Khodari, R (on the application of) v Cedarpark Holdings Inc

Whether a building has sufficient heritage significance to merit consideration as a non-designated heritage asset is a planning judgment for the local planning authority. Formal identification is not essential where the authority has substantively considered the building’s significance and relevant features.

Loss of internal features may be a material consideration where it is integral to development requiring permission, even if the alterations themselves do not require permission. A Town and Country Planning Act 1990 planning obligation must regulate the use of the relevant land. Parking-permit covenants regulate neither the flats nor the highway under section 106. However, such obligations may be valid under a separate statutory power. Under section 16 of the Greater London Council (General Powers) Act 1974, “in connection with the land” has a wide meaning.

Mr and Mrs Khodari, leaseholders of a flat, challenged two planning permissions for the internal reconfiguration of their building. They alleged that the local planning authority had failed to consider the building as a non-designated heritage asset and had ignored the loss of important internal features.

They also challenged permit-free obligations attached to the first permission. The High Court rejected the heritage challenge but upheld the challenge to the parking obligations and quashed the first permission. The Council appealed against that order, while Mr Khodari appealed against the refusal to quash the second permission. The central issues concerned heritage assessment, the scope of section 106 of the Town and Country Planning Act 1990, the availability of section 16 powers, and the treatment of a monitoring fee under regulation 122.

Lord Justice Lewison gave the judgment, with Lord Justices Davis and McCombe agreeing. The Court of Appeal dismissed Mr Khodari’s appeals and allowed the Council’s cross-appeal.

1. Heritage assessment. Whether a building has the degree of significance required to merit consideration as a heritage asset is a planning judgment. For a non-designated heritage asset, that judgment is for the local planning authority. Policy guidance could not itself impose a legal duty to identify the building formally. In any event, the authority had considered the building’s interior, external appearance and heritage significance in the reports and committee debate. No error of law was established.
2. Internal features. Section 55(2)(a) of the Town and Country Planning Act 1990 excluded internal alterations to an unlisted building from development. Nevertheless, loss of internal features could be a material consideration where integral to development that did require permission. The authority had addressed the alleged loss and was entitled to treat its significance and the countervailing housing benefit as matters of planning judgment. The challenges to both permissions therefore failed.
3. Section 106. The Court approved the overall conclusion in Westminster CC v Secretary of State for Communities and Local Government [2013] EWHC 690 (Admin). The references in section 106 to “the land” concerned land in which the person entering the obligation was interested. A parking-permit application concerned use of the highway, not use of the flats or 31 Egerton Gardens. Covenants governing marketing or lease terms did not alter that conclusion. The permit-free obligations were therefore not planning obligations under section 106.
4. Section 16. Section 106 was not a complete code preventing reliance on other statutory powers. Pioneer Aggregates (UK) Ltd v Secretary of State for the Environment [1985] AC 132 concerned a different issue. Section 16 of the Greater London Council (General Powers) Act 1974 required only a connection with the land, and that phrase was wide. The residential use of the additional units was sufficiently connected with the potential grant of parking permits. The permit-free obligations were accordingly valid under section 16.
5. Monitoring fee. The one-off fee fell within the literal scope of section 106(1)(d), but regulation 122 of the Community Infrastructure Regulations 2010 only addressed whether a planning obligation constituted a reason for granting permission. The fee was not mentioned in the report, recommendation or committee debate, so it could not be inferred to have been such a reason. In any event, if section 106 did not apply, the original parties were bound contractually, with power supplied by section 111 of the Local Government Act 1972 or section 1(1) of the Localism Act 2011.

• Court of Appeal (Civil Division) — [2017] EWCA Civ 333: dismissed Mr Khodari’s appeals and allowed the Council’s cross-appeal.
• High Court of Justice, Queen’s Bench Division, Planning Court — HHJ Sycamore: rejected the heritage challenge, upheld the challenge to the permit-free obligations, and quashed the first planning permission.