Working Title Films Ltd, R (on the application of) v Westminster City Council & Anor

Community Infrastructure Levy Regulations 2010, regulation 122, makes necessity, direct relation, and fair and reasonable relation in scale and kind legal tests for planning obligations. It changed the earlier position under which necessity was a matter of planning policy rather than law. An obligation may be necessary where it secures a community benefit that counterbalances a shortfall in affordable housing. The decision maker may weigh those competing benefits as matters of planning judgment. A council’s ability to charge for use, or the range of permitted community uses, does not by itself make the obligation unacceptable. The authority must still have regard to the development plan and all material considerations.

Working Title Films Ltd, a neighbouring occupier, challenged Westminster City Council’s grant of planning permission to Moxon Street Residential (Luxembourg) SARL for a mixed-use development including housing, a community hall and other facilities.

Permission to apply for judicial review was initially refused by Hickinbottom J and refused on renewal by Ouseley J, who ordered a rolled-up hearing. The only surviving ground concerned a Town and Country Planning Act 1990 section 106 obligation requiring the community hall to be provided and leased to the Council at a peppercorn rent. The issue was whether that obligation satisfied regulation 122 of the Community Infrastructure Levy Regulations 2010, particularly the requirement of necessity.

Permission to apply for judicial review was refused.

1. Effect of regulation 122. Regulation 122 of the Community Infrastructure Levy Regulations 2010 imposed legal tests concerning necessity, direct relation, and fair and reasonable relation in scale and kind. Before its enactment, necessity was a matter of policy rather than a legal test of materiality. The earlier position was illustrated by R v Plymouth City Council ex p Plymouth and S Devon Co-op Society Ltd [1993] 67 P and CR 78 and Tesco Stores v Environment Secretary [1995] 1 WLR 759. The judge accepted that R(Hampton Bishop PC) v Herefordshire Council [2014] EWCA Civ 878 recognised partial codification, but rejected the approach in Welcome Break Group and Others v Stroud DC and Gloucestershire Gateway Ltd [2012] EWHC 140 and Oxfordshire CC v SSCLG and others [2015] EWHC 186 (Admin) insofar as they treated the previous law as continuing unchanged.
2. Application of the tests. The community hall formed part of the development and the section 106 arrangements secured its effective use and management. The obligation was therefore directly related to the development and fairly and reasonably related in scale and kind. It was also necessary in the statutory sense because the community benefit provided a countervailing benefit against the reduced level of affordable housing. The assessment involved matters of weight and planning judgment for the Council.
3. Use and revenue objections. The possibility that the Council might charge for use, or that the hall might be used for activities within Classes D1 or D2, did not create a planning objection. The same uses could have been carried on by another lessee, and the Council’s control supported the proper provision of community facilities.
4. Planning duties. Under sections 70 of the Town and Country Planning Act 1990 and 38(6) of the Planning and Compulsory Purchase Act 2004, the Council had to have regard to the development plan and material considerations and determine the application in accordance with the plan unless material considerations indicated otherwise. No failure in those duties was established.