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Planning Inspectorate Blunder Triggers Test Case

In a bitter illustration of the vagaries of the planning system, a developer whose hopes of being allowed to build up to 180 new homes in a Wiltshire village were first raised – but then dashed due to an administrative error by the planning inspectorate – has failed in a unique compensation bid.

HouseGleeson Developments Limited was popping the champagne corks when it was told that a Government inspector had decided to grant outline planning permission for the development on the outskirts of Malmesbury. However success was turned to ashes the very next morning when the company was informed that, due to a crossing of official communications, the decision had been issued ‘in error’.

It turned out that, less than three hours before Gleeson was given the good news, the Minister for Planning had ‘called in’ the company’s application for personal determination by the Secretary of State for Communities and Local Government. The inspector’s decision was swiftly withdrawn but the bitterly disappointed developer took its complaints to the High Court.

The company’s lawyers insisted that the inspector’s decision had become valid and enforceable the moment that it was officially issued and that the only way of undoing the error was to formally revoke the planning consent and pay Gleeson substantial compensation. The Minister’s eleventh-hour decision – which came after it had earlier been announced that the Secretary of State was happy to leave the final decision to the inspector – was also ‘irrational’, it was submitted.

However, dismissing the developer’s challenge, the Court found that it could not have been Parliament’s intention to make it impossible for the planning inspectorate to put right such a ‘simple and obvious’ administrative mistake. The Minister had decided to intervene before the inspector’s decision was mistakenly released and the Court ruled that, ‘as a matter of basic principle’, the latter had been issued without authority and had no legal effect.

The Court also rejected Gleeson’s plea that the failure to consult it before the ‘call-in’ decision was made was fundamentally unfair. The Minister had decided to intervene in the light of the substantial size of the development and the recent publication of a draft neighbourhood plan for the area.

Noting that the planning inspectorate had acted immediately once the mistake was spotted, the Court found that ‘good administration’ demanded that a ‘modest power’ to withdraw decisions issued in error had to be implied into the relevant legislation. Gleeson’s arguments that it had a ‘legitimate expectation’ that planning permission had been granted and that the decision’s withdrawal amounted to a breach of its human rights were also dismissed. However, the Court noted that the company remained entitled to a ‘fair determination’ of its planning application by the Secretary of State in the light of the inspector’s recommmendations.