England and Wales Court of Appeal (Civil Division) Decisions

IN THE HIGH COURT OF JUSTICE
COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM QUEEN'S BENCH DIVISION
MR JUSTICE BLAKE
CO/9092/2009

		Royal Courts of Justice Strand, London, WC2A 2LL
		18/04/2011

LORD JUSTICE CARNWATH :

Introduction

1. In 2007 the appellants' builders yard at Carpenters Road, London E15, was compulsorily acquired by the London Development Agency as part of the development area for the London 2012 Olympic Games and subsequent legacy uses. As a preliminary to Rooff's claim for compensation, Rooff applied to the local planning authority for a "certificate of appropriate alternative development" under section 17 of the Land Compensation Act 1961. The authority had to decide what classes of development, if any, would be permitted if the land were not to be compulsorily acquired.
2. The authority granted a certificate specifying as appropriate Use Class B1 (Business) and B2 (General Industrial), but not C3 (Residential) as proposed by Rooff. They appealed to the Secretary of State, who, adopting the findings of his inspector following a local inquiry, dismissed the appeal. Blake J dismissed an application to the High Court. In this court Mr Hobson QC on behalf of Rooff challenges the Secretary of State's decision on two grounds: first, that the inspector's reasoning was inadequate, in a way which substantially prejudiced his clients, and, secondly, that he adopted an incorrect approach to the Development Plan provisions applicable to the site.

Law

3. The law is fully set out in Blake J's judgment and is not materially in dispute. I can take it shortly.
4. The application for a certificate must specify any classes of development which are thought to be "either immediately or at a future time" appropriate for the land in the absence of compulsory purchase (s 17(3)). The authority in response must either state those classes (whether or not specified in the application) for which in its opinion planning permission would have been granted (usually referred to as a "positive" certificate), or state that permission would not have been granted for any development other than that for which the land is being acquired (a "negative" certificate) (s 17(4)).
5. The fact that a class may not be in accordance with the development plan is not in itself a reason for treating it as inappropriate (s 17(7)). However, under ordinary principles of planning law, the determination should be made in accordance with the development plan unless material considerations otherwise indicate (Planning and Compulsory Purchase Act 2004 s 38(6)). Section 18 gives a right of appeal to the Secretary of State. Section 21 enables that decision to be challenged in the High Court on conventional legal grounds.
6. The judge described the role of the decision-maker in terms which have not been criticised:

"10. The task of the local authority is to treat an application for a certificate as if it were a planning application, but a planning application based on the hypothesis that the development that caused the compulsory purchase order was not going to take place. Although the application can contemplate future development the applicant must identify the times at which such development could be appropriate; where the development proposed by the applicant is not immediately appropriate, therefore, the circumstances in which it would be would have to be identifiable and foreseeable." (para 10)

It should be added that, in a case where there is a possibility that the land might be developed as part of a larger area of land, including land not in the applicant's ownership or control, that possibility must be considered and, if appropriate, reflected in the certificate (Sutton v Secretary of State (1984) 50 P&CR 147). However, the certificate issued by the Secretary of State in this case contained no indication that the site could only be developed in conjunction with other land.

7. The sole purpose of the certificate is to assist the agreement of compensation or (if necessary) its determination by the Upper Tribunal (Lands Chamber). The position before the tribunal follows from sections 14 and 15:

i) Where a certificate states that planning permission for any classes of development would have been granted on all or part of the land, it is to be assumed that permission "would be so granted"; but subject to any conditions specified in the certificate, and (if applicable) only at the future time specified in the certificate (s 15(5)).

ii) Where a certificate indicates that permission for a class of development would not be granted, the tribunal is not precluded from itself considering whether planning permission could reasonably have been expected to be granted, but for that purpose "regard shall be had" to any contrary opinion expressed in the certificate (s 14(3A)).

iii) Nothing in these provisions is to be read as requiring the tribunal to assume that planning permission would necessarily be refused for any class of development (s 14(3)). Accordingly, even apart from the statutory planning assumption arising from a certificate, it remains open to the owner to seek to prove before the tribunal that permission for some form of valuable development would, or would reasonably have been expected to be, granted in the "no-scheme world".

It is to be noted, however, that for valuation purposes there may be a significant difference between a statutory certificate, and a finding by the tribunal that permission was to be expected. In the former case, the assumed permission is treated as a certainty for valuation purposes. In the latter case, the value of the assumed permission may need to be discounted to reflect the relative uncertainty in the no-scheme world of an actual grant (see Spirerose v Transport for London [2009] UKHL 44; [2009] 1 WLR 1797).

8. The relevant date for considering the issues under section 17 is fixed by reference to the date of the notice of the "proposal to acquire", as defined by section 22(2). In this case that date is agreed to be 16^th November 2005. This is not the same as the valuation date for the tribunal, which is fixed by reference to the date of entry or vesting, in this case the dates of the two general vesting declarations (April and July 2007) by which the land was transferred to the LDA.
9. It is common ground that the reasons must satisfy the standard explained by Lord Brown in South Bucks District Council and another v Porter (No 2) [2004] UKHL 33; [2004] 1 WLR 1953. In particular:

"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 the issue of law or fact was resolved…. A reasons challenge will only succeed if the party aggrieved can satisfy the court that he is genuinely substantially prejudiced by the failure to provide an adequately reasoned decision."

The appeal site and surroundings

10. The appeal site lies on the north-east side of Carpenters Road, between it and some busy railway lines. It is part of an area described as "the Carpenters Road area". This area includes land on both sides of Carpenters Road which runs from south-east to north-west. The area is bounded on the south-west side by the Waterworks River.
11. The inspector described the immediate surroundings as "uncompromisingly commercial in nature and/or inimical to residential development".

"…To the east was Thatched House Yard, dominated by the maintenance and repair of motor vehicles. Caerns Yard to the west was similarly characterised by various units occupied by motor vehicle enterprises. On the southern side of Carpenters Road was a vehicle breaking business and a yard used for the storage of aggregates of this storage industry. Other plots on the south side of the Carpenters Road had already gone out of use but their rundown appearance added to the generally down-at-heel nature of the locality. The railway line on the northern boundary of the land carried frequent freight trains. They often stopped at signals on the line waiting for slots between the frequent passenger trains on the main line out of Liverpool Street station. The noise of accelerating mainly diesel freight locomotives hauling laden and unladen trucks around a tight bend in the tracks and over point work generated significant noise levels on the appeal site." (para 157)

12. Beyond the railways to the north-east was the "Stratford City" development area, described by the inspector as -

"… a very large comprehensive mixed-use development currently under construction and encompassing the as yet unopened Stratford International station sited on the High Speed Channel Tunnel Rail Link." (para 4)

He noted that this development had been granted planning permission in February 2005, that there were detailed permissions for the construction of access roads to it from Carpenters Road, and that the local authority had indicated willingness to use compulsory purchase powers for that purpose:

"By the relevant date, road proposals affecting the surroundings of the appeal site had been agreed in principle. These involved realignment of Carpenters Road in the direction of a bridge across the railway line on the site of Thatched House yard. On the other hand, the appeal site would have remained essentially intact, served by a short service cul-de-sac of the realigned Carpenters Road."

He added:

"Because of its proximity to the site (12 metres in places) the new elevated road over the railway line could be seen as a further detraction from residential development on the site…" (para 158)

Planning policies

13. The statutory development plan consisted of two documents: the Mayor of London's London Plan (the "spatial development strategy" for London) adopted in February 2004, and the Council's Unitary Development Plan (UDP) adopted in June 2001. Also material were two forms of non-statutory Supplementary Planning Guidance: Newham's "Arc of Opportunity Planning Framework Document" dated November 2002, and "Stratford: A 2020 Vision", dated August 2003, drafted by the Rail Lands Working Group (a consortium of local authorities, Transport for London and the Greater London Authority). Although the inspector expressed some doubts as to the legal basis of the latter documents (referring to Westminster City Council v Great Portland Estates Plc [1985] AC 661), their legality and materiality were not in dispute before us.
14. The London plan was necessarily at a very general level. Mr Hobson relied particularly on the strong policy support for mixed use developments including housing. Policy 3B.4 reads:

"…wherever increases in office floor are proposed they should provide for a mix of uses including housing, unless such a mix would demonstrably conflict with other policies in this plan…"

15. The UDP placed emphasis on the opportunities arising from the Stratford Rail Lands to create major opportunity zones (MOZ), where mixed use developments were encouraged. The appeal site fell within the Stratford Rail Lands MOZ1, for which certain general objectives were identified, principally relating to employment uses. The only specific reference to residential use was in relation to links to an area (the Clays Lane estate) not directly relevant to the appeal site. It was however accepted by the local authority witness at the inquiry that there was nothing in the UDP which ruled out residential development in the Carpenters Road area.
16. Turning to the non-statutory guidance, the "Arc of Opportunity" document of November 2002 dealt specifically with the Carpenters Road area. It stated:

"Proposed land uses: This site forms a key gateway into the Rail Lands and requires development of the highest quality to reflect this. The Council is seeking a mixed-use employment led scheme in accordance with the UDP designation, which include B1, B2 and supporting residential uses set within high quality landscaping. The close proximity to the Waterworks River provides an ideal opportunity to create residential units fronting onto it. Any residential development should include a mix of unit sizes and provide an element of affordable housing in accordance with Council's UDP policies…"

Other uses, such as B8 (storage) and waste transfer facilities were deemed "inappropriate… due to the proximity of residential properties and the objective to create a high quality environment…".

17. The inspector attached more weight to the other non-statutory guidance, Stratford: A 2020 Vision, because it was more recent and post-dated the London plan. The objectives of the plan included the regeneration of the Rail Lands to produce "high quality, high density, mixed use developments" (p 5). Under "Housing" it stated (para 3.7):

"The Rail Lands offer considerable scope for new residential development and the potential to create an entirely new community.

Residential development should form both an element of a mixed use scheme and single use developments…."

The Carpenters Road area was referred to as one offering "scope to create concentrations of new residential development", which could include "specialist housing" such as business flats, student accommodation or private apartments for key workers. It added:

"… Where new residential development occurs it should take advantage of proximity to the existing Lee Valley Regional Park and adjacent rivers and waterways and link or draw these features into the schemes. A larger residential population will also increase the demand for an extended range of social facilities to the benefit of the wider area."

Inspector's report

18. The inspector's report is for the most part an impressively thorough and comprehensive treatment of the issues, legal and factual. The relevant parts are set out in full in the judgment below. I will refer only to those directly material to the arguments before us.
19. He began by setting out the appellant's case (paras 11-47). Their contention was that the site was appropriate for a "mixed use scheme comprising B1/C3 uses", and that the certificate should also include "Live/work" units (a term, which speaks for itself, and is apparently familiar to planners). In brief summary, they argued that the Stratford City development would in turn create opportunities for the Carpenters Road area, as well as providing for improved access. Mixed use including a residential element was in accordance with the development plan policies. The site's location adjacent to the railway line was not unusual for a regeneration scheme area of East London, and noise could be alleviated by conditions to require acoustic treatment. Early development on the site could help to stimulate the regeneration of the area. Illustrative plans of a possible mixed use development on the appeal site were produced at the inquiry, but the proposed proportion of residential or live/work space was left open.
20. In anticipation of the inspector's conclusion, I should refer to two particular paragraphs in this section: paragraph 14, where the inspector referred to Rooff's reliance on policy 3B.4 of the London Plan; and paragraph 41 where reference is made to the "catalytic" effect of development on the appeal site, as a means of "priming the pump and starting the momentum to bring about the qualitative change which the LPA seeks" in this area.
21. The authority's case was then set out. In summary their objections were three-fold: first, the "inherent unsuitability" of the site and its surroundings for residential use; secondly, the lack of a comprehensive approach to development of the Carpenters Road area; and thirdly the new roads for the Stratford City site would exacerbate rather than improve the problems of the site (paras 63, 68, 73-5)).
22. For the inspector's own analysis I can start at paragraph 159, at the end of a passage entitled "The State of the Land and the Area in which it is Situated" (parts of which I have already quoted). He started by noting the areas of common ground:

"Where there is little disagreement between the parties (and it is a consensus with which I concur) is that the state of the land and surroundings, by themselves, were not suited to any form of residential development on the relevant date, as determined alone by the pattern of development existing at that time. However, the policy framework that had developed over the previous five years indicated that the site and its surroundings were not going to stay the same with or without the Olympic Games being held in London in 2012."

He identified the issue between the parties as he saw it:

"The question therefore to be determined is whether those changes from the previous pattern of development were going to be so drastic, prior to the award of the Games in London, as to permit residential development to be reasonably foreseeable on the appeal site, as postulated by the appellants, or whether those changes would result in a continuation essentially of employment uses on this land, albeit following redevelopment, as argued by the local planning authority and the acquiring authority…."

Against that background he turned to consider the policy framework for the period 2000-2005, which he thought "should, in this particular case determine the outcome of this appeal."

23. In the next section, headed "The Planning Policy Framework on the Relevant Date", he referred to the relevant policy documents noted above, and concluded:

"170. Drawing these somewhat dispersed policy threads in the 2020 Vision Supplementary Planning Guidance together, it seems to me that a logical overall pattern, to determine the outcome in this appeal, can be discerned. In the no-scheme world of Carpenters land, mixed comprehensive development, incorporating a significant amount of housing but primarily employment generating led, could take place in the locality even before Stratford City had taken off. The housing element would tend to gravitate towards the attractive waterside location of the Waterworks River where its potentially quick implementation would bring about significant improvements to the waterway's landscape qualities and the provision of important new pedestrian and cycle links…."

24. Turning to the appeal site, he said:

"171. The need for comprehensive development would seriously count against the development of the appeal site in isolation. Were it to come forward for redevelopment in a more piecemeal manner, the land's inability to benefit from a waterside location, coupled with proximity of the freight-carrying railway line even with adjoining "bad neighbour" commercial uses removed, would militate against its development for part of the significant residential element on the Carpenters land as a whole.

172. It may be that an all-office development on the appeal site, which would not be in breach of the CAAD issued by the council, would require a proportion of residential accommodation in accordance with London Plan Policy 3B.4. [14]

It may also be the case that, contrary to the guidance expressed in the 2020 Vision Supplementary Planning Guidance, early redevelopment of the Carpenters land did not take place and a landmark building incorporating a preponderance of residential accommodation could be erected in isolation to act as a suitable gateway to Stratford City adjoining its approach road and kick starting redevelopment in the remainder of the Carpenter lands. [41]

However, the advice in paragraph 8 of Appendix P to Circular 06/2004 is that general policies of the development plan should be followed, so that small pockets of residential provision associated with office development can be disregarded for the purposes of issuing a certificate.

Moreover, paragraph 16 requires a decision to be based on the current and reasonably foreseeable policies prior to the cancellation of the scheme, not a development that deliberately ignored such policies to simply stimulate redevelopment that was otherwise showing signs of severe delay in getting off the ground."

(For ease of reference I have split the paragraph into its four sentences. It is common ground that the first two sentences are to be taken separately, referring respectively to separate parts of the appellant's case as previously summarised by the inspector (see para 20 above). They are then answered in turn in the third and fourth sentences.)

25. The Departmental Circular mentioned by the inspector (06/2004) gives guidance on compulsory purchase order procedures. Appendix P deals with certificates under section 17. Paragraph 8 explains the "broad and common sense" approach to be applied to the certificate procedure. The inspector's reference to "general policies" is evidently to the following passage:

"… the Secretary of State would expect the local planning authority to exercise its planning judgement, on the basis of the absence of the scheme, taking into account those factors which would normally apply to consideration of planning applications e.g. the character of the development in the surrounding area, any general policy of the development plan, and national planning policy along with other relevant considerations where the site raises more complex issues which it would be unreasonable to disregard. Only those forms of development which for some reason or other are inappropriate should be excluded. Local planning authorities will note from section 17(7) that their certificate can be at variance with the use shown by the development plan for the particular site." (emphasis added)

The other reference is to paragraph 16 of the same Appendix, which summarises the "three main issues" to be addressed in determining an application under section 17: (a) the physical considerations; (b) "the current and reasonably foreseeable planning policies"; and (c) identifying and disregarding the planning consequences of the scheme.

The Issues in the Appeal

Reasons

26. The first ground of appeal is directed principally to paragraph 172. None of the experienced counsel before us has found it easy to construe. Their comments ranged from Mr Hobson's "incomprehensible" to Mr Kolinsky's "not as clear as it might be" and Mr Roots' "could have been more tidily expressed". It has been subject to detailed analysis by all three.
27. In relation to the first and third sentences, Mr Hobson submits that the suggestion that "small pockets of residential development" can be disregarded is both obscure, and unsupported by anything in the Circular. Far from saying that pockets of residential development can be disregarded, the circular emphasises that all appropriate forms of development should be included in the certificate. The implication of the first sentence is that an office development of the site (as accepted by the authority's certificate) would have required a proportion of residential accommodation to comply with the London Plan. If so, it is impossible to understand what reason there would be for excluding it from the certificate. As to the fourth sentence, the circular itself advises that a certified development may be at variance with the use shown by the development plan. In any event, there is nothing in the inspector's earlier review of the policies to justify the statement that the proposal "deliberately ignores" the current policies.
28. Mr Kolinsky, supported by Mr Roots, urges us to look at the paragraph in the context of the inspector's conclusions as a whole. So read it is not central to his reasoning. The decision turns principally on the view that the policies required comprehensive development, that it was unrealistic to expect the residential component of such a development to be on the appeal site, and that, in the unlikely event of a separate development of that site, it would not be appropriate for residential use. Paragraph 172 is at the stage of "mopping up" outstanding points, dealing with what he regarded as an "unrealistic and hypothetical scenario". The London Plan did not impose a mandatory requirement for housing in every case, nor would any housing need to be on the same site as the office development. The fourth sentence, which addressed the suggestion of a "kick start" development of the appeal site, rejected it as unrealistic under current policies.
29. The judge agreed generally with the respondents. He found the reasoning of paragraph 172 "elliptical", but not fatally so. He said:

"33. I note that paragraph 172 is prefaced by the word may. The question for the inspector is would such planning permission be granted. In that context I accept the defendant's submission that what was going on in this paragraph is some engagement with the alternative or further submissions advanced by the claimant at the inquiry. But once the central hypothesis of overall comprehensive development of both the Stratford City area and the adjacent Carpenters Road lands is put aside, then the claimant's case necessarily becomes very much weaker and more speculative as to the degree of reasonable likelihood there would be of either adverse factors disappearing or positive factors emerging. (The judge's emphasis)

34. In any event the contention that was being addressed in paragraph 172 depended upon 3B.4 having some mandatory requirement to add residential space to any new stand alone office building, but the policy properly construed imposes no such requirement independent of environmental considerations or planning proposals for the area. Thus even if the appeal site were to be examined as the first piece of land on which planning permission would be granted its unsuitability for residential accommodation remained. The planners would also be able to identify that development plans for the rest of the land (even if not yet implemented) would provide ample accommodation for residential needs in more suitable areas particularly (though not necessarily exclusively) the waterside area.

35. This is perhaps the thread of the reasoning in 172, but even if the inspector's reasons failed the standards of clarity required by the South Bucks v Porter decision, I conclude no detriment has been suffered by the claimant for the reasons set out in the preceding paragraphs of this judgment."

30. I am unable with respect to accept that view. The difficulty to my mind starts at paragraph 159, where the inspector seeks to identify the "question". Understandably he starts from the position that the present uses of the immediate area are incompatible with residential use, and that therefore some change must be envisaged. What he does not do clearly is to distinguish between the two different ways in which, on the appellants' case, such a change might be envisaged as leading to a residential permission on the appeal site.
31. The first would be a comprehensive development of a larger area including the appeal site. Under the Sutton principle that could assist the appellants' case for a residential certificate on their site, but only if the likely distribution of uses within such a larger scheme would favour residential use on their part of it. The inspector was entitled to conclude that within such a larger scheme, the residential use would, in his words, "gravitate" towards the more attractive southern parts of the area (para 170), so that there would be no reason to expect permission on the appeal site in order to meet the London Plan objectives.
32. The second possibility was the appellant's so-called proposal for a separate development of the appeal site designed to "kick start" the development of the rest of the area. The inspector might possibly have rejected this on the grounds advanced by the authority: in summary, that it would be contrary to the principle of comprehensive development, and that the immediate environment, both then and following construction of the new road, would be wholly unsuitable for residential use. Had he done so in unequivocal terms, his reasoning on such a matter of planning judgement would be difficult to challenge in the courts.
33. I find it impossible, however, to read paragraphs 171 and 172 as amounting to such a clear adoption of the authority's case. Paragraph 171 refers to the need for comprehensive development, and the unsuitable environment, as factors "seriously counting against" or "militating against" a separate, partly residential development of the appeal site. But it does not treat those factors as sufficient in themselves to reject the proposal.
34. On the contrary, the first two sentences of paragraph 172, by the use of the word "may", imply that the inspector sees some planning merit in the suggestion of a separate "gateway" development, including an element of residential use in accordance with the London Plan and designed to "kick-start" development of the Carpenter's Road area. His reasons for ruling it out are not those put forward by the authority, nor apparently are they based on considerations applicable to an ordinary planning application. Rather they appear to be based on his understanding of the Secretary of State's guidance in relation to the section 17 procedure: first, that it allows him to disregard the residential element of such a scheme as "a small pocket", not relevant to the "general policies" on which the section 17 consideration is to be based; secondly, that it enables him to disregard proposals which "deliberately ignore" the policy framework.
35. I find on any view that reasoning difficult to understand or support. In the first place, it is unclear what is meant by the reference to "small pockets of residential provision". If he is suggesting that a housing element on the appeal site can be disregarded for section 17 purposes because it is small in relation to the area to which the general policies apply, that is clearly wrong. The certificate should specify any uses appropriate for the appeal site, regardless of their scale in relation to the wider area. Whether or not the general policies are designed to deal with "small pockets" of individual uses, what matters is whether residential use would be acceptable as a significant element of the development of this site. Similarly, the reference to "current and foreseeable policies" in paragraph 16 is nothing to the point. As the earlier parts of the appendix make clear that is not intended to rule out consideration of the planning merits of an individual proposal, even it may depart from the approved policies. The question is whether, notwithstanding the lack of specific support in the policy documents, there are significant and insuperable planning objections to the particular development.
36. Further, it is difficult to understand the reference to "deliberately ignoring" the policies. The inspector's earlier review of the policy documents identified what he regarded as a "logical overall pattern" for development of the Carpenters Road area (para 170), but nothing which was fundamentally inconsistent with a housing element on the appeal site. It was accepted that housing was an appropriate use for the Carpenters Road area in general, and there was no specific policy excluding such use from the appeal site. He had, it is true, identified the need for comprehensive development as a factor counting seriously against the proposal, but not as sufficient in itself to rule it out. As has been seen, the certificate as issued permitted the assumption of a separate development for B1 or B2, not necessarily linked to a wider area.
37. With respect to the inspector, I find this part of his reasoning defective judged by the South Bucks test (para 9 above). If that is correct, I have no doubt that the appellants have been substantially prejudiced. The proposal for a separate mixed development was an important aspect of their case. Mr Hobson's submission was recorded by the inspector:

"…In the real world, both authorities, the planning authority and the regeneration authority, would have welcomed a scheme that would have secured the beneficial redevelopment of the appeal site. Far from seeking to frustrate and defer development that would get the regeneration process moving, they would have done all in their power to bring it to fruition…." (para 46)

38. On this view the issue was whether there would be any planning objections sufficient to overcome what would otherwise be a welcome initiative in the area. There might be questions about whether in the real world any developer would commit finance to such a project, or how attractive the housing would be to potential occupants, but those would be principally matters for the market rather than the planning authority. In so far as the noisy environment was an objection, there was an issue whether it could be overcome by suitable acoustic treatment. These were all issues raised at the inquiry on which the appellants were entitled to have a clear answer. The inspector's decision does not give it.

The Development Plan

39. I can deal shortly with the second ground of appeal, which concerns the inspector's treatment of the development plan. As he reminded himself (para 160) section 38(6) required him to have regard to the development plan and to make his determination "in accordance with the plan unless material considerations indicate otherwise". Mr Hobson submits that he failed to make any finding on the "crucial question" of whether a housing development on the site would or would not have been in accordance with the development plan. Had he done so, it is said, he could only have answered that question in the affirmative.
40. I am not persuaded by this point. As I read the report, the inspector concluded that neither statutory plan provided much direct guidance as to the form of development appropriate on this particular site, and therefore (at least by implication) that the statutory presumption was of little relevance. In my view that was a legitimate approach. He was entitled to treat the statutory wording as directed to something more specific than, for example, indications of the general desirability of mixed use development (as in the London Plan), or of lack of objection to housing within the Carpenters Road area as a whole (as conceded by the authority's witness). In the absence of such help in the statutory plans, he was entitled look to the non-statutory guidance for more direct assistance. Such guidance was a "material consideration", but was not given special presumptive status by section 38(6).

Conclusion

41. I conclude that the appeal succeeds on ground 1, and that, in accordance with section 21, the Secretary of State's decision must be quashed. That is the limit of our powers. It will be for the Secretary of State, in consultation with the parties, to decide how then to proceed. It is to be hoped that a further inquiry can be avoided, bearing in mind that this is still only one step in the process of the determining of compensation for an acquisition of land which took place some four years ago. Even if the Secretary of State decides following reconsideration that a residential element would have been acceptable as part of a mixed-use development on the site, that may reveal little about the ultimate level of compensation. That will depend on judgements yet to be made by the valuers (or ultimately the tribunal) about the relative proportions of the various uses in a likely scheme, and the market response.
42. These features are the inevitable consequences of the section 17 regime, which requires the planning status of the land to be determined in the abstract, isolated from the market considerations which in the end will determine value for compensation purposes. Whether that is a satisfactory regime is open to debate. We were told that, in response to proposals for reform put forward in the context of the Localism Bill, the Minister has undertaken to conduct a review. Meanwhile our decision must be made on the law as it stands, whether or not it will ultimately assist the appellants.
43. Accordingly, I would allow the appeal and quash the decision.

LORD JUSTICE RIMER :

44. I agree.

LORD JUSTICE LONGMORE :

45. I also agree.