No mandatory planning refusal for out-of-town retail and leisure development

Last week the Court of Appeal rejected an appeal challenging Leeds City Council’s grant of planning permission for a development in an ‘edge of centre’ development. The Court of Appeal had to consider the correct interpretation of paragraph 90 of the National Planning Policy Framework (NPPF).

What does paragraph 90 say?

Paragraph 90 is aimed at protecting the existing retail facilities in existing town centres. It requires that planning authorities refuse planning permission for applications for retail units that are on edge of town or out of town if they either fail to satisfy a sequential test or if the application is likely to have significant adverse impact on existing, committed or planned investment in the town centre, or on the town centre’s vitality and viability.

Leeds Council’s interpretation

The application was for a Lidl and B&M Homestore some 70m outside the identified town centre.

Despite a recommendation of refusal from the Council’s planning professionals (based on the application being contrary to the Council’s centre first policy), the Council’s planning committee approved the planning application.

The issues the members highlighted included the opportunity for employment, economic impact, the site’s location on the edge of the centre (and the excellent links allowing trips between the existing centre and the proposed development site), and the opportunity to extend the centre.

What did the Court of Appeal decide?

Asda challenged the decision, arguing that in granting permission the Council had misinterpreted paragraph 90 by failing to recognise that it contains a “presumption” against development that would have a “significant adverse effect” on the “vitality and viability” of a town centre.

Setting out its approach to the interpretation of the NPPF the Court noted that the NPPF “is not the work of those who draft statutes or contracts, and does not always attain perfection”. The language of planning policy is usually less precise, and interpretation relies less on linguistic rigour. The Court will ‘seek to draw from the words used the true, practical meaning and effect of the policy in its context, bearing in mind that the purpose of planning policy is to achieve “reasonably predictable decision-making, consistent with the aims of the policy-maker”, it will look for an interpretation that is “straightforward, without undue or elaborate exposition”’.

The Court of Appeal held that paragraph 90 did not provide for a mandatory refusal, stating that ‘The words “should be refused” have a clear meaning, which requires no elaboration by the court. They do not mean “must be refused”. The policy is not imperative. It does not dictate a refusal of planning permission whenever the development proposed is likely to have a “significant adverse impact” on the “vitality or viability” of a town centre.’ It went on to say that ‘implicit in policy of this kind…is the need for planning judgment to be exercised in its application.’

In this case, it was clear that those who made the decision to grant planning permission made that decision conscious of the terms of paragraph 90. The policy thus played a part in the decision-making process.

What is the impact of the decision?

In this case, Asda was unable to prevent a competing development from proceeding because the local planning authority had exercised planning judgment lawfully.

Owners of existing town centre retail units are unlikely to take comfort from this decision as it confirms a more flexible approach to town centre first planning policies can be acceptable. Whereas retail developers looking for new opportunities outside the defined town centre will be more encouraged by the decision.

Local planning authorities need to ensure that they are aware of their obligations in relation to the protection of town centres as described in paragraph 90, and that they keep accurate and full minutes of meetings recording their decisions.