles that should be adopted. Particularly the Secretary of State requires planning obligations to be sought only where they meet the following tests:

  • necessary to make the proposed development acceptable in planning terms
  • relevant to planning
  • directly related to the proposed development
  • fairly and reasonably related in scale and kind to the proposed development
  • reasonable in all other respects

Section 106A of the Act provides that an obligation may not be modified or discharged except by agreement with the local planning authority. However, after a period of five years from the date at which the obligation was entered into a formal application may be made to the authority to modify or discharge an obligation. If this is refused Section 106B provides for the right of appeal against this decision to the Secretary of State.

Guidance on this is provided by the Town and Country Planning (Modification and Discharge of Planning Obligations) Regulations 1992.

The Development Plan policies underpin requirements for planning benefit. Section 54a of the Act requires planning applications and appeals to be determined in accordance with the development plan unless material considerations indicate otherwise. Therefore, an up to date development plan requiring a particular benefit in connection with development, in the absence of any other material considerations, should secure that benefit.

Circular 05/05 emphasises that planning obligations are entered into in the public interest and that they should be open to public participation. This ties in with the emphasis on the transparency of decision making and negotiations should therefore be conducted in a fair, open and reasonable way.



Wyre Forest District Council