Primavera Associates Limited v Hertsmere Borough Council

A local planning authority does not ordinarily owe an applicant, its developer, lender or landowner a private-law duty of care merely because it processes and determines a planning application. The planning system is a regulatory scheme operated in the public interest. Statutory powers and the payment of an application fee do not, without more, create an assumption of responsibility.

A duty may arise where the authority creates a danger or separately assumes responsibility through conduct, advice or an equivalent relationship coupled with reliance. The statutory remedy for delay or non-determination is ordinarily an appeal under section 78 of the Town and Country Planning Act 1990. On the facts, no duty arose, and the claim was dismissed.

Primavera owned development land in Hertfordshire and pursued planning applications through Shandler Homes and Fusion. It claimed that Hertsmere Borough Council negligently handled two applications, including by making an unlawful planning decision and delaying the later application. It sought approximately £1.69 million for financing, professional, planning, infrastructure and contribution-related costs.

The central issue was whether the Council owed Primavera a duty of care to process and determine the applications with reasonable skill and care. The claim also raised breach, causation and loss. The judgment considered the statutory planning framework, the right of appeal against non-determination, and the principles governing public-authority liability and assumption of responsibility.

1. Duty of care. The Council did not owe Primavera a duty of care. The statutory planning function is a regulatory function for the public benefit, not a private service supplied to the applicant. The reasoning in Lam v Brennan and Strable v Dartford Borough Council remained applicable.
2. The principles in Michael, Robinson and Poole did not create a special duty simply because a public authority performs statutory functions. A duty could arise from an assumption of responsibility only if the conduct satisfied the Hedley Byrne principles, including reliance. The Council gave no relevant commercial or legal advice, assurance or undertaking. Its communications were part of its statutory functions.
3. The duty was not extended to Primavera, Fusion or the lender merely because the Council knew of their interests or required them to enter section 106 agreements. Those agreements imposed no contractual obligation on the Council to process the applications with care.
4. Shandler Homes had a statutory right of appeal against non-determination under section 78 of the Town and Country Planning Act 1990. It chose not to exercise that right. The claimant therefore assumed the risk of delay and defects in the statutory process.
5. Alternative findings. If a duty had existed, the Council would have breached it by determining the revised first application by reference to superseded planning policy. It would also have been responsible for a six-month delay between January and July 2015. The other allegations of negligence failed.
6. On causation, the Council would probably have granted permission in January 2014 even if it had acted carefully, and there was at least a 60% chance that the neighbour would not have pursued the second judicial review. However, the claimant’s decision not to appeal would have broken the chain of causation for the later delay.
7. The claimed losses were not proved or were recouped from the sale proceeds. The claim was dismissed.