Worcestershire Acutehospitals NHS Trust, R (on the application of) v Malvern Hills District Council & Ors

A planning authority may treat a s.106 obligation as a reason for granting permission only if all three statutory tests in the Community Infrastructure Levy Regulations 2010, reg.122(2), are met. An NHS provider seeking a healthcare contribution must show the existence and amount of a residual funding gap after allowing for NHS funding linked to population growth. Without that evidence, the contribution is not necessary and cannot lawfully be required. Authorities may prioritise essential infrastructure and affordable housing on viability evidence already available. Officer reports may fairly summarise technical advice, and underlying reports need not be disclosed where exempt or irrelevant. Procedural non-compliance with background-paper duties does not automatically invalidate permission; material prejudice and the statutory permission-stage test remain decisive.

The Trust, an NHS provider, sought judicial review of planning permission for a large mixed-use urban extension. It challenged the authorities’ refusal to secure a Town and Country Planning Act 1990 s.106 contribution towards an alleged first-year acute healthcare funding shortfall.

The renewed permission application was heard on a rolled-up basis with the substantive hearing on ground 2. The central issues were whether the authorities failed to investigate viability and competing infrastructure priorities, breached duties concerning background papers, gave adequate reasons, relied on an irrelevant payment model, or misled members about GP infrastructure. The court also considered disclosure and whether any procedural breach could have materially affected the outcome.

The renewed application for permission to apply for judicial review was refused on grounds 1, 2, 3, 4 and 6. Ground 5 had been abandoned.

1. Planning obligations. Under reg.122(2) of the Community Infrastructure Levy Regulations 2010, necessity, direct relationship, and fair and reasonable scale and kind are legal requirements. Their application is an evaluative planning judgment subject to Wednesbury review. The court applied the principles in R (Working Title Films Limited) v Westminster City Council [2017] JPL 173, Good Energy Generation Limited v Secretary of State for Communities and Local Government [2018] JPL 1248 and Smyth v Secretary of State for Communities and Local Government [2015] PTSR 1417.
2. Healthcare funding. The Trust had not demonstrated the existence or amount of a residual funding gap after accounting for NHS funding for population growth. The authorities were entitled to examine block-contract arrangements and payment by results. They had not assumed that the Trust could simply change its contracting model. Following R (University Hospitals of Leicester NHS Trust) v Harborough District Council [2023] EWHC 263 (Admin), the contribution could not lawfully be required without establishing necessity under reg.122(2)(a).
3. Reports, inquiries and disclosure. Officers’ reports are read with reasonable benevolence and flexibility and need not record every representation. Technical viability advice may be summarised if the report is sufficiently clear. The Tameside duty leaves the manner and intensity of inquiry to the decision-maker, subject to Wednesbury review. Disclosure in judicial review is exceptional and must be relevant and necessary for fair resolution; material not before the decision-maker cannot be used to establish irrationality.
4. Background papers. The viability appraisals relied on commercially sensitive developer information. The court held that they were exempt under s.100D(4) and Schedule 12A to the Local Government Act 1972. R (Holborn Studios Limited) v London Borough of Hackney [2021] JPL 17 was distinguished because it concerned later national policy. The approach in R (Perry) v London Borough of Hackney [2015] JPL 454 was applied.
5. Effect of procedural breach. A breach of s.100D would not automatically invalidate the permission. The court must consider statutory intention, substantial compliance and material prejudice. In any event, it was highly likely that the outcome would have been the same, so permission was refused under s.31(3D) of the Senior Courts Act 1981. The court also assumed, without deciding, that a common-law duty to give reasons arose, and held that the reasons given were clear and sufficient.

This was a first-instance rolled-up permission hearing. Steyn J had refused permission on paper on grounds 1, 3, 4, 5 and 6 and adjourned ground 2. The present court considered grounds 1, 2, 3, 4 and 6 and refused permission on each.