England and Wales Court of Appeal (Civil Division) Decisions

IN THE COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
ADMINISTRATIVE COURT
MR JUSTICE OUSELEY

		Royal Courts of Justice Strand, London, WC2A 2LL
		21/06/2016

LAWS LJ:

INTRODUCTION

1. These are two appeals against judgments of Ouseley J given in the Administrative Court on 21 April 2015 ([2015] EWHC 1083 (Admin)) and 27 April 2015 ([2015] EWHC 1889 (Admin)). Both judgments were given in the same set of proceedings, a challenge to a compulsory purchase order (CPO) brought under s.23 of the Acquisition of Land Act 1981 (the 1981 Act). By his first judgment Ouseley J upheld the challenge (on certain grounds only), and by the second decided what was the nature of the relief that might be given pursuant to s.24 of the 1981 Act. The claimants, to whom I will refer as Grafton, are the relevant landowners. The Secretary of State for Transport was named as defendant. The Port of London Authority (the PLA), Aggregate Industries UK Ltd and London Concrete Ltd were joined as interested parties. The Secretary of State and the PLA appeal by permission of the judge against the order for relief made pursuant to the second judgment. Further interested parties have been joined in this court so that they might advance submissions on that appeal; I shall give details in due course. The PLA appeals against the first, substantive judgment by permission of Lewison LJ granted on consideration of the papers on 18 December 2015. Grafton have served a respondent's notice seeking to uphold the judge's substantive decision on further grounds, namely those rejected by him. For reasons which I will explain in due course, it has not been necessary to enter into those points.
2. In his first judgment Ouseley J crisply introduced the case as follows:

"1. Grafton Group Ltd and British Dredging Services Ltd, Grafton, own a wharf, known as Orchard Wharf, at Leamouth on the north side of the River Thames, near its confluence with the River Lea, or Bow Creek. Orchard Wharf is unused and vacant, but for a few remaining derelict buildings. Grafton's land here comprises 1.38 ha. of wharf, and a small additional strip. Grafton hoped at some stage to develop it for uses including residential, boat yard and a waste to energy facility, with the facility to handle river borne waste.

2. The Port of London Authority, PLA, made a compulsory purchase order, CPO, under the Port of London Act 1968 for the acquisition of Orchard Wharf, OW, and the strip, to bring it into active use as a wharf, handling river borne aggregates and cement, and for batching them into concrete. These are the CPO or Order lands. Grafton objected.

3. Aggregate Industries UK Ltd and London Concrete Ltd, AI/LC, sought planning permission for the operational development required for that activity. Its application covered the Order lands, and some other land owned already by the PLA, foreshore and jetty. The London Thames Gateway Development Corporation, at the material time (but no longer) the development control authority for the north side of the Thames (the Lower Lea Valley and London Riverside), granted the application for outline permission for the part within its area. The London Borough of Tower Hamlets refused the application for full permission for the operational development. The sole ground of refusal related to the impact of the buildings on the character and appearance of the area surrounding what was seen as a prominent riverfront location. AI/LC appealed against that refusal.

4. An Inquiry was held into the CPO and objections, and into the planning appeal. The Inspector recommended that planning permission be refused, but that the CPO be confirmed. The Secretary of State for Communities and Local Government accepted the recommendation that planning permission be refused. The Secretary of State for Transport, the confirming authority for the CPO, accepted the recommendation that the CPO be confirmed, and confirmed it. In each case, the relevant Secretary of State adopted the reasoning and accepted the conclusions of the Inspector."

At paragraph 7 the judge gave these details of the CPO:

"The Port of London Authority (Orchard Wharf) Compulsory Purchase Order 2012 stated that it was made on 28 May 2012 under s.11(2) of the Port of London Act 1968 for the purposes set out in s5(1A) and (2) of that Act. It would authorise the PLA to purchase compulsorily the Order lands 'for the purpose of securing the provision of port and harbour services and facilities at Orchard Wharf pursuant to its undertaking and functions under' s.5(1A) and (2). No greater detail of the purpose of the proposed acquisition was given in the Order."

3. Grafton brought these proceedings to challenge the CPO decision. Ouseley J upheld the claim on two seemingly interlinked grounds: (1) the Secretary of State confirmed the CPO on a different basis from that upon which it had been promoted throughout the Inquiry, and did so without legally sufficient evidence (first judgment, paragraph 117); (2) in the circumstances that was unfair to Grafton, who did not have "a fair crack of the whip" (paragraph 156). These conclusions are challenged in this court by the PLA, with the support of the Secretary of State, under what have been called Grounds 2 and 3; these are the Grounds for which Lewison LJ gave permission. In his second judgment Ouseley J held that in consequence of his substantive decision, by force of s.24 of the 1981 Act the CPO had to be quashed in its entirety: it was not open to the court to quash only the Secretary of State's confirmation of the CPO and leave the Order as made by the PLA intact – which would, as in effect the judge acknowledged (paragraph 10), have sufficed for the justice of the case. This conclusion is challenged in Ground 1, for which the judge gave permission and on which the Secretary of State has carried the burden of the argument.

PLANNING POLICY

4. At paragraphs 14 – 17 of his judgment Ouseley J set out material extracts from the London Plan (part of the local development plan) which commend (Policy 7.26B) the protection of "existing facilities for waterborne freight handling use" and increased "use of safeguarded wharves [which include Orchard Wharf (OW)] for waterborne freight transport, especially on wharves which are currently not handling freight by water". The supporting text, as the judge noted (paragraph 15) has this:

"7.77 The redevelopment of safeguarded wharves should only be accepted if the wharf is no longer viable or capable of being made viable for waterborne freight handling uses."

5. The legal means by which wharves are safeguarded are unusual. Ouseley J described the position as follows:

"18. The legal process of safeguarding a wharf is not its declaration as such in a policy, but a Ministerial direction under the Town and Country Planning (General Development Procedure) Order 1995…, Article 10(3), which enables the Minister to give directions requiring a local planning authority to consult with specified bodies before granting permission for particular types of development. The extant Direction was made in 2000, to allow for the powers of the Mayor, following an earlier Direction in 1997. It applies to applications for planning permission on OW of a particular type, and which would include non-wharf development, and requires the London Borough of Tower Hamlets to consult the London Mayor. So the policy in the London Plan applies to those wharves in respect of which a Direction is in force: they are 'safeguarded', even though the only requirement of the Direction is consultation with the Mayor."

6. Supplementary planning guidance ("Safeguarded Wharves on the River Thames: London Plan Implementation" – SWIR) recommended that OW should retain its safeguarded status. As the judge said (paragraph 20), at the time of the Inquiry the SWIR was under review by the Greater London Authority. The Safeguarded Wharves Review of March 2013 (SWR) contained its final recommendations. Grafton had been one of the consultees. It had not been approved by the time of the Inspector's Report, nor by the time of the two Ministerial decisions. The SWR recognised weaknesses in the SWIR, but recommended the continued safeguarding of OW: the site was "viable, well located to serve central and inner London locations and can satisfy an element of the forecast shortfall of aggregate supply in the sub-region".

GROUND 1 – RELIEF

7. I turn first to the appeal brought by the Secretary of State and the PLA against the order for relief made by Ouseley J following his second judgment.
8. S.23 of the 1981 Act provides so far as relevant:

"(1) If any person aggrieved by a compulsory purchase order desires to question the validity thereof, or of any provision contained therein, on the ground that the authorisation of a compulsory purchase thereby granted is not empowered to be granted under this Act or any such enactment as is mentioned in section 1(1) of this Act, he may make an application to the High Court.

(2) If any person aggrieved by—

(a) a compulsory purchase order…

desires to question the validity thereof on the ground that any relevant requirement has not been complied with in relation to the order or certificate he may make an application to the High Court.

(3) In subsection (2) above "relevant requirement" means—

(a) any requirement of this Act…

(4) An application to the High Court under this section shall be made within six weeks—

…

(b) … from the date on which notice of the confirmation or making of the order is first published in accordance with this Act…"

S.24(2):

"If… the court is satisfied that -

(a) the authorisation granted by the compulsory purchase order is not empowered to be granted under this Act…, or

(b) the interests of the applicant have been substantially prejudiced by [non-compliance with any relevant requirement],

the court may quash the compulsory purchase order or any provision contained therein… either generally or in so far as it affects any property of the applicant."

9. S.25 provides:

"Subject to the preceding provisions of this Part of this Act, a compulsory purchase order… shall not, either before or after it has been confirmed, made or given, be questioned in any legal proceedings whatsoever."

S.26(1):

"Subject to section 24 above, a compulsory purchase order… shall become operative on the date on which notice of the confirmation or making of the order is first published in accordance with this Act."

The requirements as to publication are set out in s.15. By s.7(1) "compulsory purchase order" has the meaning given by s.2(1). S.2 provides in part:

"(1) The authorisation of a compulsory purchase shall be conferred by an order (in this Act called a 'compulsory purchase order').

(2) A compulsory purchase order authorising a compulsory purchase by an authority other than a Minister shall be made by that authority and submitted to and confirmed by the confirming authority in accordance with Part II of this Act."

The confirming authority is, for the purpose of this case, the Secretary of State.

10. At paragraph 4 of his second judgment Ouseley J said this:

"The debate between the successful claimants and the Secretary of State, and the Port of London Authority, is what is meant by 'quash the compulsory purchase order' [sc. in s.24(2)]. Mr Village QC submits that that means that the whole of the compulsory purchase order as made and as confirmed falls to be quashed. There is only one compulsory purchase order, he submits, and that is what is quashed. The contention from the Secretary of State and the Port of London Authority is that quashing the compulsory purchase order means quashing the confirmed compulsory purchase order as opposed to the made compulsory purchase order and that the effect of that, unlike the effect for which Mr Village contends, is that the process does not have to go back to square 1 with the making of a new compulsory purchase order and the start of a new inquiry process as a result of the objections which can be anticipated."

11. The Law Commission in its Consultation Paper No 169 2001-2002 took the view that the power given by s.24(2) was to quash the whole of the compulsory purchase order, as made and as confirmed. At paragraph 4.24 it suggests that the provision

"… may be unnecessarily draconian in many cases. It apparently forces the court to quash the whole order upon its inception, even where the grounds of challenge relate only to the process of confirmation, or even simply to the Secretary of State's reasoning."

12. The scope of the power in the 1981 Act to grant relief has not previously been the subject of full argument, although it is clear that in earlier cases dealing with predecessor legislation or similar provisions in other Acts the courts have proceeded on the same basis as was articulated by the Law Commission.
13. The Law Commission's view might thus be said to represent the conventional, if unconsidered, wisdom. Ouseley J adhered to it in the present case; he accepted Mr Village's argument for Grafton that the whole of the compulsory purchase order as made and as confirmed fell to be quashed (paragraphs 10 – 12 of the second judgment). Mr Banner for the Secretary of State and Mr Harris QC for the PLA submit, however, that this is the wrong approach. Mr Banner observed that since the substantive grounds on which in his first judgment Ouseley J had found the CPO process wanting related entirely to the confirmation stage (the Inquiry, the Inspector's Report and the Secretary of State's decision), it would be disproportionate and anomalous if the only relief the court could grant would unwind the whole process, including the making of the CPO in the first place. Mr Village did not accept that the position was as bleak as Mr Banner suggested; the judge for his part was content to recognise (paragraph 10) "that this is a conclusion which does not necessarily aptly fit the circumstances which I have found exist here". However it is to be noted that the Housing and Planning Bill before Parliament at the time of the hearing and now enacted as the Housing and Planning Act 2016 includes (at section 201) express provision to allow the court to quash the confirmation of a CPO following a successful claim under s.23 of the 1981 Act. Mr Banner in his skeleton argument (paragraph 12) points out that the Explanatory Note shows that the intention is to "clarify" the position in light of the current ambiguity: it is not to be assumed that the Bill's premise is that the existing law precludes such a limited remedy.
14. In another compulsory purchase case, Horada & Ors v Secretary of State [2016] EWCA Civ 169 (the Lord Chief Justice, Longmore and Lewison LJJ), the court gave judgment on 18 March 2016 but adjourned the issue of relief pending the decision in the present case. It ordered that the parties be joined as interested parties in these proceedings "to allow them to make submissions on the common issues arising in relation to section 24 of [the 1981 Act]". In consequence we have heard argument from Mr Warren QC representing the developer in the Horada case and Mr Wolfe QC for Mr Horada (on behalf of the Shepherd's Bush Market Tenants' Association). The former supported the appeal on Ground 1; the latter opposed it.

The First Argument: Construction of the Statute

15. Mr Banner submitted that the meaning of the term "quash" in s.24(2) is "deprive of legal effect"; and in context that relates to the CPO's confirmation. By s.26(1) the CPO only becomes "operative" when notice of confirmation is published (the reference in s.26(1) to the "making" of the order relates to a ministerial order – not relevant here). Thus the order land cannot be acquired under the CPO until after confirmation; nor can the CPO be challenged under s.23 until after publication of its confirmation. Accordingly, submits Mr Banner, the CPO only assumes legal effect upon the publication of the confirmation notice; and therefore the power to "quash" in s.24(2) is a power to deprive the CPO of the legal effect which s.26 gives it upon confirmation.
16. In advancing his case as to the meaning of "quash" Mr Banner relied on what was said by Sir Clive Lewis in Judicial Remedies in Public Law (5^th Ed. 2015) at 6-002 – 003 and 6-016: the term's ordinary meaning at common law in the context of a public law challenge is "to deprive of all legal effect".
17. Mr Harris supported Mr Banner, though the focus of his argument was not upon the construction of the term "quash" but upon that of "compulsory purchase order". He submitted that there are, so to speak, three stages in a CPO's progress: (1) the CPO as made; (2) the CPO as confirmed; and (3) the CPO after its confirmation has been published pursuant to s.15. Nothing is authorised by the CPO until stage (3). The definition of a CPO, given in s.7 by cross-reference to s.2(1), confines the term's meaning to that stage. S.2(1), read with s.2(2), shows that the function of authorising the acquisition is integral to the proper construction of "compulsory purchase order" in s.24(2).

Conclusions on the First Argument

18. In my judgment these submissions on the construction of the statute are unsustainable. Mr Banner's argument on the meaning of "quash" founders on the long accepted rule – acknowledged by Sir Clive Lewis ("all legal effect") – that the effect of an order to quash, certiorari in the old language, was to render the instrument in question as if it had never been. If only the confirmed CPO were quashed, leaving the made CPO, the latter would still have legal effects: appeal rights, and the Secretary of State's duty to hold a public inquiry (s.13A of the 1981 Act). Mr Banner was driven to submit that only the substantive legal effect of the CPO – that is, the land's acquisition – was the target of a quashing order under s.24. But as soon as such niceties arise, they are refuted by the plain riposte that if Parliament had intended such distinctions, it would have said so.
19. Mr Harris' position fares no better. It is not possible to construe the term "compulsory purchase order" as it appears in s.24(2) as referring only to the CPO after confirmation and publication. It bears the meaning (by cross-reference from s.7) given by s.2. Reading s.2(1) and (2) together demonstrates, conspicuously in my view, that the term is intended to refer compendiously to the CPO as made and confirmed. The fact that the CPO is only "operative" after publication of its confirmation does not imply, in light of s.2, that the instrument in its earlier stages is not under the statute a CPO at all. As my Lord David Richards LJ pointed out in the course of argument, the attributes of authorisation and confirmation of the CPO are treated as different concepts in s.2(2). The CPO is, as it were throughout its incarnation, recognised as the source of authority for the land's acquisition notwithstanding that its authority does not bite until after publication.
20. In short, "compulsory purchase order" means the instrument so called from first to last. If the legislature had intended to allow for relief going only to its confirmation, it would have so provided.

The Second Argument: Inherent Power

21. This submission proceeds upon the premise that the argument on construction (whether it relates to the meaning of "quash" or that of "compulsory purchase order") fails; otherwise it adds nothing. It assumes, therefore, that the power to grant a lesser form of relief than quashing the CPO from start to finish cannot be got out of s.24 on its true interpretation. Mr Banner's submission that "the greater includes the lesser" (skeleton argument paragraph 26) has to be treated as part of his case on construction, and as such cannot survive my rejection of the construction argument if my Lords agree with it. (It is also, in my judgment, specifically refuted by Mr Wolfe's correct submission that the closing words of s.24(2) – "or any provision contained therein… either generally or in so far as it affects any property of the applicant" – expressly identify the extent to which the court may quash less than the whole CPO.)
22. However Mr Banner also submits, with the support of Mr Harris and Mr Warren, that the court has an inherent power to grant a lesser form of relief. This argument would require us to hold that on a challenge under s.23 the court has power to grant a form of relief which is not derived from, and owes nothing to, s.24 of the 1981 Act. But as I have shown s.25 provides that other than by means of ss.23 – 24, a CPO "shall not… be questioned in any legal proceedings whatsoever". The submission therefore entails some qualification to the literal terms of s.25. Counsel referred to my judgment in the case of Cart in the Divisional Court ([2009] EWHC 3052 (Admin), [2010] 1 All ER 908), with which Owen J agreed. Discussing "[t]he court's ingrained reluctance to countenance the statutory exclusion of judicial review [as] a principal engine of the rule of law" (paragraph 34), I said:

"37… The sense of the rule of law with which we are concerned rests in this principle, that statute law has to be mediated by an authoritative judicial source, independent both of the legislature which made the statute, the executive government which (in the usual case) procured its making, and the public body by which the statute is administered…

40. None of this, of course, is to say that Parliament may not modify, sometimes radically, the procedures by which statute law is mediated. It may impose tight time limits within which proceedings must be brought. It may provide a substitute procedure for judicial review, as it has by a regime of statutory appeals in fields such as town and country planning, highways, and compulsory purchase: where, however, the appeal body remains the High Court. It may create new judicial authorities with extensive powers. It may create rights of appeal from specialist tribunals direct to the Court of Appeal. The breadth of its power is subject only to the principle I have stated."

23. Our decision in Cart was appealed to this court, and thence to the Supreme Court. I do not understand my observations in those paragraphs to have been departed from. Mr Banner submitted that the blunt inconvenience of the s.24 remedy, as I would construe it, in some way offended the rule of law principle which I ventured to describe. I cannot see that that is so. I would certainly accept that if a provision, purporting to oust judicial review, provided in its place a remedy which was so ineffective as to amount in truth to no remedy, the court would incline to disallow the ouster. That is not this case. A blunt instrument remains an effective weapon, though it may do too much damage.

Conclusion on the Second Argument

24. In my judgment the only remedy available upon a challenge to a CPO is that given by s.24 as I would construe it. There is no inherent power to grant a different remedy, lesser or otherwise.

GROUND 2 – EVIDENCE

25. This Ground is closely linked to Ground 3 (unfairness). So much is clear from Ouseley J's compendious summary of his conclusions as to "the consequence of the dismissal of the planning appeal" (the heading to paragraphs 105 ff of his judgment) at paragraph 117:

"My judgment, in summary, is that there was nothing wrong in principle in confirming the CPO despite the dismissal of the planning appeal. The Secretary of State was also entitled to conclude that there was a reasonable prospect of some form of aggregates/cement handling permission being granted. But that meant that the basis upon which the CPO was confirmed was different from the basis upon which it had been promoted throughout the Inquiry. If the Secretary of State concluded that there was a reasonable prospect of an acceptable scheme which was not significantly different in throughput from the appeal scheme, or of the implementation of a scheme which was significantly different in throughput, those conclusions had no evidential basis. The Secretary of State did not give Grafton a fair opportunity to deal with his basis for confirming the CPO, changed as it was from that presented at the Inquiry. Had he followed the suggestion of the Inspector about a 'minded to confirm' letter, these problems could have been avoided."

26. Although Mr Harris (skeleton paragraph 51) and Mr Village (skeleton paragraph 37) both assert a connection between them, in my view Grounds 2 and 3 are best kept apart. The Inspector distinctly concluded that the planning appeal should be dismissed because (paragraph 12.61) "due to the poor design and layout, the specific appeal proposals would not accord with the development plan". But he held (ibid.) that "there is no reason to believe that it would not be possible to devise a viable scheme that would overcome much of the environmental harm"; in particular (12.59) "[t]here is every reason to suppose that reactivation, including a batching plant, could be achieved with a better design and layout, ideally by including the same extent of plant and storage but, if not, through scaling it down slightly." This conclusion, as to the viability of a revised scheme, is challenged on two separate bases: (1) there was no legally sufficient evidence to support it, and (2) its introduction by the Inspector as a ground for confirming the CPO was, in the events which happened at the Inquiry, unfair to Grafton who had no proper opportunity to deal with it. These points are logically and legally distinct. At this stage I am only concerned with the first.

The Secretary of State's Decision

27. The Inspector was not of course the decision-maker. His recommendations were confirmed by the Secretaries of State (Transport in the case of the CPO; Communities and Local Government in the case of the planning appeal) on 16 September 2014. The judge held (paragraphs 135 – 137) that the Secretary of State for Transport confirmed the CPO on a broader basis than that of the Inspector's recommendation. The Inspector had concluded that "the same throughput might be achieved with no or but a slight change to the extent of the plant and storage, but better designed and laid out [12.59]" (judgment paragraph 132); but the judge considered "that the Secretary of State's decision to confirm the CPO was [not] critically dependant on some minimum throughput in order for the public benefit to be made out. In [22] the Secretary of State comments: 'There is no convincing evidence to suggest that the site could not operate economically nor that there is insufficient business to maintain its use for aggregates and concrete.' That comment is also more general and appears to go wider than a scheme with a throughput not significantly different from that of the particular scheme which the PLA/AI/LC had promoted" (judgment paragraph 135).
28. In my view the distinction drawn by the judge between the Inspector's Report and the Secretary of State's decision letter is not justified. Neither the Secretary of State's observation at paragraph 22, cited by the judge, nor any other comment in the decision letter, qualifies the plain statement at paragraph 7 of the letter: "[t]he Secretary of State… has considered the whole of the Inspector's Report and the arguments within it and accepts his conclusions and recommendations." At paragraph 45 the Secretary of State added that he "is adopting the Inspector's Report and his recommendation with regard to the compulsory purchase order in full". There is no gap between the Report and the decision letter. It follows that our judgment on Ground 2 (and indeed Ground 3) may proceed on the footing that the contents of the Inspector's Report inform without qualification the decision to confirm the CPO.
29. It is not suggested that the judge was wrong to hold in paragraph 117 that in principle the CPO might be confirmed despite the dismissal of the planning appeal. Nor is there any criticism of his further reasoning at paragraph 119:

"Confirmation of a CPO is not in law or policy necessarily tied to any particular scheme for which planning permission is simultaneously sought. So the refusal of planning permission for a particular scheme on grounds which the Inspector thought remediable, rather than fatal in principle to the very purpose of the CPO, does not necessarily require non-confirmation of the CPO, and the starting of the whole process all over again with a different planning application. So there was no error in principle of itself in confirming the CPO while dismissing the planning appeal."

The submission on Ground 2 is only that the judge should not have concluded that there was no legally sufficient evidence to justify the confirmation of the CPO on the basis on which, pursuant to the Inspector's recommendation, the Secretary of State confirmed it.

Evidence and Planning Judgment

30. The starting-point for consideration of Ground 2 is the well known dictum of Lord Hoffmann in Tesco Stores Ltd [1995] 1 WLR 795 at paragraph 57:

"If there is one principle of planning law more firmly settled than any other, it is that matters of planning judgment are within the exclusive province of the local planning authority or the Secretary of State".

But this does not absolve the decision-maker of the need to act on evidence. If it did, planning cases would possess a characteristic unique in the public law sphere: they would be unconstrained by the discipline of the Wednesbury rule ([1948] 1 KB 223). Plainly that is not the case. There must be evidence to provide the factual materials upon which the planning decision-maker will form his conclusions. His view of the question whether the material before him is or is not adequate for that purpose lies within the scope of his planning judgment; and so – of course – does his conclusion as to the planning outcome or outcomes. To that extent the familiar concept of planning judgment may be said to involve two stages: sufficiency of the evidence and conclusion on the merits. No doubt they merge in practice. Lord Hoffmann's dictum applies to both, although its focus is especially directed at the latter stage, the planning outcome. Here, it is the first stage to which Ground 2 invites scrutiny. Was there material on which a reasonable decision-maker could proceed to the second stage, and thus form a conclusion that "the same throughput might be achieved with no or but a slight change to the extent of the plant and storage, but better designed and laid out" (Inspector's Report paragraph 12.59, cf. 12.61)?

The Evidence in this Case

31. It is I think clear that the foundation of the Inspector's decision to recommend that planning permission be refused for the development applied for lay in the scale and design of the proposed buildings. The whole of the Inspector's conclusions on the planning appeal (paragraphs 12.1 to 12.61 of the Report) repay attention, but these short extracts will suffice to make the point:

"12.16… [T]he enormity and extent of the proposed buildings would be evident in important public views. The structures would be much larger than their immediate neighbours and… they would appear massive, prominent and overbearing, particularly from the east side of the EIDB [East India Dock Basin]… Compared even with the desolate and vacant site, the proposals would have a significant and harmful impact on the appearance and setting of the EIDB…

12.19 The scheme would therefore harm the character and appearance of the area…

12.34 The appellants' argument that there are limited opportunities when designing a water borne cargo facility such as this is an assertion which is not supported by a great deal of evidence… Although it is just conceivable that the appellants' consultant engineers' solution is the only arrangement that would achieve a viable concrete batching plant on the site, there is scant analysis to support the contention that there is no other possible layout or building configuration that would satisfy these requirements…

12.35… There is no evidence that an alternative design of batching plant or cement silo is not available or that these could not be custom-built to deal with the specific constraints, including views. Similarly, there is no evidence that cement silos must be of a specific height…

12.36 There is little evidence that thought has gone into alternative layouts and arrangements of structures to take account of the site's environmental constraints or wider context…"

And so the Inspector proceeded to his conclusion on the planning appeal at 12.59 – 12.61: I have already cited the critical extracts. From 12.62 to 12.123 he addressed the PLA's application for confirmation of the CPO. I will cite just two passages:

"12.74 Moreover, there is no reason why a better layout and design would necessarily involve significantly greater costs than the elaborate timber treatment proposed…

12.121… It is a matter of judgment as to whether or not a better design would be likely to come forward. The balance from the evidence is that it probably could and would. If followed, these recommendations do not require an unattainable goal, simply that good design skills are deployed to produce a scheme that properly considers how the necessary plant could be arranged and enclosed to minimise the harm to the environment."

32. It is clear, and in my view important, that the Inspector's reasons for recommending refusal of planning permission and for concluding nevertheless that "the same throughput might be achieved with no or but a slight change to the extent of the plant and storage, but better designed and laid out (paragraph 12.59)" are closely intertwined. As is stated in Mr Harris' skeleton argument (paragraph 22), the Inspector had examined the appeal scheme before him and the criticisms of it in some detail. He was aware of the throughput of the proposal, its component parts and the benefits which would flow from the proposal, for example in terms of what is called "modal shift". These were the building blocks for his conclusions at paragraphs 12.59 – 12.61.

The Judge's View

33. Much of this, but not all of it, was accepted by the judge. The critical paragraphs in his judgment are as follows:

"142 Mr Banner and Mr Harris submitted that the Inspector was an architect, and so would have some expertise and experience in that capacity, which I am prepared to assume will have included some experience in this area, and that he went to sites where a variety of batching plants could be seen. The Inspector had had a thorough analysis of how the present scheme was arrived at; he had accepted that the flaws resulted from the way in which the design and layout parameters had been set in the first place. They had not been re-examined, yet it was they, in his judgment, which caused the serious problems. His views about what could be done started from that unchallengeable judgment. If he reached a judgment that there was a reasonable prospect that a scheme, which would be acceptable in planning terms, could be designed if one started at the proper place, respecting site constraints, that was a planning judgment, accepted by the Secretary of State, with which this Court should not interfere.

143 I accept that submission only up to this point: the Inspector would have been entitled to conclude, as a matter of planning judgment, even on the limited state of the evidence before him, that there was at least a reasonable prospect that a planning permission would be granted for the structures and buildings required for some level of aggregate and cement handling, probably but not necessarily with a batching plant, at OW. It is difficult to see, given the size of the site, and the policy support for such a use, that he could conclude otherwise…

144 What I cannot accept is the fullness of their submission that, if the Inspector did in fact conclude in [12.59] that the throughput of this unknown scheme would not be significantly different from the appeal proposal, that too was a legitimate planning judgment which required no more specific evidence to support it than the Inspector's own expertise. That is all that Mr Banner and Mr Harris could rely on, for there was no more specific material before the Inspector or referred to by him. If he concluded that a 'slight' alteration to the scale of plant and storage, with better design and layout could produce an insignificantly different throughput, I consider that he required evidence, which he did not have, to reach so specific a conclusion. This could have been by way of simple indicative but measurable material. He needed to have evidence in view of his many and very serious criticisms of flaws which went right back to the beginning of the design and layout of the appeal scheme, and in view of the varied constraints imposed by the surrounding area. The more fundamental the changes required, the more difficult it is for that judgment to be made without specific evidence. He did not say that it was just a question of lopping a few feet off a building's length or height; there was no specific objectionable but removable feature which he identified. He has not said that a particular parameter such as height limits or limits on the length of the buildings is to be observed or that an area of wharf should be excluded from development, so that the effect of that on throughput could be considered or proven. He put forward no suggestions for comment. There is no description by him of what changes would meet his requirements, and how…"

Conclusions on Ground 2

34. Thus the judge accepted that the Inspector was entitled to conclude "that there was at least a reasonable prospect that a planning permission would be granted for the structures and buildings required for some level of aggregate and cement handling" (paragraph 143), but not "that the throughput of this unknown scheme would not be significantly different from the appeal proposal" (paragraph 144). I do not accept that the lawful reach of the Inspector's planning judgment was curtailed by such a dividing line.
35. It is true that the Inspector does not spell out the details of a better designed scheme with the same or similar throughput. It was no part of the PLA's case at the Inquiry that an alternative design might be adopted (a fact to which I will revert in addressing Ground 3). But the Inspector's conclusion did not envision a fully worked up scheme; rather, he determined that the environmental harm which would inevitably be occasioned by reactivation of the wharf could be reduced or mitigated by an improved design and disposition of the buildings. This is made especially clear by the Inspector's statement at paragraph 12.47 that "[t]he matter is one of balance, but the balance to be struck is not between a very harmful wharf activity and no wharf at all, but between a very harmful or a less harmful one". Note also paragraph 12.67: "the unusual safeguarding Direction is likely to mean a stark choice between reactivation and continued blight for Orchard Wharf. Objectors have confirmed that it intends to land bank the site until safeguarding is removed. While all relevant matters should be considered, these facts alone provide a strong case in favour of acquisition" (cf. paragraph 12.118).
36. It seems to me that the judge's reasoning at paragraph 144 rests on the premise that the Inspector could only lawfully arrive at the overall conclusion that a better design might come forward if chapter and verse of such a design had been presented to him in the evidence, or elaborated by him on the basis of evidence. I think the premise is false. Given his comprehensive appreciation of the details of the scheme on offer, his criticisms of its scale and design, his legitimate emphasis on the benefits of the wharf's reactivation, taken with his view (paragraph 12.61) that "on balance, the proposals would be contrary to the development plan and the appeal should fail" (my emphasis), the Inspector was in my view wholly entitled to decide that there was a sufficient probability of an alternative, adjusted scheme coming forward and that in those circumstances the CPO should be confirmed. This was quintessentially an exercise of planning judgment.
37. I would allow the appeal on Ground 2.

GROUND 3 – UNFAIRNESS

38. As I have said, it was no part of the PLA's case at the Inquiry that an alternative design might be adopted. So much was plainly accepted by the judge: paragraph 122. And the judge rightly concluded (paragraph 131) that "the CPO was confirmed by the Secretary of State, accepting the Inspector's conclusions, on a basis other than that put forward by the PLA/AI/LC": the Secretary of State accepted the Inspector's conclusions at paragraphs 12.59 – 12.61, to which the possibility or probability of an improved scheme was integral.
39. It is true, as the judge observed (paragraph 153), that the Inspector asked all the planning witnesses whether the CPO might be confirmed if the planning appeal were dismissed. Mr Village's case before the judge was that it had been common ground at the Inquiry that if the planning appeal were dismissed, the CPO could not be confirmed. The Inspector's Report is a little more qualified: "[c]ontrary to the evidence from some witnesses on both sides, refusal of planning permission on account of poor design should not necessarily lead to non-confirmation of the CPO" (paragraph 12.73). At all events, the judge observed at paragraph 165:

"The Inspector's questions revealed nothing specific about the basis upon which he might recommend that the Secretary of State dismiss the planning appeal and confirm the CPO. He did not ask questions about whether a redesign could be accomplished with only a minor reduction in throughput if any, or records no answers if he did. He did not suggest that that was the basis upon which he might recommend confirmation of the CPO and dismissal of the appeal."

The judge went on to state at paragraph 168 that "Grafton had no opportunity to address the basis upon which the Secretary of State confirmed the CPO", but the essence of his reasoning on this part of the case is to be found at paragraph 158:

"The Inspector's questions did not make the confirmation fair in the circumstances. The relevant point is not whether the questions revealed the possibility of there being two different decisions, for they certainly did that; and the persistence of the Inspector in asking it of so many witnesses meant that that was clearly something in his mind. The real point is whether, knowing of that possibility, Grafton had a fair chance to address the basis upon which the CPO was eventually confirmed without the planning appeal being allowed. It did not."

40. Grafton knew or should have known that a split decision was in the Inspector's mind. But Mr Village's written closing submissions to the Inspector demonstrate that they did not treat it or regard it as a viable possibility:

"Where, as we submit will be the case here, planning permission is refused, then there is no conceivable basis upon which it would be appropriate to confirm the CPO. This represents the clearest impediment to implementation and in answer to the Inspector's questions of all the planning witnesses (and in accordance with their responses) we submit that if planning permission is refused, the CPO must fail. There is no evidence that some 'other' scheme exists, none has been put forward, and all parties have proceeded on the basis that the scheme before this inquiry is the scheme which underpins the CPO…"

41. Central to the Inspector's recommendation that the CPO be confirmed was his view that "a better design would be likely to come forward" (Report paragraph 12.121; cf. 12.59 – 61). As a distinct proposition, that was never put to the parties at the Inquiry. The Inspector's questions to the witnesses did not do so. Mr Village should have been given an opportunity to address it, unspecific as it was: indeed, he may have made much of its want of specificity. As matters stood, his closing submissions were perfectly reasonable, and the judge was right to hold that his clients had been unfairly treated.
42. I would dismiss the appeal on Ground 3.

OVERALL CONCLUSIONS

43. At the end of the hearing we indicated to the parties that the appeal on Ground 3 would be dismissed. In consequence it remains the position, as found by Ouseley J, that the CPO was unfairly and therefore unlawfully confirmed. In those circumstances Mr Village indicated that he would not seek to pursue the points in the respondent's notice.
44. There remains the question of relief. Are we in effect obliged simply to replicate or leave in place the judge's s.24 order? At the end of the hearing Mr Harris suggested that we should adjourn the question of relief to see what position the Secretary of State might take in the light of our judgment: the Inspector had suggested that he might issue a "minded" letter (paragraphs 12.74, 12.122). There may be difficulties with such a course, and I did not understand it to be an agreed position between the parties. In my view we should invite written submissions on relief.

Lord Justice Longmore

45. I agree.

Lord Justice David Richards

46. I also agree.