England and Wales Court of Appeal (Civil Division) Decisions

IN THE HIGH COURT OF JUSTICE
COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION, ADMINISTRATIVE COURT
KEITH LINDBLOM QC SITTING AS A DEPUTY JUDGE
C1/2009/1842

		Royal Courts of Justice Strand, London, WC2A 2LL
		29/04/2010

Lord Justice Elias :

1. Mr Peter Bull, the third respondent to this appeal, applied to the second respondent, Rother District Council, acting as local planning authority, for outline planning permission to develop certain land at Wylands International Angling Centre in Catsfield, East Sussex. That application was refused. Mr Bull appealed that decision and there was an inquiry conducted over four days by one of the Secretary of State's inspectors, Mr Paul Jackson, who allowed the appeal.
2. Mr Michael Parker, an adjoining land owner, then appealed under section 288 of the Town and Country Planning Act for an order to quash the decision of the inspector. The appeal was heard by Mr Keith Lindblom QC, sitting as a deputy High Court judge. He considered very extensive grounds of appeal; he rejected all of them and refused permission to appeal. Some of these grounds were then advanced in the application for permission to appeal which was lodged with this court. Sir Richard Buxton refused permission in respect of all of them on consideration of the papers. They were then pursued on an oral renewal of the application before Lord Justice Richards. He gave permission on one ground only, namely whether the inspector had properly construed and applied policy EM10 of the Rother District Local Plan, the statutory development plan. It is trite law that all planning determinations must be in accordance with the development plan unless material considerations indicate otherwise: see section 38(6) of the Planning and Compulsory Purchase Act 2004. So a proper understanding and application of the policy is crucial.
3. The nature of the site on which the development is proposed was identified by the inspector in the following terms (see para 6):

"Wylands International Angling Centre (WIAC) comprises a diversified former mixed farm located in gently undulating landscape north of Bexhill-on-Sea. It comprises around 62 hectares of lakes, grassland and woods. The fishery use has gradually developed over more than 20 years and is supported by the Council as an appropriate leisure use in the AONB. A group of loosely sited buildings, mobile homes and containers of varying appearance near the centre of the holding comprises the former farmstead from which the business is managed. A public footpath (No. 15A) runs through the centre of the holding past the edge of the farmstead."

4. The scheme of development for which permission was granted comprised a number of elements, but the most significant was the erection of 15 cabins for fishermen, with overhanging eaves and verandas, to be constructed in a field adjoining a lake. This was to replace nine touring caravans, and in addition certain other unsightly buildings were to be removed.
5. The inspector noted that outline planning permission had been granted in August 2003 but since no approval of reserved matters had been obtained within three years of that grant, the permission had lapsed in August 2006. However, policy EM10 was not in place when that permission was granted.
6. The inspector set out relevant planning policies between paragraphs 8 and 12 of his decision. He refers specifically at paragraph 11 to policy EM10. This seeks to control and restrict new chalet or static caravan development. The inspector accurately recited this policy which is as follows:

"In the countryside, additional static caravan and chalet accommodation for holiday purposes will not be permitted unless it would result in a significant improvement in the appearance of an existing site or is essential in association with a rural enterprise."

The reason for that policy is explained in the local plan itself as follows:

"In Rother District more than half of all tourist accommodation is provided by static caravans which adds to economic vitality in the District. Nevertheless the Council considers that normally new holiday centres and static caravan sites are inappropriate in the countryside by reason of the visual impact and demand on services and facilities…"

7. I pause to note that there are two distinct bases on which additional accommodation of this nature may be permitted: either it will result in a significant improvement in the appearance of an existing site; or it is essential in association with a rural enterprise. I will refer to these as limbs one and two respectively. An important feature of this policy, which is common ground between the parties, was accepted by the judge below and is not challenged before us, is that the reference to "existing site" is a reference to an existing static caravan or chalet site; it is not simply a reference to any existing site in the broad sense of one on which land has been developed. Nor does it cover a touring caravan site, which is dealt with separately in the plan.
8. Having considered in some detail the nature of the proposed development and its impact on what is an area of outstanding natural beauty, the inspector expressed his conclusions as follows (para 35):

"I conclude that the overall effect of provision of 15 cabins combined with the removal of caravans on the ridge, a new facilities building and workshop/store, combining 2 dwellings into one and providing a new dwelling would be to significantly improve the appearance of the existing site in the AONB and enhance the economic and social well being of the area in accordance with the aims of relevant regional guidance, SP policies and LP policies GD1(v) and EM10; and would conform with the objectives of national guidance contained in PPS7."

In my judgment it is plain that the inspector is concluding that the first limb of the policy is satisfied. He uses the very language of that limb. This is further confirmed by the costs decision, issued on the same day as the main decision, in which he stated in terms that his finding was that the first limb was satisfied.

Grounds of appeal.

9. The appeal raises three inter-related grounds, one of which emerged in the course of oral argument. The principal ground is a submission that when the decision letter is read in the light of the submissions advanced before the inspector, the only reasonable inference is that the inspector has misconstrued the effect of policy EM10.
10. Mr Hill QC, counsel for the appellant, submits that there is every reason to suppose that the inspector did not appreciate that the first limb of the policy was only engaged where the existing site was an existing static caravan or chalet accommodation site. He submits that at least by the close of the inquiry, all the parties - including Mr Bull's counsel - were focusing on whether the development could be brought within the scope of the second limb of EM10; that is, whether it was "essential in association with a rural enterprise". None of the parties were by then placing any significance on the first limb. Mr Hill suggests that this was because it was recognised by them all that the limited original development could not be said to constitute a static caravan or chalet site at all. The inspector appears to have failed to appreciate that fact. Had the inspector focused on the second limb, as he ought to have done, that would have established a far higher hurdle for Mr Bull to meet. It is far from clear that the third respondent would have met it, and the inspector reached no conclusion on that issue.
11. Mr Hill relies upon a dictum of Woolf J, as he then was, in Gransden v Secretary of State for the Environment (1987) 54 P&CR 86, 94 to the effect that a failure by an inspector properly to understand a planning policy is akin to a failure to have regard to that policy.
12. Alternatively, Mr Hill contends that if he is wrong on his first ground, and the inspector did properly understand the meaning of the phrase "existing site" in the policy, then the inspector ought to have given his reasons for concluding that this was such a site. This was an important controversial issue between the parties and an explanation of his reasoning, however brief, was required: see the well known passage of Lord Brown of Eaton under HeywoodH in South Buckinghamshire DC v Porter (No.2) [2004] UK HL33; [2004] 1 WLR 1953, para 36. This is particularly so since the inspector was departing from what was effectively a consensus between the parties that limb one was inapplicable.
13. Finally, he submits that in any event there was no proper basis on which an inspector properly applying this policy could have reached the conclusion that the site was an existing site within the meaning of the policy. This stands as a complaint in its own right but it also reinforces the submission that this inspector must have misunderstood the policy.
14. In the course of his decision, the inspector identified sixteen units of accommodation, comprising nine touring caravans, four chalets, and three static caravans. The nine touring caravans were plainly not static and could not be taken into consideration when assessing whether the site was an existing site within the policy. Mr Hill submits that the three static caravans could not be considered either. Although it seems that they were in fact used for accommodation; that was not lawful use. The site was subject to a caravan site licence which only permitted touring caravans; furthermore, although there was a lawful development certificate issued in 2000 allowing the three static caravans to remain on site, that was only for the purpose of being stored and not in order to provide accommodation. Finally, there was an enforcement notice issued in 1999 (which in fact resulted, following negotiations, in the issuing of the lawful development certificate) which made plain the council's objection to further development.
15. As to the chalets, Mr Hill submitted that the existing accommodation provided by the conversion of the cowshed was not properly to be described as chalets within the meaning of the policy. This was not the kind of accommodation to which policy EM10 was directed. Such adaptation of existing buildings for tourism is encouraged by a different part of the policy, namely policy EM3, provided at least that certain conditions are met. The creation of these four units, for which planning permission was given in 1986, did not create or add to the visual blight that the policy EM10 was designed to curb.
16. Given these considerations, Mr Hill submits that not only is it impossible in the absence of reasons to understand how the inspector reached the decision that this was an "existing site", but no inspector applying the policy to the facts could properly have reached this conclusion. There was no evidential basis for finding that this site was an existing site since there were no relevant static caravans or chalets.
17. Counsel for the Secretary of State, Mr Warren, and counsel for the third respondent, Mr Stoker, made common cause in rejecting the contention that there was a clear consensus that the first limb was inapplicable. They submit that the issue whether the development could be justified by the first limb of EM10 was very much before the inspector. It was certainly an issue on which the parties were divided, but there was no reason to suppose that the inspector had not properly understood the policy.
18. Furthermore, it could not be said to have been Wednesbury unreasonable for the inspector to have formed the view that the first limb of the policy was satisfied. They both rejected Mr Hill's submission that the existing chalets were not of the kind envisaged in the policy simply because they resulted from the conversion of a cow shed. What constitutes a chalet, and whether there were sufficient of them to justify the conclusion that this was an "existing site" within the meaning of the policy, was par excellence a matter of judgment for the inspector. The only basis of challenge would be Wednesbury but, as the judge below had rightly concluded, there was no possible basis for saying that the inspector's conclusion that the first limb was satisfied was an irrational one. The appellant is trying to reopen the merits of the case, which is wholly contrary to established principle: see, for example, the decision of Sullivan J, as he was, in Newsmith Stainless Ltd v SSETR [2001] EWHC Admin 74.
19. The position with respect to the static caravans is more controversial. Mr Warren submitted that since in fact the static caravans were being used for accommodation, it mattered not whether that involved lawful use or not. The inspector was simply concerned with the existing site; if static caravans were used for accommodation, they were material to the assessment of the site, even if they should not have been. Moreover, at the time the inspector visited the site and made his decision, there was no evidence that the council were intending to enforce the enforcement notice and bring that use to an end. The issue of legality of use was a factor to which the inspector could have regard, but it did not prevent him from treating the static caravans as potentially relevant to the assessment he had to make.
20. More fundamentally, Mr Warren submitted that even if the inspector had been wrong to have regard to the caravans, the chalets on their own provided a justification for his decision. The policy leaves it entirely to the inspector to decide how many chalets are relevant to bring it within the concept of "existing chalet site", and an inspector could properly form the view that four was enough. Indeed, Mr Warren submitted that it would be surprising if four were not considered enough (although he did not say that so to hold would be a perverse decision.).
21. Mr Stoker took a different position with respect to the static caravans. He agreed with Mr Hill that the inspector could not properly have regard to them when determining whether the site was an existing site. He accepted that the policy envisaged that the provision of the accommodation must be in accordance with permitted land use. But he too submitted that the chalets taken on their own were a proper and adequate basis for the decision of the inspector.
22. As for the lack of reasons, both counsel submit that the reasoning is obvious enough from the facts. Reading the decision fairly and as a whole, it is clear that the inspector thought that limb one was applicable, and that inevitably involved a finding that the original site was an "existing site" within the meaning of the policy. The only possible basis on which the inspector could have reached that conclusion was by accepting that chalets and/or the static caravans on site were such as to give the site that status. The inspector was not required to set out the parties' contentions on that issue. Even if, contrary to their submissions, there was a consensus and the inspector had departed from it, that was his prerogative: see the observations of Lord Widgery CJ in Kentucky Fried Chicken (GB) v SSE (1977) 245 EG 332. Furthermore, he had the advantage of having visited the site.
23. Like the appellant, the respondents also relied upon the well known observations of Lord Brown in Porter at paragraph 36, although focusing on different parts of that paragraph. Lord Brown said this:

"The reasons for a decision must be intelligible and they must be adequate. They must enable the reader to understand why the matter was decided as it was and what conclusions were reached on the "principal important controversial issues", disclosing how any issue of law or fact was resolved. Reasons can be briefly stated, the degree of particularity required depending entirely on the nature of the issues falling for decision. The reasoning must not give rise to a substantial doubt as to whether the decision-maker erred in law, for example by misunderstanding some relevant policy or some other important matter or by failing to reach a rational decision on relevant grounds. But such adverse inference will not readily be drawn. The reasons need refer only to the main issues in the dispute, not to every material consideration. They should enable disappointed developers to assess their prospects of obtaining some alternative development permission, or, as the case may be, their unsuccessful opponents to understand how the policy or approach underlying the grant of permission may impact upon future such applications. Decision letters must be read in a straightforward manner, recognising that they are addressed to parties well aware of the issues involved and the arguments advanced. A reasons challenge will only succeed if the party aggrieved can satisfy the court that he has genuinely been substantially prejudiced by the failure to provide an adequately reasoned decision."

24. Counsel emphasised Lord Brown's comment that the degree of particularity in the reasons depends upon the nature of the issue, and also his observation that the lack of reasons must leave the reader to whom the decision is addressed in "substantial doubt" as to whether the decision maker erred in law.
25. Here, counsel submit, it was plain both that the inspector had found this site to be an existing site within the meaning of the policy, and why he had done so. It was obvious that he must have had regard to the accommodation on the site to justify his conclusion, and a statement to that effect in the decision letter was not required. Even if it would have been desirable to have said a little more - and in truth it would only have been stating the obvious - there was no prejudice to the appellant in failing to do so, let alone the substantial prejudice which Lord Brown said was necessary for a reasons challenge to succeed.

Discussion.

26. In order to resolve the issues raised in this appeal, it is relevant briefly to summarise the way in which the case was presented to the inspector by the parties with respect to policy EM10.
27. The appellant's planning witness, Mr Frall, unambiguously expressed the view that there was no existing chalet or static caravan site at Wylands and accordingly "the test of essential need is therefore to be applied". He was therefore unequivocally asserting that if the policy under EM10 was to be complied with, the stricter test under limb two had to be satisfied rather than the requirements in limb one.
28. The developer's written evidence was to the contrary. His planning expert, Mr Taylor, gave evidence that in his view the scheme complied with EM10, both because it would result in a significant improvement in the appearance of an existing site and also because there was an essential need for the facilities. He later expanded upon this submission, saying:

"The proposal to replace the unsightly and conspicuously located touring caravans with small cabins would improve the appearance of the site. Just on this count, the proposal accords with policy EM10."

It is right to say, however, that he does not in his written evidence state in terms that the reference to "existing site" must mean an existing static caravan or chalet site.

29. The council's planning expert, Mr Fyfield, identified policy EM10 as directly relevant to the scheme but he was perhaps less certain than the appellant whether limb one was potentially applicable or not. He said:

"No information has been submitted with the application to indicate how the development would result in a significant improvement in the appearance of the existing site."

and he expressed his own view that it would not do so. This assessment involves an assumption that the first limb is in principle applicable, and that could only be on the basis that the original site was an "existing site" within the meaning of the policy. But he then appears to have suggested that this was irrelevant in any event. He said this:

"Moreover, as the lawful development certificate site is a touring caravan site not a static one, the first part of policy EM10 does not apply."

His position therefore seems to have been that the policy was not applicable, but he was riding both horses in case it might be thought that it was.

30. The parties returned to the issue in their closing submissions. The appellant's counsel again reiterated that Wylands was not a static caravan or chalet site, and he asserted that although Mr Taylor, Mr Bull's planning expert, had sought to assert in cross examination that his primary position was that limb 1 rather than limb 2 applied, that was disingenuous. Mr Taylor had, said counsel, principally based his case on limb 2 and indeed had in cross examination come close to conceding that Wylands was not an existing static caravan or chalet site within the meaning of the policy.
31. This assertion gained some support from the fact that in my judgment, reading Mr Stoker's closing submissions to the inspector as a whole, he did indeed focus significantly on the essential need test in limb two rather than the limb one test. However, Mr Stoker points out that he was also at pains to demonstrate that there would be a significant improvement in the site precisely in order to establish compliance with limb 1.
32. What this evidence does demonstrate, in my view, is that the inspector must clearly have appreciated that there was an issue as to whether or not it could be said that this was an "existing site" within the meaning of the policy. The appellant, and to some extent the council too, were emphasising that limb one of the policy could not apply precisely because it was not an existing site. They said that in terms.
33. By contrast, Mr Bull was contending that both limb 1 and limb 2 potentially applied, albeit that by the closing submissions I think it is fair to say that limb 2 had taken centre stage in his counsel's submissions.
34. Accordingly, I am not prepared to accept that the inspector was unaware that there was an issue whether this site was an "existing site" within the meaning of the policy. It would have been perfectly obvious to him that the appellant and the council were focusing on the more rigorous requirement of limb 2 precisely because it was their submission that this was not an existing site within the meaning of the policy so as to bring the first limb into play. That argument would have been unsustainable if existing site could be widely construed so as to mean any developed site. The only sensible inference is that the inspector must have appreciated that the issue was whether it was an existing static caravan and/or chalet site.
35. Accordingly, in my judgment, reading the decision letter fairly and as a whole, it would be wrong to infer that the inspector had misunderstood the arguments before him and given a false construction to the concept of "existing site" within the policy.
36. I am fortified in this conclusion by the fact that in Porter Lord Brown, at paragraph 26, cited with approval the following passage from the decision of Forbes J in Seddon Properties Ltd v SSE (1978) 42 P&CR 26,28:

"One must look at what the inspector thought the important planning issues were and decide whether it appears from the way he dealt with them that he must have misunderstood the policy."

37. I do not accept that the inspector's reasons demonstrate that he must have misunderstood EM10. The evidence does not sustain that allegation. Nor do I accept that there was a consensus that the site was not an existing site within the meaning of the policy. It may be, as the appellant's counsel submits, that that was, at least by the end of the argument, the thrust of the submissions being made to the inspector. But even so, as the Kentucky Fried Chicken case shows, an inspector is not obliged to accept the evidence of expert witnesses even though there is no contrary evidence.
38. The other two related questions are whether the inspector has given adequate reasons for his conclusion, and indeed whether it was a conclusion open to him on the evidence.
39. As to the latter question, in my judgment, the inspector was entitled to conclude that the four units of accommodation were chalets within the meaning of the policy. They have that appearance. I do not see why they should fall outwith that concept merely because they were created as a result of converting a cowshed.
40. Mr Hill may be right to say that the creation of chalets in this way would not engage EM10 because it would involve no additional building works, but in my judgment that is immaterial. Once in place, they would plainly be relevant in determining whether the site could properly be described as a chalet site. Indeed, if a significant number of chalets had been erected in this way, it would be absurd not so to describe the site, merely because the chalets were established by adapting existing buildings.
41. However, I accept Mr Hill's submission that when assessing the nature of the site, the three static caravans ought not to have been taken into consideration. It was a breach of planning law to use them for accommodation. As the Chancellor pointed out in argument, it would be surprising if a developer could bring himself within limb one rather than limb two of EM10 by relying on such accommodation when the developer might be required to cease that use at any time (and of course the 1999 enforcement notice was still valid).
42. I am also satisfied that in principle four chalets would have been capable of constituting a sufficient evidential basis on their own to justify the inspector's conclusion that this was an existing site within the meaning of the policy. EM10 does not prescribe the number of chalets or static caravans necessary to bring the existing site within its terms; that is a matter of judgment for the inspector, and it would not have been a perverse conclusion.
43. Finally, I turn to the issue of reasons. This is the area which has caused me most concern. Is it clear why the inspector reached the decision he did? I have come to the conclusion that it is not, and that, to use Lord Brown's words again, the appellant has "genuinely been substantially prejudiced" by the failure to provide adequate reasons.
44. The difficulty as I see it is this. Without any reasons given by the inspector explaining why he considered that the existing site falls within the first limb, it is not clear whether he properly directed himself on this issue. More specifically, he has not stated whether he has had regard to the touring caravans, the static caravans, the chalets or some combination of them all.
45. It is common ground that the inspector could not in assessing the nature of the site take into consideration the touring caravans. Nor, for reasons I have given, was he entitled to have regard to the static caravans, even if in fact occupied, since it was not lawful to use them to provide accommodation. If the inspector took these into account when he ought not to have done, this would again involve an error of law. Would it be material? I think it would unless it could be said that the inspector would necessarily have reached the same conclusion had he focused simply on the four chalets alone. I do not think that it can be said that that is the only proper conclusion that an inspector, properly exercising his judgment, could make, and neither Mr Warren nor Mr Stoker submitted that it could.
46. Nor do I accept the respondents' submissions that as long as there is a factual basis for the conclusion, that is enough, irrespective of whether it is how the inspector approached the matter. That would indeed suffice if it was clear from the decision that the inspector would have found that this was an existing site having regard to the four chalets alone. But the lack of reasons makes it impossible to say that he would.
47. Accordingly, in my judgment this is one of the exceptional cases where a reasons challenge must succeed. There is a real question mark over whether the inspector properly directed himself as to the appropriate factors to consider when assessing the nature of the site. Whilst I am not satisfied that he wrongly understood what the policy required, I am left in real doubt how he applied the policy to the facts. Reasons would have resolved that one way or the other. Without reasons, the appellant is not able to say whether the inspector has reached a conclusion in accordance with the law or not. So the case falls squarely within Lord Brown's category of cases where the challenge to reasons must succeed.
48. It follows that the appeal succeeds and the inspector's decision must be quashed.

Lord Justice Etherton:

49. I agree.

The Chancellor:

50. I also agree.