England and Wales High Court (Administrative Court) Decisions

IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
THE ADMINISTRATIVE COURT

		Royal Courts of Justice Strand London WC2
		22 September 2004

1. MR JUSTICE OUSELEY: This is an application under section 288 of the Town and Country Planning Act 1990 to quash a decision of the First Secretary of State, dated 30 March 2004. By that decision, he refused planning permission for the construction of 187 dwellings, open space provision and related matters on 5.7 hectares of land on the southern edge of Morpeth. The land in question lies to the south of County Hall and is owned by Northumberland County Council.
2. The Inspector had recommended, following the holding of a public inquiry, that planning permission be granted. The appeal which he heard was made by the claimant, George Wimpey Limited, against the failure by the local planning authority, Castle Morpeth Borough Council, to determine its planning application. The Secretary of State rejected the Inspector's recommendation. Castle Morpeth Borough Council resolved after the appeal had been lodged that it would have refused planning permission had the matter not been appealed already.
3. The two main issues at the inquiry were:

(1) What was the extent of the shortfall in housing supply in Castle Morpeth?

(2) Were Areas 2, 3 and 4 of the appeal site "previously developed land" within the scope of those words in PPG3?

4. The Inspector concluded that George Wimpey's assessment of housing supply and shortfall was correct and that there would be a deficit of over 200 dwellings by the end of 2006, the end of the structure and local plan periods. It was agreed that Area 1 (1.1 hectares) was previously developed land and would be likely to receive planning permission soon. He also concluded that Areas 2 and 3, at least, were previously developed land.
5. The argument about whether they were previously developed land turned on whether those areas were within the curtilage of County Hall. The Secretary of State concluded, in disagreement with the Inspector, that they were not within the curtilage of County Hall, and for that reason were not previously developed land.
6. There was an issue before me as to whether the First Secretary of State had accepted George Wimpey's figures of housing shortfall as the Inspector had done. Mr Morshead, who appeared for him, submitted that he had indeed accepted the Inspector's conclusions on that matter but had rejected his conclusion that the appeal site should be permitted to be developed, or permitted to be developed now in order to make up that shortfall. He had done so because he had concluded that Areas 2 and 3 were greenfield sites rather than previously developed land. No sequential exercise had been done to compare those areas with other possible sites. Furthermore, the regional guidance and emerging structure plan Alterations meant that, with potential previously developed land, there was no sufficient urgency to justify the release of this large greenfield site now.

Housing Land

7. Section 54A of the 1990 Act requires the First Secretary of State to make decisions in accordance with the provisions of the development plan unless material considerations indicate otherwise. The development plan for these purposes is the Northumberland County Structure Plan and the Castle Morpeth District Local Plan, each running from 1991 to 2006. The former was adopted in 1996, the latter in February 2003. Policy H1 of the Structure Plan requires 2,500 dwellings to be built in Castle Morpeth between 2001 and 2006. Policy H3 requires each district to maintain a 5-year supply of readily available land capable of meeting the build rate implied by that target.
8. The Local Plan in Policy H2 identified sites which, with conversions, windfalls and those already built, would provide, on the Authority's assessment contained in the Plan, all but 44 dwelling units of that target. Policy MH1 identified five sites in Morpeth, including Area 1 of the appeal site. Areas 2 to 4 were not allocated for development in that Plan. The reasoned justification to Policy MH1, paragraph 30.16.9, refers to Areas 2 and 3, among other sites, as follows:

"Land at Southgate Wood has been allocated throughout the plan period for housing development. As part of the review of housing allocations under PPG3 (Housing), part of the site has been confirmed as being available through the Council's Urban Capacity Study. This is the site of the former County Council Business Centre. The remainder of the previous allocation (which extends round the rear of County Hall and is bounded by the Catchburn) is a greenfield site on the edge of the settlement. Considering the current availability of brownfield land in Morpeth, the release of such greenfield sites cannot be justified. However, this site does have some potential to meet some of the longer term development needs of the Town, but this decision would be taken in the context of the availability of brownfield land at that time, the progress towards meeting Structure Plan Housing Targets and the need to avoid an oversupply of land."

9. RPG1, the Regional Planning Guidance for the North East to 2016 and approved in November 2002, requires Northumberland County to provide 700 dwellings per annum to 2006 and 800 per annum thereafter. This was a reduced build rate. The Northumberland County and National Park Joint Structure Plan, First Alteration Deposit Draft of May 2003 proposed to allocate an annual average of 110 dwellings per annum to 2006 and 125 dwellings per annum thereafter to the Castle Morpeth Borough Council area.
10. In paragraph 11 of the Inspector's report, he accepts that objections had been made to that Plan for consideration at an EIP in March 2004, which meant that little weight should be afforded to it. In so concluding, the Inspector relied upon paragraph 48 of PPG1. That did not mean that account could not be taken of it however. It was not at issue at the inquiry but that the site (Areas 1 to 4, although no actual development was proposed on Area 4) was suitable for housing and was in a sustainable location, lying within the settlement boundaries of Morpeth. The First Secretary of State took the view that, as greenfield sites, Areas 2 and 3 were not suitable for housing "at this time". It appears that there is an issue as to precisely what was meant in that context by "suitable for housing".
11. The Inspector's report sets out the contentions of the parties. In paragraph 22 he notes that the Local Authority conceded that the up-to-date shortfall against the development plan targets would be in excess of 104 dwellings, with some further allowance to be made for planning permissions not being implemented. However, the Local Authority also argued that RPG1 meant that it had to construct 565 dwellings between 2002 and 2007, and it had ample land to meet that requirement without the release of greenfield land, as it saw Areas 2 to 4 of this appeal site.
12. In paragraph 32, the Inspector records George Wimpey's case as being that the stock of land relied on by the Local Authority to fulfil the requirement set out in the development plan needed to be examined, and their location, in terms of the sequential test in PPG3, in comparison with the appeal site. George Wimpey attacked the prospect of sites coming forward from among those set out in policies H2 and MH1 of the Local Plan.
13. The Inspector referred to various concessions which had been made by the Local Authority and the disputed sites which had been the subject of discussion between the Local Authority and George Wimpey's advisers in the usual way. He concluded in paragraph 74:

"To summarise the position with regard to allocations in Policy H2, the Council admit that the 70 houses allocated at Hadston 2A will not be built and that not all permissions will be implemented. In addition, I consider that the development of the Lairage to be in serious doubt resulting in the loss of the estimated 25 houses here. Add this to the accepted shortfall of 60 dwellings at St George's Hospital and the projected deficit of 34 and the shortfall would be at least 189 dwellings. Should the Council permit the appellant's application to redevelop the disused business centre this would reduce the deficit by 8. However, if one accepts the appellant's assumption that 10 per cent of permitted sites will not be developed this would increase the deficit by a further 36 dwellings [34] leading to a deficit at the end of the plan period of over 200 dwellings."

14. He then considered in paragraphs 75 to 76 sites which were not allocated under policy H2, but which the Local Authority had put forward at the inquiry as preferable to the appeal site in sequential terms. Those paragraphs also considered sites which local residents had put forward as preferable. Each suffered from various constraints, and the Inspector concluded in paragraph 77:

In light of the above, I am not persuaded that these sites would come forward before the end of the plan period and, for that reason, they would not assist the Council in meeting the requirements of Policy H1 of the Structure Plan or RPG1."

15. His overall conclusion on the housing issue in paragraph 78 was:

"The Council do not dispute and I see no reason to question the appellant's confidence that if permitted, the development could provide a significant number of houses within the plan period. To my mind, the potential net increase of 159 dwellings (187 minus the allocation of 28 on the disused business centre) would make a significant contribution to meeting the Structure Plan target. It would also, in my view, assist the Council in achieving the objectives set out in RPG1. I conclude, therefore, that the proposal is necessary to meet the housing needs of the Borough."

16. It is useful also at this stage to note paragraph 82:

"Given my conclusions regarding the brownfield status of the site and the Council's acceptance that it is suitable for housing, I see no reason to hold back development pending a review of the Local Plan. In addition, in my view, the Local Plan at paragraph 30.16.9 makes provision for the development of the whole of the site subject to, amongst other things, progress towards meeting the Structure Plan target."

17. I turn now to the Secretary of State's conclusions in his decision letter. The First Secretary of State attached some weight to the fact that RPG1 and the emerging Structure Plan First Alteration envisaged a reduced housing requirement for Morpeth. Although that plan was at an early stage, in his view:

" ... the emerging Structure Plan proposal is consistent with the judgment he has made about preferring to attach more weight to the monitor and manage approach than to the threat of a shortfall. Proper consideration under the monitor and manage approach would be foreclosed if Areas 2 and 3 were released by this appeal. The Secretary of State also notes that the Council's urban capacity study includes several previously developed sites in Morpeth which appear to be preferable to Areas 2 and 3 on an application of the sequential criteria."

18. Crucially for Mr Village's submissions, paragraph 11 of the decision letter dealt with, or purported to deal with, the figures in relation to housing supply. Much debate is centred on that paragraph:

"The Secretary of State appreciates that the Council's own figures (updated to June 2003) predict a shortfall of 34 dwellings against the Local Plan's target. However, he regards this shortfall as insignificant both in absolute terms and, moreover, in light of the emerging Structure Plan notwithstanding the relatively early stage of that plan. Even if he had not taken the view that the shortfall is insignificant, the Secretary of State's view would nevertheless have been that a shortfall of 34 dwellings was of insufficient weight to justify the proposed development of 187 dwellings on the appeal site."

19. The Secretary of State commented, in effect, on paragraph 30.16.9 of the Local Plan in paragraph 12 as follows:

"The Secretary of State notes that the Local Plan describes the appeal site, including Areas 2 and 3, as showing some potential to meet some of the longer-term development needs of the town. The Secretary of State makes clear that he expresses no view on that assessment. But he takes the view that any decision to release Areas 2 and 3 for their long-term potential should be taken in light of the circumstances that prevail when longer-term development needs fall to be assessed."

20. The final point which the Secretary of State made in relation to housing, relevant for these purposes, was in paragraph 27 in his overall conclusions as follows:

"The Secretary of State attaches significant weight to the question of housing need but does not accept that it is possible to conclude that there will be insufficient land to meet the Structure Plan target. Rather, he has had regard to the Local Plan and emerging Structure Plan and considers that there is no need for the development of 187 houses at this time and, given the policy in RPG1 that there should be a reduction in the rate of the construction of new dwellings, that need for development on such a scale may not arise. If however need does arise, the Secretary of State considers that there may be sequentially preferable previously developed sites in the Borough."

21. It is useful to set out certain extracts from "PPG3: Housing" 2000 at this stage. PPG3 imposes an obligation on local planning authorities to identify sites for housing and buildings for conversion and reuse sufficient to meet its housing requirements, and requires them to manage the release of land over the planning period. That is in paragraph 28. Paragraphs 29 and 30 provide as follows:

"29. Local planning authorities in preparing development plans should adopt a systematic approach to assessing the development potential of sites, and the redevelopment potential of existing buildings, deciding which are most suitable for housing development and the sequence in which development should take place.

30. In identifying sites to be allocated for housing in local plans and UDPs, local planning authorities should follow a search sequence, starting with the re-use of previously-developed land and buildings within urban areas identified by the urban housing capacity study, then urban extensions, and finally new development around nodes in good public transport corridors. They should seek only to identify sufficient land to meet the housing requirement set as a result of the RPG and strategic planning processes. In doing so they do not need to consider all the land in their area: they should not extend the search further than required to provide sufficient capacity to meet the agreed housing requirement."

22. Paragraph 31 sets out criteria relevant to that exercise, which include: the availability of previously developed sites, the location and accessibility of potential sites to jobs and services, infrastructure requirements, and the ability to build communities.
23. Paragraphs 32 and 33 require a Local Authority to adopt policies that cause previously developed land to be developed before greenfield sites, that is to say to apply the sequential process that is set out in paragraph 30 of PPG3. Paragraph 34 requires sufficient sites to be allocated to provide for five years' development of housing land, which allocations should be monitored, reviewed and rolled forward with time.
24. Paragraph 38 deals with how development plans should be seen in the light of this PPG. The First Secretary of State regarded the Local Plan here as satisfying the requirements of PPG3. Paragraph 38, however, says that guidance may override a non-conforming local plan. Even if a greenfield site were allocated in such a plan, PPG3 policy priorities should be applied to it, and comparison with previously developed land would be particularly relevant in the decision whether or not to grant planning permission.
25. I now turn to the detail of this first ground of challenge. Mr Village QC, for the claimant, submitted in this first ground of challenge that the First Secretary of State had ignored both the claimant's case on housing shortfall and need, and the Inspector's acceptance of that case. Paragraphs 11 and 27 of the decision letter dealt only with the Council's pre-inquiry updated shortfall. Had the First Secretary of State considered the position as found by the Inspector and had he accepted it, the need argument against which he balanced the release of this greenfield site, as he saw it, could have been very different. The First Secretary of State had ignored a relevant consideration and had failed to deal with an issue of particular importance in the case, or to give reasons for any apparent conclusion on it which he did reach.
26. Various other aspects of the Secretary of State's approach to the housing land supply issue were criticised, but the principal point made was that the decision letter simply failed to grapple with what were the crucial figures in the case.
27. Mr Morshead's submissions for the First Secretary of State were, in essence, that the claimant had misread the decision letter. In fact, the First Secretary of State had accepted the shortfall conclusions reached by the Inspector; nowhere had he rejected them. It would be truly astonishing if the First Secretary of State had dealt with the contentions of the Local Authority based on the Development Plan and had ignored the Inspector's conclusions on them. The decision letter should be read as assuming an acceptance of those figures, and paragraphs 11 and 27 therefore made other points.
28. Paragraphs 9 and 10 of the decision letter, he submitted, showed that the First Secretary of State had thought that the Structure Plan targets were less important than the Inspector had done, and thought it was more important that the Local Plan, which did not allocate Areas 2 and 3 for housing, was up-to-date and based on an urban capacity study and therefore it mattered more. Consequently, any actual shortfall fell to be dealt with under the plan, monitor and manage approach of PPG3. To permit the development of the appeal site would cut across that approach because those areas had not been ranked or compared with others under PPG3's sequential approach. All of that analysis by the First Secretary of State necessarily assumed that the claimant's and the Inspector's shortfall figures were correct. The First Secretary of State, in effect, concluded that the appeal site should not be developed because it had not been through a ranking comparison. Indeed, there was previously developed land in the urban capacity study which the Secretary of State said seemed to be preferable. In the light of the emerging Structure Plan in RPG1, the need to meet any shortfall was less urgent because of the potential for a reduction in the build rate.
29. Paragraph 11 was explained as dealing with a further potential objection which the claimant might raise to that line of argument or analysis by the First Secretary of State, ie that the adopted Local Plan, albeit updated from the figures in it, still showed that there was a deficit, albeit small, to be met. It was not a point which had been raised by Wimpey's, but the Secretary of State thought he needed to address it; it was that small shortfall which was being dismissed as unimportant, not the shortfall which the Inspector had found. Where in paragraph 27 of the decision letter the First Secretary of State had said that it was not possible to conclude that there would be insufficient housing, he was not referring to the shortfall figures as found by the Inspector, he was referring back to the absence of a comparison between the appeal site and previously developed land in any urban capacity study. If there were a need for such development, such previously developed land might come forward instead.
30. I do not accept Mr Morshead's submissions. It is very surprising that the Inspector's conclusions and the claimant's case on housing need was not dealt with in the decision letter explicitly, or even apparently considered. Particularly this is so when other figures which are not relevant to the case as put by the parties or as concluded by the Secretary of State are dealt with in paragraph 11. Mr Morshead has urged that that is so surprising that it supports his point that in fact the Secretary of State had indeed tacitly accepted the Inspector's conclusions. But I am unwilling to take the fact that such a failure is surprising as sufficient by itself to warrant a conclusion that the failure contended for by Mr Village had not happened.
31. I am especially reluctant to do so where the terms of the decision letter contain almost no support for Mr Morshead's proposition. First, there is no explicit statement of any acceptance of the Inspector's conclusions. No consideration is given to the significance of the conclusion that there was a substantial shortfall when the First Secretary of State weighed the need for housing against the advantages of the plan, monitor and manage approach, and against the potential availability of previously developed land from the urban capacity study, or against the absence of a sequential test ranking for Areas 2 and 3. The only consideration given to figures is in paragraph 11 of the decision letter which talks of a shortfall of 34 as the shortfall, ie the only relevant shortfall. If the Secretary of State had been making a purist point, moreover, about the Local Plan target and seeking to anticipate an argument which had not been raised, it is curious that he chose to update it for past completions and yet ignored agreed future shortfalls. It is plain that a clear analysis and decision on the extent of housing need is critical to the subsequent analysis of how that weighs against other considerations which the Secretary of State was entitled to take into account.
32. Second, there is very little in the rest of the decision letter to point to any acceptance in this respect of the claimant's case. The second and third sentences of paragraph 9 contrast a shortfall against the Development Plan target (the Structure Plan target but it is also the Local Plan target) with the position as is seen in the Local Plan. This false contrast between the Structure Plan and the Local Plan in those two sentences readily fits with a rejection of the Inspector's conclusions, or reaching no conclusion on it because of some other approach which was preferred.
33. It is difficult to abstract an acceptance of the Inspector's conclusions on the figures, coupled with the disavowal of their significance as he saw them, which is what Mr Morshead submits he was doing, from any paragraph in the decision letter. Likewise, paragraph 10 of the decision letter speaks of "the threat of a shortfall", whereas the Inspector had not found that a shortfall was a risk or a threat, or possible down the line, but that there was in fact insufficient land to meet the target (see for example paragraphs 74 and 83 of the Inspector's report). The Inspector concluded that there would be a shortfall looking to the picture now, and to the imminence of the end of the plan period in 2006.
34. In paragraph 27 of the decision letter, the Secretary of State says that he "does not accept that it is possible to conclude that there will be insufficient land to meet the Structure Plan target". I find this to be the clearest sign that the view was taken that the Secretary of State did not accept, or regarded as irrelevant, the Inspector's conclusions in relation to the figures. That is because what he does not accept in that sentence is precisely what the Inspector concluded. Mr Morshead's explanation that that sentence dealt with the absence of a comparison in an urban capacity study or sequential ranking between the appeal site and other sites bears no relationship to any language which the Secretary of State uses.
35. Thirdly, there are other indicators that either the issue has been ignored or the Inspector's conclusion rejected for no reasons which are discernible. In paragraphs 10 and 27 of the decision letter, the First Secretary of State refers to the potential for previously developed sites in the urban capacity study to come forward. The First Secretary of State is no more explicit than that as to what sites he is in fact identifying, but it may be that those are the ones in the study which are notated "deferred post 2006". Yet the Inspector's report makes it clear that, faced with the shortfall contended for by the claimant and the lesser shortfall conceded by the Local Authority (which is much greater than the 34 referred to by the First Secretary of State), previously developed land sites inside and outside the urban capacity study were considered by the Inspector and were part of his assessment of the shortfall. It appears that one greenfield site, the substitute for Hadston 2A (see paragraph 72 of the Inspector's report) was, in addition, considered.
36. Accordingly, the Secretary of State appears to be taking the view that there are previously developed land sites, though he does not identify them explicitly, which could come forward to meet what, on his analysis, is a very significant shortfall. Yet these were considered in the Inspector's report and were rejected as adequate. I would have taken some persuading in the light of the detailed consideration of the availability of sites by the Inspector, including previously developed land, allocated and some not allocated, and a further greenfield site that the Local Authority had failed to put forward at least all the previously developed land sites it could. There is also no recorded contention that there was any better greenfield site raised by it; Hadston 2A was considered and rejected as appropriate for these purposes by the Inspector.
37. The extent of the consideration of these other sites was confirmed by a witness statement from Mr Woolf, the claimant's planning expert. He explained the process of examination which he and local authority officers had undertaken before the inquiry in order to narrow the issues. The statement was produced to rebut the contention in Mr Morshead's skeleton argument that part of the First Secretary of State's reasoning was that no comparison for the sequential ranking had taken place. Although that may be true in the urban capacity study sense, and it is not clear to what extent the local authority put forward greenfield sites (save for Hadston 2A substitute), as preferable to the appeal site, the Inspector's report and the witness statement make it impossible for the Secretary of State to contend, on the material before him, that the shortfall could be met by previously developed land whether in or outside the urban capacity study.
38. An analysis of previously developed land of the sort which the Secretary of State refers to could only be relevant on the facts of this case in dealing with a minor shortfall of the sort considered in paragraph 11. He could not possibly have taken the view that the shortfall was as concluded by the Inspector, and have reached the conclusions he did in relation to previously developed land sites coming forward to help make up that shortfall, in the light of what the Inspector had to say about those very sites. Had he taken the view that the shortfall was as the Inspector concluded, which was Mr Morshead's contention, he could not rationally have suggested that previously developed sites would meet it. If he had done so, it would have been a further or alternative error.
39. It would have been perfectly clear that he had given wholly inadequate reasons for adopting the approach he did towards previously developed land in the teeth of the Inspector's conclusions as to their availability and potential. Either he would have ignored the Inspector's conclusions in that respect or failed to give reasons dealing with those conclusions -- again, on an important issue between the parties. Moreover, if the Secretary of State did rely on these largely unspecified, possibly available sites up to 2006, as opposed to referring to a general possibility that something might come forward in a time of less urgency, and if he had relied on sites beyond those discussed at the inquiry, it would have been both unfair and unreasoned. He would have provided no reasons as to why he considered those sites in the light of the examination and agreements at the inquiry as the sites to be examined. It would have been unfair because, given the importance of the efficient conduct of an inquiry, pre-inquiry discussions take place in order to narrow the issues so as to focus on the differences, and with nothing from the Inspector to suggest that the analysis of those sites was inherently inadequate because a class of sites had been omitted, there would have been no reason or policy or practice to require an analysis of sites that were not at issue with the local planning authority. If he relied on matters that were raised, he gave no reasons for his apparent rejection of the Inspector's careful conclusions on those alternative sites. If the Secretary of State relied on matters not raised, he was unfair. I use that analysis, however, not to create an additional flaw, but to point out that it is difficult in the light of that to accept Mr Morshead's primary submission that the Secretary of State had indeed accepted the Inspector's conclusions.
40. I add, bearing in mind Mr Morshead's reference to greenfield sites raised by third parties, that, given the Inspector's acceptance that the appeal site was within the settlement boundaries, was in a sustainable location and was suitable for housing (which must be a reference to some of the criteria in PPG3), there is no basis for a supposition that those greenfield sites referred to by third parties could have been regarded as preferable, or were regarded as preferable by the Secretary of State.
41. There was also a dispute about the significance of paragraph 30.16.9 in the Local Plan, in particular the reference to "longer term" development of the site and "Structure Plan targets". Mr Morshead said that the reference to development in the longer term was a reference to development after 2006, and that this was borne out by references elsewhere in the reasoned justification to other sites. That clearly was the expectation of the Local Plan when it was written, because the Local Plan clearly was premised on the basis that nearly sufficient housing land had been allocated. The appeal site had been in the deposit draft of the Local Plan, but was later removed and had a longer term potential. But obviously that gives it the potential to meet a Structure Plan target if a shortfall eventuates from the failure of other sites to deliver adequately over the plan period. It does not constitute ranking through an urban capacity study, but it is not irrelevant as to how the site could be seen in the event of a shortfall.
42. If the Secretary of State had indeed accepted the Inspector's conclusions in relation to the degree of shortfall, he would again have had to grapple with the true significance of paragraph 30.16.9 and the way in which the site was seen by the Local Authority. The fact that the site had not been ranked with other sites, or had not been allocated as a result of the Local Plan process, did not of itself mean that it should be disregarded by the Secretary of State, whatever the degree of shortfall.
43. Mr Morshead accepted, correctly, that if his arguments on this ground were rejected, it meant that there would be an error of law in the decision or an error of reasoning which would have substantially prejudiced the claimant. Mr Morshead further submitted, however, that if I were against him, as I am, on that issue, I should not quash the decision letter because there are other reasons which the Secretary of State had given: for example, the fact that the land was not previously developed land and was open space, which were independent and sufficient reasons for the refusal of permission. That meant that an error in relation to housing land availability did not lead to the quashing of the Secretary of State's decision.
44. For the reasons which I shall come to later, I do not accept the claimant's arguments on those other grounds. But I do not accept Mr Morshead's submissions that those other points were independent of the First Secretary of State's conclusions on housing land availability. First, as Mr Village rightly points out, the degree of need is intrinsically part of the overall balance between the various competing considerations. It cannot be looked at in isolation. Clearly here the degree of shortfall is relevant to the applicability of the plan, monitor and manage approach, and to the significance of the lack of sequential ranking for Areas 2 and 3. Likewise it is relevant to the degree to which targets in adopted plans, including one which the Secretary of State himself characterised as up-to-date and according with PPG3, should be allowed to be missed on the grounds of possible plan changes, to which his own guidance suggests that little weight should be attached.
45. Second, the degree of shortfall is plainly relevant to the quantum of other land required to meet any shortfall which the Secretary of State accepts or regards as important to meet. The quantum of previously developed land sites which may be available is critical to the apparent satisfaction that they could meet the shortfall, whatever it might have been accepted to be by the Secretary of State, or such part of the shortfall as he thought should be met in the circumstances of the emerging Structure Plan. So the degree of shortfall is very relevant to the potential significance of the availability of previously developed land sites. Previously developed land, which he considers, has to be looked at in the light of the shortfall. The development of a greenfield site may then become necessary. It indicates the degree of interaction between the varying points that arise in the course of an inquiry such as this.
46. Thirdly, there is nothing in the decision letter to show that the other grounds were indeed freestanding and independent conclusions, regardless of the quantity of shortfall.
47. Having pointed out the inherent interaction between need and other considerations, and the solutions to any shortfall which the Secretary of State contemplated, it is relevant to turn to see what the Secretary of State says. Paragraph 7 of the decision letter says:

"The Secretary of State agrees with the Inspector that whether the development of the whole of the appeal site is required to meet the Borough's need for new housing is a major consideration in determining this appeal, but he considers that this issue is heavily dependent upon whether or not the site as a whole consists of previously developed land. The Secretary of State is of the opinion that whether the proposal satisfies PPG3 and the value of the appeal site as open space under PPG17 are also important considerations."

48. This does not support the view that these were independent grounds and that planning permission would have been refused solely on the grounds that Areas 2 and 3 were not previously developed land. What it says is that the weight to be given to need is "heavily dependent" on whether the site consists of previously developed land as a whole. He does not say that the need is independent of whether the land is previously developed land, and the status of the latter, if it is not previously developed land, is determinative of the appeal regardless of the numbers; that is the contrary of what the Secretary of State says. Nor does the Secretary of State consider the issue on a contingent basis, as he did for example in paragraph 21 of his decision letter where he deals with how he would have viewed the development, if he had concluded that Areas 2 and 3 were previously developed land, in terms of any conclusion he might have reached in relation to open space. So I reject Mr Morshead's alternative submission that the other grounds relied on by the Secretary of State were seen by him as independent reasons for dismissing the claimant's appeal.

Previously developed land

49. The second contention relates to the way in which the First Secretary of State dealt with the Inspector's conclusions on whether Areas 2 and 3 were previously developed land. The significance of that conclusion is plain already. Previously developed land has priority for development over greenfield land. PPG3, Annex C, defines previously developed land:

"Previously-developed land is that which is or was occupied by a permanent structure (excluding agricultural or forestry buildings), and associated fixed surface infrastructure. The definition covers the curtilage of the development¹. Previously developed land may occur in both built-up and rural settings ...

The definition excludes land and buildings that are currently in use for agricultural or forestry purposes, and land in built-up areas which has not been developed previously (e.g. parks, recreation grounds, and allotments - even though these areas may contain certain urban features such as paths, pavilions and other buildings). Also excluded is land that was previously developed but where the remains of any structure or activity have blended into the landscape in the process of time ...

¹The Curtilage is defined as the area of land attached to a building. All of the land within the curtilage of the site (as defined above) will also be defined as previously-developed. However, this does not mean that the whole area of the curtilage should therefore be redeveloped. For example, where the footprint of a building only occupies a proportion of a site of which the remainder is open land (such as at an airfield or a hospital) the whole site should not normally be developed to the boundary of the curtilage. The local planning authority should make a judgment about site layout in this context, bearing in mind other planning considerations, such as policies for the protection of open space and playing fields or development in the countryside, how the site relates to the surrounding area, and requirements for on-site open space, buffer strips, landscaped areas, etc."

I point out that the definition of previously developed land ends at the end of the second sentence of the footnote. The rest of the footnote deals with how a site should be developed where not all of the land, although within the curtilage, has in fact previously had buildings on it.

50. It is plain from the definition and the footnote that the question is whether the land in question is "attached" to a building. The balance of the substantive paragraphs of PPG3 were relied on by Mr Morshead for the way in which it showed how historical uses or connections could be lost. I note that it was not contended by him that Areas 2 and 3 were greenfield because of any argument that they were open space or parks. For these purposes, it is necessary to focus on Areas 2 and 3 as the relevant areas. The Inspector dealt with this matter in paragraphs 65, 66 (in part) and 67 of his report:

"65. Some of the land to the south of County Hall is mown but for the most part it comprises rough grassland. There is no physical demarcation between the site and County Hall which dominates this part of the appeal site. There is a line of fence posts along the boundary of Areas 2 and 3 but the wire fence has been trampled down and it does not form a clear boundary. The pond, Catch Burn and the woodland belt form strong, clear boundaries to the land to the south of County Hall.

66 ... However, whilst there is no dispute that part of the site was used as a football pitch, this use ceased over 5 years ago and it is not allocated or protected as such in the Local Plan. The land is used for informal recreation but it is in private ownership and to my mind cannot be classed as a park or recreation ground.

67. This area is not actively used by the County Council. However, there is nothing in Annex C to PPG3 to support the Council's contention that land must be in operational use for it to be in the curtilage of a building. The boundaries of this part of the site coincide with those shown on the planning permission for County Hall. The football pitch was provided for and used by County Council staff and to my mind, the appeal site is historically linked by association and use to County Hall. It can, in my view, be defined as being attached to the building and so lies within the curtilage of County Hall. It follows, therefore, that the whole of the site can be classed as previously developed land as defined in Annex C to PPG3."

51. The Secretary of State rejected those conclusions. He did not accept that Areas 2 and 3 were part of the County Hall curtilage. He set out his conclusions in paragraphs 16 to 19 of the decision letter.

"16. Areas 2 and 3 are open areas that have not been developed. They have no functional, physical or other connection to any buildings(sic) or buildings. Therefore they cannot be classed as previously developed land.

17. The Secretary of State has considered the factors relied-on by the appellants and by the Inspector. He finds none of them to be persuasive. The fact that Areas 2 and 3 were acquired and held in reserve in case the County Council's needs expanded does not, in the Secretary of State's view, produce the result that they should be regarded as attached to any existing building or buildings. At best, it shows that the land was held for the prospect of future attachment; and, in any event, the putative buildings for County Council purposes on these areas would have produced a distinct curtilage or curtilages. The Secretary of State notes that Area 2 was formerly used as a football pitch by employees of the County Council, but that this use and therefore any functional link to County Hall it might have implied ended five years ago. Since then, local residents have used Areas 2 and 3 for the purposes of informal recreation. The Secretary of State attaches weight to this as indicating that even if Areas 2 and 3 may once have had a loose association with any building or buildings on the County Hall site, that association has been severed. The fact that the land where the main County Hall buildings are located is not part of the appeal site further demonstrates that any link between these two areas has been severed. The Secretary of State considers that development on land adjacent to a site does not determine whether the site itself is previously developed land.

18. Even if (contrary to the Secretary of State's view) a historical link "by association and use to County Hall" continues to exist, the Secretary of State's view is that this does not produce a sufficient attachment for the purposes of his policy in Annex 'C' of PPG3. He does not attach significant weight to the fact that Areas 2 and 3 formed part of the site for which the County Council obtained planning permission, because no development has occurred on Areas 2 and 3, nor does he place weight on the red line drawn on a planning application or permission as a reliable guide to a building's curtilage.

19. Moreover, it appears from the evidence before the Secretary of State that the County Council's employees' use of the land for playing football never extended to Area 3. Therefore any functional link between Area 2 and County Hall that might be implied from its former use for recreation by those working in County Hall never extended to Area 3. Although the fence between Areas 2 and 3 no longer remains, except as a line of posts, the Secretary of State disagrees with the Inspector that its existence is a matter of little weight: its presence reinforces the lack of any link, even an historical one, between Area 3 and County Hall ..."

52. Mr Village's first contention was that there had been a breach of the provisions of Rule 17(5) of the Town and Country Planning (Inquiries Procedure) (England) Rules 2000 (SI 16/24), which breach, he submitted, had substantially prejudiced the claimant for the purposes of section 288 of the 1990 Act. The relevant rule provides:

"(5) If, after the close of an inquiry, the Secretary of State -

(a) differs from the Inspector on any matter of fact mentioned in, or appearing to him to be material to, a conclusion reached by the Inspector; or

(b) takes into consideration any new evidence or new matter of fact (not being a matter of government policy);

and is for that reason disposed to disagree with a recommendation made by the Inspector ..."

53. Essentially, the Secretary of State must notify the parties of the disagreement with the Inspector and give them the opportunity for further representations. It is clear that the First Secretary of State disagreed with the Inspector's conclusions as to curtilage and was for that reason, if no other, disposed to disagree with his recommendation. The issue between the parties was whether the disagreement involved the First Secretary of State differing from the Inspector on "any matter of fact", and if so, whether the claimant had been prejudiced by any subsequent failure to follow the Procedure Rules. Mr Village identified the "matter of fact" as being not so much whether the land was previously developed land, but whether it was within the curtilage of County Hall, and in a more refined way, whether the areas were "attached" to the buildings represented by County Hall. Mr Village submitted that whether for these purposes land was attached to, and formed thereby part of, the curtilage of a building, was a question of fact. Mr Morshead submitted that it is a question of evaluation or planning judgment.
54. The second contention of Mr Village, which it is convenient to adumbrate here, was that the Secretary of State's conclusion that Areas 2 and 3 were not part of the curtilage involved an error of law because he disregarded the relevance of the past relationship between the land and the buildings, the continuing historical link, the physical and geographical relationship and facts in respect of the past functional links.
55. For Mr Village's first contention, he relied on the judgment in particular of Goff LJ in Methuen-Campbell v Walters [1979] 1 QB 525, in particular at 528. This was a decision under the Leasehold Reform Act 1967 and was concerned with whether a paddock was within the curtilage of the house so that it could be enfranchised with it. After reference to dictionary definitions, which were said not to be helpful, Goff LJ said at page 538E:

"What is within the curtilage is a question of fact in each case, and for myself I cannot feel that this comparatively expensive piece of pasture ought to be so regarded, particularly where, as here, it was clearly divided off physically from the house and garden right from the start and certainly at all material times."

56. Mr Village relied on both the conclusion that what was within the curtilage was a question of fact, and the importance of physical division as showing that land was not within the curtilage -- division which he said was absent here.
57. Mr Morshead emphasised the citation by Goff LJ of a passage from the judgment of Upjohn LJ in Clymo v Shell-Mex & BP Ltd (1963) 10 RRC 85, referred to at page 538H. In that judgment, Upjohn LJ said:

"The whole problem is a question of mixed fact and law but depends very largely on the facts. Provided a piece of land satisfies the concept of being an appurtenance, it is a question of fact and circumstance whether it is an appurtenance."

58. Goff LJ continued:

"In my judgment, for the reasons which I have given, this piece of land does not satisfy the concept of being an appurtenance but what the position will be in other cases will depend first upon the question of law whether the piece of land in question does satisfy that concept, and secondly whether on the facts of the particular case it ought to be regarded as an appurtenance.

For these reasons I would allow the appeal, discharge the declaration that has been made and substitute the counter-declaration which I have read."

59. Roskill LJ described the question of whether land was within a curtilage as being a mixed question of law and fact. Relevant to the second point, but I deal with it here, is what Buckley LJ said at page 543F to 544C in which he sets out various matters, relevant to the conclusion to whether land is part of a curtilage or not:

"What then is meant by the curtilage of a property? In my judgment it is not sufficient to constitute two pieces of land parts of one and the same curtilage that they should have been conveyed or demised together, for a single conveyance or lease can comprise more than one parcel of land, neither of which need be in any sense an appurtenance of the other or within the curtilage of the other.

Nor is it sufficient that they have been occupied together. Nor is the test whether the enjoyment of one is advantageous or convenient or necessary for the full enjoyment of the other. A piece of land may fall clearly within the curtilage of a parcel conveyed without its contributing in any significant way to the convenience or value of the rest of the parcel.

On the other hand, it may be very advantageous or convenient to the owner of one parcel of land also to own an adjoining parcel, although it may be clear from the facts that the two parcels are entirely distinct pieces of property. In my judgment, for one corporeal hereditament to fall within the curtilage of another, the former must be so intimately associated with the latter as to lead to the conclusion that the former in truth forms part and parcel of the latter.

There can be very few houses indeed that do not have associated with them at least some few square yards of land, constituting a yard or a basement area or passage way or something of the kind, owned and enjoyed with the house, which on a reasonable view could only be regarded as part of the messuage and such small pieces of land would be held to fall within the curtilage of the messuage.

This may extend to ancillary buildings, structures or areas such as outhouses, a garage, a driveway, a garden and so forth. How far it is appropriate to regard this identity as parts of one messuage or parcel of land as extended must depend on the character and the circumstances of the items under consideration. To the extent that it is reasonable to regard them as constituting one messuage or parcel of land, they will be properly regarded as all falling within one curtilage; they constitute an integral whole."

60. It is plain from what he said that neither, for example, a common demise nor a common occupation of land is of itself decisive. Nor is the convenience or necessity of one for the full enjoyment of the other. What is required is an intimate association to such a degree that the one forms part and parcel of the other, properly to be regarded as an integral whole.
61. Next in this context I was referred to the Attorney General ex rel. Sutcliffe v Calderdale Borough Council [1983] 46 P&CR 399. This case concerned the curtilage of a listed building and whether an unlisted terrace of cottages was within the curtilage of the listed mill. Just as part of the judgments in Methuen-Campbell take their colour from the context of leasehold enfranchisement, so too part of what is said in the Calderdale case takes its colour from facets particular to listed buildings, especially historical connections and setting. Methuen-Campbell's case and, in particular, what Buckley LJ had to say, was cited extensively and with apparent approval in this context. It was agreed that three factors, in particular, were relevant. Stephenson LJ at page 407 referred to the importance of the physical "layout" of the listed building and the structure, ownership past and present, and use or function past and present. I note, however, what he said at page 408. He identified that different facts may lead to different conclusions and the same facts may lead to different judicial opinions, a point which he illustrated by cases which he cited. He concluded at paragraph 409 that:

"The terrace has not been taken out of the curtilage by the changes which have taken place, and remain so closely related physically or geographically to the mill as to constitute with it a single unit and to be comprised within its curtilage in the sense that those words are used in this subsection."

I note that because of the emphasis Mr Morshead placed on the context of the examination of this issue.

62. Finally, I was referred by Mr Morshead to Skerritts of Nottingham Limited v Secretary of State for the Environment, Transport and the Regions [2001] QB 59. This was again a decision on the meaning of curtilage in the listing building context. Walker LJ said at page 61 and emphasised at page 67 that what was within a curtilage was a question of fact and degree.
63. I do not accept Mr Village's contention that there was a breach of the Procedure Rules. It all depends on whether the Inspector's conclusion that Areas 2 and 3 were attached to, and within the curtilage of, County Hall was a finding of fact within the scope of Rule 17(5). The question of what is a "finding of fact" or a "fact" depends on the context. I recognise that there is seeming support from what Goff LJ and others have said in other contexts for Mr Village's proposition, but that has to be qualified by the references to fact and degree, the context, and by the recognition in those cases that there was a two-stage process which involved examining whether something was capable of being within the curtilage, and a second stage of whether it actually was within it. The former was a question of law; the latter a question of fact or fact and degree. There is no simple answer to the question of what is a matter of fact which does not change from legal context to legal context. Much depends on what the question of fact is contrasted with. Where the contrast is between a question of fact or fact and degree and a question of law, it is easier to see what is a question of fact or degree by the contrast to a question of law. Here the question is whether this was a finding of fact or not, the latter not being delineated further.
64. The context is the Procedure Rules requiring a further opportunity for representations to be given if the Secretary of State is differing on one particular type of issue. The issues at a planning inquiry can be seen as arising on a spectrum of fact, fact and degree, the appraisal of primary facts for planning significance, the weighing of those factors and the reaching of conclusions on a range of issues or a policy judgment. There are no sharp-edged distinctions between those various types of issue. Where the conclusion on an issue involves the appraisal of a primary fact for its planning significance, I do not consider that the conclusion on that issue is a finding of fact for these purposes.
65. Here the Inspector's conclusion involves findings of fact, primary fact, as can be seen in most of paragraphs 3 and 65 of his report, at least the last two sentences of paragraph 66 and parts of paragraph 67. All those primary facts were then evaluated and weighed through a planning perspective as to whether, taken in the round, those primary facts meant that land was attached to or within the curtilage of County Hall within the context of PPG3, Annex C. This overall evaluation I regard as falling outside the scope of the Procedure Rules' findings of fact.
66. What I see as primary facts here, eg whether the land had been used as a soccer pitch, what its actual current use was, were not rejected by the Secretary of State. The Secretary of State evaluated differently, but again from a planning perspective, the primary findings of fact which the Inspector had made as to what had happened, what currently happened on the land, how the land physically related to County Hall, as well as the Inspector's evaluation of the significance of a planning approval and application. This illustrates the distinction in relation to a single fact, which feeds into the overall evaluation. He reached a conclusion as to what was on a planning application, which was a matter of primary fact. He also reached a conclusion as to its significance for the answer to the question of whether the land was within the curtilage or not. The judgment as to significance is not a matter of fact but of planning evaluation.
67. If I am wrong about that, and the Inspector had reached a finding of fact in respect of curtilage, and therefore there was a breach of the Procedure Rules when the Secretary of State reached a different conclusion without complying with Rule 17(5), I would not grant relief unless the claimant had been substantially prejudiced by that breach. Mr Village suggested that, had his client been given the opportunity to do so, he would have added submissions. In particular, he would have requested the decision officer to go and see the site for herself, which in fact she had not done. But I do not consider that the opportunity for the decision officer to visit the site at the claimant's request, which is the opportunity essentially foregone, gives rise to any substantial prejudice. First, as I have said, there was no differing by the Secretary of State from any primary findings which the Inspector reached in his report. Secondly, the reasons for the difference, or for either the Inspector or the Secretary of State's conclusions, were not ones which were essentially visual matters which required a site visit for their proper appreciation. Nor indeed were the points made by Mr Village when he came to attack the substance of the Secretary of State's conclusions, ones which involved a visual appreciation of the site. The issue was one of what can properly be regarded as planning judgment about the weight to be given to, for example, historical associations, the cessation of a historical association, the significance of a planning application or of prospective uses that may not have taken place.
68. Mr Village suggested that there had been a use of Area 3 for a soccer pitch in part, or for golf use. But with respect to him, that is to miss the point of Rule 17. The Inspector made no findings that that was the case. Rule 17 is not, and cannot be, a basis for persuading the Secretary of State not to differ from the Inspector, nor a basis for attempting to improve on the findings which the Inspector has made.
69. I also reject the criticisms made of the substance of the Secretary of State's conclusions. I am far from clear that, even if there were substance in the criticisms from a planning point of view, that they could amount to an error of law or deficiency of reasoning in this case. First, as I have said, the First Secretary of State took the primary facts and weighed them differently, for adequately explained reasons, in reaching his own conclusion. He did not, for example, ignore the physical connection between the appeal site and County Hall, that is to say that there was continuity and that they were not separated by a physical barrier. The Secretary of State was entitled to take the view that mere continuity did not go very far in the context of land surrounded by other land, and although, for example, there was a belt of trees to the southern boundary, there was no evidence that there was a fence there. Nor did the Secretary of State ignore the past links between Area 2 and County Hall. There was no finding of fact by the Inspector to support the contentions that Area 3 had been used in part for a soccer pitch or golf area. The notations on the proposed landscape plan were not necessarily the result of survey and may not help.
70. The Secretary of State did not treat the historic link, such as it was, as legally irrelevant; he treated it as of limited value when it had existed on what the Inspector had to say, and of no real weight now that it was over, again in the light of what the Inspector had to say about the fact of current use. PPG3, as Mr Morshead pointed out, illustrates how past links can be eroded for these purposes.
71. The Secretary of State was entitled to reject the red line around a previous planning application as significant. Indeed, the force of that can be seen from the way in which the current application site does not conform to that previous application site, in that it includes Area 1 and an area within its Area 2 which was not within the earlier red line. Mr Village's criticism that the Secretary of State had engaged in what he described as "slicing salami" is not correct. The Secretary of State has set out his view in the round on the various relevant factors for consideration.
72. Although I accept what is said in the authorities to which I have referred, that the cessation of the common ownership and the cessation of a functional link does not mean that land cannot be so closely related physically and geographically to a building as to constitute a single unit, this does not mean that the converse is also true, especially where there is no continuing functional link, as the Secretary of State was entitled to conclude. The question of whether land is now so closely related as to constitute a single unit is what has to be examined. The Calderdale case recognised that there could be a physical link reflecting a historic but not continued function, but that turned on its combination of facts.
73. The Secretary of State has not ignored the physical relationship, which continues, and the absence of a barrier between the appeal site and County Hall. Nonetheless, it was, in my judgment, wholly open to the Secretary of State to conclude as he did in relation to the weight which he attached to the various components, which required to be examined in relation to this issue. He did not ignore any that were relevant and reached a conclusion on them in the round which, in my judgment, cannot be challenged. This analysis also illustrates the need to draw a distinction of the sort which I have done when considering the procedural contention.

Open space

74. I turn next to open space, the final area of challenge. Mr Village took two points. The first was that the Inspector had not given limited weight to the overall sports provision proposed by the claimant, but only to the new pitch provision. Accordingly, the First Secretary of State had misunderstood the report and ignored the other benefits put forward by the claimant, in particular the £300,000 contribution towards the provision of new changing rooms away from the appeal site.
75. The second contention was that the First Secretary of State had ignored the fact that the area used for informal recreation on the appeal site was private land, albeit that the owner, Northumberland County Council, was a public body. It was not held as public open space and any informal use was precarious and could end with a change of owner or of land management.
76. As to the first contention, I accept that the provision of replacement pitches and new changing rooms for the one pitch which had existed on the appeal site but no longer did was the response to the objection raised by Sport England. The provision overcame that objection and was seen by Sport England and by the local authority (paragraph 80, 4th sentence of the Inspector's report) as a benefit. The Inspector said:

"79. ... To my mind, the provision of these formal spaces with guaranteed public access would compensate for the loss of the current, informal arrangement.

80. ... There is nothing to show that the football pitch would [not] be reinstated should this appeal be dismissed. To this extent, I afford limited weight to the planning obligation but I am mindful that the proposed facilities at Morpeth Common are supported by the Council's Playing Pitch Strategy and the Sports Council. Indeed, the Council accept that the proposed contribution to new sports pitches and changing rooms would be a benefit ..."

77. I accept that there is a proviso in the Inspector's comment in paragraph 80 that he affords limited weight to the planning obligation "to this extent", and that that relates to the prospect of pitch replacement and pitch reinstatement on site, and that he nonetheless still sees the proposal as bringing a recreational benefit; (the insertion of the word 'not' in the second sentence of paragraph 80 is agreed to be necessary. Its omission was a typographical error).
78. In paragraph 21 of the decision letter, the Secretary of State makes no reference to the benefit afforded by the provision of changing rooms. He says:

"21. He notes that Sports England withdrew their objection to the application; but he agrees with the Inspector that the provision of new football pitches at Morpeth Common, which precipitated the withdrawal of their objection, should be given only limited weight for the reasons given by the Inspector. The Secretary of State does not consider that new football pitches would compensate for the existing use made of Areas 2 and 3 by local residents for informal recreation. The Secretary of State does not agree with the Inspector that the provision of smaller areas of formal open space within the proposed development would compensate for the loss of amenity to local residents as they would be both significantly smaller and different in character than the existing open space."

79. Crucial to the Secretary of State's judgment was the significance of the loss of open space with the recreational potential for a pitch and informal uses which he saw the appeal site as affording. The Secretary of State is focusing, in particular, on the loss of open space and the inadequacy of alternative provision within the developed appeal site. The existence of changing rooms for proposed new pitches did not really grapple with his concern. It is to him, on his approach, a small point, albeit a material consideration, but it is not one which requires any special mention. I do not accept that the Secretary of State misunderstood the nature of the benefits. He is instead placing his focus on the open space aspect.
80. As to the second contention, it is of course quite common for privately owned land to be subject to precarious informal recreation. Clearly there is no guarantee in relation to its continued use, as the Inspector implicitly accepted when he contrasted that with the guaranteed position which would be achieved in relation to the recreational areas provided within the development.
81. The Secretary of State, in paragraphs 21, 22 and 28 of the decision letter, referred to the loss of open space provided to residents on Areas 2 and 3 as if, submitted Mr Village, it was not at risk and could be presumed to continue. But first the Inspector himself implicitly concludes with his reference in paragraph 80 to the fact that "there is nothing to show that the football pitch would [not] be reinstated should this appeal be dismissed" that there was no imminent threat to use by the public. He would not otherwise have given weight to the fact that the football pitch might well be reinstated, thereby limiting the weight he gave to the replacement. There was no assertion or evidence to show that, if the appeal were dismissed, Northumberland County Council either intended to divest itself of the land to an owner who would block public access or to change its land management so as to achieve the same result. Such evidence would be regarded with caution anyway. In effect, in the absence of such evidence accepted by the Inspector or the Secretary of State, the Secretary of State was entitled to approach the continuation of informal recreation as if there were no identified threat or substantial reason as to why it should not continue. In any event, a local authority owner might have a different approach to public access from an ordinary private owner anyway.
82. It was for the claimant to make out the point that the informal recreation would cease by reference to evidence. Absent that, there was no error of law or material consideration ignored in the Secretary of State approaching matters on the basis that the informal recreation, although not guaranteed, would continue. Of course, if that turns out to be erroneous, that can always be pointed out whenever the land comes up for future consideration.
83. However, for the reasons which I have given, this decision is quashed.
84. MR WHITE: My Lord, I am obliged. I appear for the claimant this morning. Mr Blundell appears for the First Secretary of State. My Lord has indicated that the decision will be quashed and on that basis I ask for the principle of costs in this matter. Secondly, My Lord, in view of your Lordship's observations in respect of ground 1, I ask, my Lord, that costs be assessed on that ground on the indemnity basis rather than the standard basis.
85. MR JUSTICE OUSELEY: Why?
86. MR WHITE: I do not know whether my Lord needs to be taken to the case of Kiam.
87. MR JUSTICE OUSELEY: I think if you are making an application for indemnity costs you are going to have to persuade me. So what is Kiam?
88. MR WHITE: I will hand it up, My Lord. My Lord, it is a decision of the Court of Appeal, which stated in the head note on page 2 that, in order for an applicant to succeed in an order for indemnity costs, the conduct of the losing party would need to be unreasonable to a high degree; not merely wrong or misguided in hindsight. My Lord, I refer to the judgment of Simon Brown LJ (as he then was) at paragraph 12 where he said:

"I for my part, understand the Court there [in an earlier case of re Minty] to have been deciding no more than that conduct, albeit falling short of misconduct deserving of moral condemnation, can be so unreasonable as to justify an order for indemnity costs. With that I respectfully agree. To my mind, however, such conduct would need to be unreasonable to a high degree; unreasonable in this context certainly does not mean merely wrong or misguided in hindsight. An indemnity costs order made under Rule 44 (unlike one made under Rule 36) does, I think, carry at least some stigma. It is of its nature penal rather than exhortatory."

89. My Lord, in view of your Lordship's observations, firstly that it was surprising -- I think your Lordship said "very surprising" -- this critical issue as to housing need was not dealt with at all and the housing shortfall was not grappled with at all in the decision letter. That is the first point, my Lord. Secondly, the argument that was put before your Lordship on behalf of the First Secretary of State your Lordship indicated was not justified on the basis of the evidence set out in the decision letter. On that basis I say that we have reached that threshold set out in Kiam.
90. MR JUSTICE OUSELEY: Thank you. Mr Blundell, deal with the principle first and then indemnity costs.
91. MR BLUNDELL: My Lord, in view of the principle, we do not object to an award of costs. We do, however, object to an order of indemnity costs on ground 1 on the quite simple ground that the conduct here does not get anywhere near the high threshold applied in Kiam.
92. MR JUSTICE OUSELEY: I am inclined to agree with you. I do not think there is very much you can say. You have made your points.
93. There will be an order for costs to be assessed. Not merely do I not think that the conduct of the Secretary of State reaches the high threshold, I do not think there was anything irresponsible about it to attract a penal point. But I thought, if I might say so, Mr White, it was a little bold as you had lost on the other issue. You can have Kiam back. I will not say "better luck next time".