Costs Decision

Hearing and site visit held on 7 March 2012 by Paul Jackson B Arch (Hons) RIBA
an Inspector appointed by the Secretary of State for Communities and Local Government Decision date: 26 March 2012

Costs application in relation to Appeal Ref: APP/X5210/A/11/2158085

Summary of Decision: The application is allowed in the terms set out below in the Formal Decision and Costs Order. The Submissions for the Appellant 1. A written application for a partial award of costs was made prior to the Hearing. This was elevated to a claim for a full award at the event. 2. The Council has prevented development which could reasonably be permitted in light of the development plan and any other material considerations. An overwhelming array of policies supports the scheme on an objective basis. To refuse it was unreasonable. 3. The Council has failed to produce evidence to substantiate each reason for refusal and why it is unacceptable. Moreover, information contained in the case file concerning viability was unreasonably withheld from the appellant before the Hearing. The Response by the Council 4. A written response by the Council to the partial costs application was made and I have taken it into account. 5. At the Hearing, the Councils representative stated that the Council had clearly set out its position with clear and concise reasons for refusal. The Council was entitled to take a different view to its officers. Conclusions 6. I have considered this application for costs in the light of Circular 03/09 and all the relevant circumstances. This advises that, irrespective of the outcome of the appeal, costs may only be awarded against a party who has behaved unreasonably and thereby caused another party to incur or waste expense unnecessarily.

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7. The refusal notice advises the appellant that entering into a S106 legal agreement would overcome reasons for refusal 2 to 8 relating to loss of employment space, the addition of new units leading to additional affordable housing, environmental sustainability measures, withdrawal of residents parking permits and contributions to education and public open space. Reason for refusal reason 1 concerns the contribution to affordable housing of 815670 on implementation which was defended at the Hearing, as opposed to a deferred contribution subject to a post completion viability test which had been supported by officers. 8. No plausible defence was offered at the Hearing to explain why the Councillors refused the application on this ground, in the light of the independent viability advice which was carried out on their behalf. There had been no significant change in circumstances since the application had been made. Paragraph B16 of the Circular advises that planning authorities are at risk of a costs award against them if they cannot show evidence at the appeal stage to substantiate each reason for refusal. No Councillors from the development control committee appeared to defend the decision. The Council now seek to rely on missing information and pick holes in the valuation carried out by Savills and the building cost estimates. Assertions are made that residential prices are likely to grow in the future. That may or not be the case. If there were serious matters that were considered fatal to the valuation, they should have been identified earlier. The fact that at various points, in an effort to move the project along, the appellant or another agent was willing to provide an initial cash contribution towards affordable housing is beside the point where costs are concerned. As far as I can ascertain, none of these factors, obtained in hindsight, were available to the development control committee. In the terms of the Circular, there was no respectable basis for the Councils stance. 9. In any development activity, there is an element of risk for the developer. In considering the viability assessment and commissioning a separate independent report, the Council also takes on a risk that if permission is granted, profit margins may not actually be reached and the affordable housing element reduced or avoided. Nothing placed before me suggests that any of the parties behaved unreasonably in the negotiation process leading up to the committee meeting. 10. I conclude that the refusal on this ground was unreasonable behaviour which caused the appellants unnecessary and wasted expense in dealing with it at the appeal. In considering this matter, I have taken into account the chain of email correspondence between the appellant and Council officers prior to the committee decision and the advice that the recommendation was finely balanced and that members might not agree. However the officers report only introduces the phrase on balance in the section on affordable housing, indicating compliance with development plan policies in all other respects. There is no reference to any balance in the final recommendation, let alone a fine balance. The contribution of the scheme to the supply of housing in the Borough is the main point emphasised and this is the priority land use objective of the development plan. I have not been advised of anything to indicate that the deferred contribution route was not a reasonable approach to the affordable housing required, given the uncertainties that attach to

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refurbishment schemes and the market generally. It was also an approach the Council had adopted when considering another application in Sidmouth Street. 11. With regard to the employment land issue, no plausible argument was deployed at the Hearing in defence of the Councils position, in the light of the officers recommendation and the requirements of CS, DP and Camdens Planning Guidance. Whilst there is always an element of planning judgement involved, the recommendation that the change of use complied with employment policy was not ambivalent. The doubts now expressed by the Council on the veracity of the marketing information and the state of the office letting market were not before Councillors on the development control committee. I conclude that insufficient grounds have been shown for taking a decision contrary to officers professional advice. This was unreasonable behaviour that caused the appellant unnecessary costs. The reason for refusal includes the lack of replacement provision for employment training, but that was to form part of the S106 agreement/undertaking and had already been agreed following negotiations with officers. 12. Turning to the information from the case file allegedly withheld from the appellants agent, this concerned information from the Councils independent viability assessment (paid for by the appellant) which the Council deemed to be commercially sensitive. The exact circumstances remain vague. According to the Council, the information was finally released after a Freedom of Information request but after the appellants agent had made a fruitless visit to London. In my view the visit was reasonably necessary in view of the Councils statement of case and written costs response. Notwithstanding the sequence of events, it should be included in the time spent in preparing for the Hearing. 13. The other issues were in the process of negotiation as part of a S106 Agreement at the time the appeal was made. I do not doubt that if the appeal against non-determination had not been submitted, they would have reached a satisfactory conclusion. The record of correspondence shows a relatively high level of realistic negotiation between officers and the appellants agent who does not demur from the necessity to make the necessary contributions. They were not in contention at the appeal. 14. However the Councils unreasonable behaviour in relation to the issues of affordable housing and employment land justifies a full award of costs, as the Hearing would not have been necessary otherwise. Formal Decision and Costs Order 15. In exercise of my powers under section 250(5) of the Local Government Act 1972 and Schedule 6 of the Town and Country Planning Act 1990 as amended, and all other powers enabling me in that behalf, I HEREBY ORDER that the Council of the London Borough of Camden shall pay to Westrock Ltd, the costs of the appeal proceedings. The proceedings concerned an appeal under section 78 of the Town and Country Planning Act 1990 as amended against the refusal of planning permission for change of use of B1A office (basement & 1st to 5th floors) to 18 units of C3 housing together with ancillary works at 44 Bedford Row, London WC1R 4LL (this revised description of development agreed prior to the Council making its decision).

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16. The applicant is now invited to submit to the Council of the London Borough of Camden, to whom a copy of this decision has been sent, details of those costs with a view to reaching agreement as to the amount. In the event that the parties cannot agree on the amount, a copy of the guidance note on how to apply for a detailed assessment by the Senior Court Costs Office is enclosed.

Paul Jackson
INSPECTOR