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 WC2A 2LL
		20 September 2007

1. THE DEPUTY JUDGE: This case raises a short point on the proper interpretation of the phrase "industrial process" in Article 2 of the Town and Country Planning (Use Classes) Order 1987.
2. The claimant Council seeks, under section 288 of the Town and Country Planning Act 1990, to quash the decision of an Inspector allowing the appeal of Wickham Laboratories Limited, the second respondent, against the claimant's decision refusing to grant a certificate of lawful use or development. The Inspector's decision letter on this matter was dated 16 November 2006.
3. Before I go any further, it would be useful to set out the relevant parts of the Use Classes Order. I start with Article 3 because that is essential to understand the working of the order. Article 3(1) "Use classes":

"Subject to the provisions of this Order, where a building or other land is used for a purpose of any class specified in the Schedule, the use of that building or that other land for any other purpose of the same class shall not be taken to involve development of the land."

I do not think paragraph (2) matters. Paragraph (3) has been referred to in argument as has paragraph (4):

"(3) a use which is included in and ordinarily incidental to any use in a class specified in the schedule is not excluded from the use to which it is incidental merely because it is specified in the schedule as a separate use.

(4) where land on a single site or on adjacent sites used as parts of a single undertaking is used for purposes consisting of, or including, purposes falling within classes B1 and B2 in the schedule, those classes may be treated as a single class in considering the use of that land for the purposes of this order so long as the area used for a purpose falling within Class B 2 is not substantially increased as a result."

There is no reason to recite any of the further subsections of that article.

4. The issue in this case is whether or not what was being undertaken on part of Torbay Farm amounted to an "industrial process. "Industrial process" is defined in Article 2, the interpretation article, in these words:

"'industrial process' means a process for or incidental to any of the following purposes: -

(a) the making of any article or part of any article ..."

and the rest of that does not matter. I do not think it is necessary to recite (b) or (c) either, but the article then continues:

"in the course of any trade or business other than agriculture, and other than a use carried out in or adjacent to a mine or quarry;"

I also note that site is defined as:

"site" means the whole area of land within a single unit of occupation.

5. The decision letter is a short one and briefly recites the issues and the facts. I am going to go straight to it. First of all, under "Background", to describe Torbay Farm and what it did, I turn to paragraph 2, which reads as follows:

"Prior to 1971 Torbay Farm was a conventional poultry egg production unit. At around that time Wickham Laboratories identified a demand for disease free fertile poultry egg cell culture media to be used in the production of human and animal live viral vaccines. The regulatory agencies require the culture media, which includes the cells within the 'chorio-allantoic' membrane of the egg's embryo, to be produced free from specific pathogens.

3. Buildings E and F were converted into sealed isolator units for the production of fertile 'Specific Pathogen Free' (SPF) eggs, with building A used for administration, building B for general maintenance, building C for quality assurance and building D for the storage and packing of eggs ready for delivery to clients. The flocks were thus housed in a fully microbiological environment, with a pressured air supply filtered to 0.003 microns and maintained at 12C ± 0.5 C. All materials entering or leaving the units passed through fumigation cells or two-way chemical dump tanks. Poultry food was specially compounded, vacuum packed and irradiated or gassed with methyl bromide. Staff entry to the units was via a complete shower and change procedure, and cooking, washing and toilet facilities for the technician were provided within each isolator.

4. To ensure continuing status as a SPF flock 5% were blood tested each month in accord with the relevant protocol and each sample tested for 22 different pathogens. Further clinical examination was carried out at least once a week to verify that the birds were free from fowl-pox and signs of other infections. Any positive finding of disease meant that the entire flock could no longer be designated as an SPF flock. The cost of routine blood testing alone was some £250,000 per annum, with laboratory testing equating to 60-70% of total production costs. The eggs for vaccine purposes sold for about £1 each, with smaller numbers purchased by universities and research establishments at around £3 each."

The Inspector then turns to consider the unlawful use in paragraph 5:

"The parties are agreed that this does not constitute an agricultural use, and I share the view of the Inspector in 2005 that the primary use should properly be described as the production of SPF eggs through the breeding, hatching, rearing and keeping of poultry within a controlled environment. The use continued for more than 10 years without enforcement action and had therefore, in relation to that part of the Torbay Farm used for the purpose of the production of eggs (and its ancillary uses) become lawful. Although production ceased in 1999 it is common ground that the use has not been shown to have been abandoned. It is dormant and the use therefore subsists.

6. The issue in this case is whether the use falls within Class B1(c) since if it does so, a use within Class B1(b) would also be lawful."

The inspector continues 7 to 13:

"7. Class B1(c) covers a use 'for any industrial process, being a use which can be carried on in any residential area without detriment to the amenity of that area by reason of noise, vibration, smell, fumes, smoke, soot, ash, dust or grit'."

[I note that definition, which I did not read out in my setting out of the Use Classes Order. That is because the reference to a residential area is not something that is in contention, as will shortly appear.]

6. The Inspector goes on to define an industrial process and it is not necessary for me to repeat that. I turn next to paragraph 8:

"I deal first with the Class B1 proviso 'being a use which can be carried on in any residential area without detriment ...', since it is now agreed between the principal parties that this requirement is met..."

She turns to the concerns of local residents briefly saying she has no reason to differ from the Council on the issue of interference with amenities. In paragraph 9 she continues:

"Turning to the process which took place, this focused on the production of the SPF eggs, with the chorio-allantoic sac of the incubated embryos to be used, off site, as a live cell media in the production of vaccines. The fundamental purpose of these SPF eggs was for vaccine production, and this was the only site in the UK supplying such eggs. In the terms, however, of subsection (a) of the UCO interpretation of industrial process this process, despite being carried out in a fully barriered microbiological environment, cannot to my mind be considered in itself as the 'making' of an article. The eggs were produced rather through the natural production activity of breeding, incubation, hatching, and rearing, albeit in an environment that was managed in a particular way with the aim of achieving and maintaining a disease free flock.

10. I appreciate that the document introduced by Mr Hardy which, amongst other things, regulates SPF egg media production, the 'Orange Guide', speaks throughout of 'manufacturing'. Paragraph 34 of Annex 5, for example, under the heading of 'Manufacture of Immunological Veterinary Medicinal Products' refers to the 'method of manufacture' and paragraph 35 expressly refers to eggs from SPF flocks as a 'starting material'. EU guidelines have been reviewed since the previous inquiry. There is new guidance on 'starting materials' and paragraph 1.1 states that 'manufacturing' includes 'all operations of ... production... of active substances'. Such definition, however, is wide and even though the process at Torbay Farm would have amounted to 'manufacturing' in pharmaceutical terms I share the concerns as to its application in planning terms. The word is not used in the UCO.

11. The judgment in Powell v the SSE and Maidstone BC [1992] in relation to the breeding of worms for the conversion of rabbit droppings to compost refers to a use which was 'like an industrial process'. Neither Powell, however, nor in Salvatore Cumbo V SSE and Dacorum BC [1991] where it was held that milk production and the manufacture of soft cheese would be in the nature of a mixed farming and manufacture use, bear close comparison since to my mind it was the "starting material", namely the SPF egg, which was produced here and not the end product, the vaccines. Whilst it is certainly the case that regular monitoring and testing, including the candling, described in detail by Mr Dyer, was essential in the requirement for constant quality and maintenance of SPF status, the primary purpose on the appeal land was the production of the SPF eggs. The human intervention was to prevent interference by pathogens."

7. I now go to paragraph 12, which I preface by saying that this is the paragraph that is at the heart of this decision letter, and is the one that is particularly criticised on behalf of the claimants by Mr Clarke:

"Be that as it may, the UCO definition of industrial process means a process for 'or incidental to' the making of any article. The SPF eggs as a matter of fact and degree were produced for, and were thus incidental to, the vaccine production which took place elsewhere and by others. Notwithstanding that these eggs were fit for human consumption there is no evidence that the eggs were produced for any other purpose than the vaccines. Up to around one million eggs per year were sold to companies including such as The Welcome Foundation, Intervet and Glaxo Speke, and to the Central Veterinary Laboratories, Weybridge, University Research Departments and others. The production of vaccines as an industrial process is not in question.

13. Although mindful of the Council's view that the mining of coal for example would be incidental to the production of tyres, it is pertinent to note that the UCO imposes no geographical limit on where the process has to be or who has to carry it out. Whilst the word "site", moreover, has a distinct definition for the purposes of the Order, the word is not used in the interpretation of 'industrial process' and neither is it used in Business Class B1. As incidental to the vaccine production the use, as a matter of fact and degree, amounted in my view to an 'industrial process' in the terms of the UCO. I conclude that the lawful use thus falls within Class B1(c). It must follow that permitted development rights would allow a change to Class B1(b) use."

8. The Inspector then concluded that the Council's refusal to grant a certificate of lawful use or development was in consequence not well-founded and that the appeal should succeed. The certificate then followed, signed by the Inspector, certifying that:

"The lawful use of the land falls within Class B1(c) of the Town and Country Planning (Use Classes) Order 1987. The land can therefore be lawfully used for Class B1(b) purposes for research and development by virtue of the Town and Country Planning (General Permitted Development) Order 1995".

and that was dated 16 November 2006.

9. Mr Clarke, on behalf of the Winchester City Council, says that this decision is outside the powers of the Act and the Inspector has gone wrong in law because, he says, one use cannot be for, or incidental to, a use that takes place on a different planning unit. In support of that proposition he refers to the well-known authorities about the definition of planning units. I single out the cases of

Brazil (Concrete) v Amersham RDC [1967] 18 P&CR 396 and Burdle v the Secretary of State [1972] 1 WLR 1207. Mr Clarke draws attention to the definitions in those cases, which examined the proper definition of the planning unit, and he takes me to the quote from Bridge J in Burdle, of which I shall read just a very short section at 1212. Bridge J said:

"What, then, are the appropriate criteria to determine the planning unit which should be considered in deciding whether there has been a material change of use? Without presuming to propound exhaustive tests apt to cover every situation, it may be helpful to sketch out some broad categories of distinction.

First, whenever it is possible to recognise a single main purpose of the occupier's use of his land to which secondary activities are incidental or ancillary, the whole unit of occupation should be considered. That proposition emerges clearly from G Percy Trentham Ltd v Gloucestershire County Council [1966] 1 WLR 506…"

He then quotes what Diplock LJ said in that case. I do not think it is necessary for me to read that quotation.

10. What Mr Clarke says is that those cases show, quite clearly, that when considering the definition of the planning unit and whether or not an incidental use is part of a main use or primary use on such a unit, it is established that an incidental use cannot be treated as part of a use that is on a separate planning unit. The incidental use and the primary use must, for the purpose of the definition of the planning unit, be together on the same unit.
11. He says that it would be very surprising if, given that interpretation of incidental, Parliament had intended that, when it used the word "incidental" in the definition of industrial process in the Used Classes Order, that word should have some different shade of meaning. It would lead, he said, to a difficult result and anomalies. He pointed out that the word is also used in Article 3(3) of the Use Classes Order. He sought to say that that provision would also be difficult of application if 'incidental' were not used in the same way that it is used in the authority's that deal with the definition of the planning unit.
12. Mr Clarke says that if I were to take a different view, he would raise the further point that the way that the Inspector has interpreted in the English word "incidental" in paragraph 12, is not a proper way of interpreting it. He draws my attention to the definitions in the Shorter Oxford English dictionary.
13. In their very helpful skeletons Mr Paul Brown, for the Secretary of State, and Mr Malcolm Spence QC and Mr Asitha Ranatunga, for the second defendants, Wickham Laboratories, make it plain that there is no disagreement with Mr Clarke's interpretation of the use of the word "incidental", so far as it relates to those cases that are concerned with the proper definition of the planning unit. However, they say that the claimant's argument is fundamentally misconceived. They say that when seeking to identify the primary use of a planning unit that has got several different uses on it, the principles that are set out in Brazil v Amersham and Burdle v the Secretary of State are directly relevant, applicable and undoubted.
14. A main use may have many identifiable other uses serving it and incidental to it, for example, to take an illustration that has been the subject of debate this morning, an industrial use may have a canteen, medical facilities, storage, transport, maintenance facilities and a host of other things all capable of being defined as separate uses, but all undoubtedly "incidental" to the main industrial use. Examination of the planning unit may reveal all of those ancillary or incidental uses as being an incident of the main use. In which case the main use of all will be industrial. The canteen will be as industrial as the steer rolling mill, in that sense.
15. It is agreed that in those circumstances the incidental uses must be altogether within one planning unit to be part of the main use. But, they say, those authorities are of no relevance to the definitions in the Use Classes Order.
16. Mr Brown adds in his skeleton that if the claimants were right, the argument would leave the Use Classes Order sterile and pointless. If in order to be an industrial process the use had to be for, or incidental to, an industrial process and on the same planning unit, it would be part of the same planning unit and part of the same use any way. So the Use Classes Order would be completely otiose.
17. I entirely agree with the arguments of both the first and second defendants. Mr Clarke's submissions are indeed fundamentally misconceived. The decisions and the principles developed to enable the sensible identification of the planning unit and its use are of no relevance when the issue is not what is the planning unit and what is its use, but the quite different issues raised by the application of the Use Classes Order. The Use Classes Order is there to facilitate sensible changes in use when the broad nature of the use does not change. Hence, Article 3 declares that changes to different purposes within the same class shall not be taken to involve development.
18. To that end classes have to be specified as including certain processes. The processes themselves are defined. The question is not, at that stage: what is the unit and what is its use? The question is: given a known unit, is its use to be classified in such a way as to include it with other processes, so as to form a class within which movement from one process to another will not involve development? The words "industrial process", it seems to me, in the Use Classes Order pose a straightforward and recognised class identified, or capable of being identified, in a straightforward way. The definition is simply that "'industrial process' means a process for, or incidental to", and then follow a number of given purposes. The exercise is simply for the decision-maker to look at the planning unit in question and then ask himself the question: is the use of it for, or incidental to, for example, the making of an article?
19. The answer to that, it seems to me, must involve an understanding of the normal English words "for or incidental to" and an assessment, as a matter of fact and degree, of all the circumstances of the uses that are taking place upon the planning unit that is being considered. If the answer to that is, 'Yes, what is happening on the planning unit is, as a matter of fact and degree, a process that is for, or incidental to, the making of an article, albeit on a different planning unit", then the answer is clear and the fact that it is on a different planning unit, in my view, need not cause the slightest concern. It causes no problem that the site to which the land in question is incidental may be distant, or indeed that there may be more than one such site, as the Inspector clearly held was the case in the instant circumstances. The question is simply: what is taking place on the land "for, or incidental to, the making of any article"? If so, it is an industrial process and it is within the relevant business class.
20. The Inspector in paragraph 12 approached the matter in a way that seems to me to be entirely open to him. He gave a perfectly normal English word a normal English meaning. That meaning is quite within the first definition of incidental that Mr Clarke showed me, namely "occurring, or liable to incur, in subordinate conjunction with something else of which it forms no essential part". That seems to me to be a perfectly acceptable way of interpreting and then applying that word.
21. The Inspector looked at the circumstances as a matter of fact and degree, as he was fully entitled to do. The circumstances that he took into account are all clearly set and the judgment he made was entirely open to him. It is not suggested that the decision was an irrational one that no Inspector properly directing himself could reach. Whether or not something is incidental or not is a matter of fact and degree for him. His approach was not wrong in all the circumstances of this case. It was entirely open to him to say, as he did, that the use was incidental to an industrial process. The rest followed because the other requirements were agreed.
22. I find there to be no valid criticism of the Inspector's decision and for that reason this application is dismissed.
23. MR BROWN: My Lord, I am very grateful. I will ask, in the circumstances, for the Secretary of State's costs of defending the application. Your Lordship should have, I hope, a schedule of costs from the Secretary of State. You will see that the total there is £5,792. I would ask for our costs to be summarily assessed in that amount.
24. THE DEPUTY JUDGE: Yes. Mr Spence, are you going to make an application?
25. MR SPENCE QC: I shall. I appreciate I have a rather more onerous task than my learned friend.
26. THE DEPUTY JUDGE: I think that is probably right.
27. MR SPENCE QC: We are going to take two points. Might I preface them by reminding your Lordship of what the White Book says? I see your Lordship has no copy up there.
28. THE DEPUTY JUDGE: I have the 20O5 book lurking down here. If you can tell me where to go in it.
29. MR SPENCE QC: It is paragraph 54.16(7)on costs. I only need the last sentence from Bolton:

"The courts may award two sets of costs where the interested party [that is me] deals with a separate issue not dealt with by the defendant or where the defendant and the interested party have separate and distinct interests..."

Now in this case, I urge the two points. We wrote and submitted our skeleton argument eight months ago, my Lord, deliberately to give the claimants a good opportunity to consider and withdraw. I have to say also, my Lord, quite frankly, because this point was raised by the Inspector, neither my learned friend, Mr Clarke, nor I, who appeared at the inquiry but without my junior, were able to make full submissions about the meaning of the definition "industrial process", in particular, not condescending to any law, which plainly could not be looked up overnight.

30. In fact neither my learned friend, Mr Brown, nor I have been called upon. Your Lordship has castigated the case as being fundamentally misconceived. It demonstrates, my Lord, that the claimants should, in my submission, have withdrawn, especially being given that full opportunity of considering a fairly lengthy skeleton, then our costs would not have been incurred. Also noting, of course, it is generally the second defendant's costs, which in these cases are rather more substantial than the first.
31. Secondly, we have taken, and looking at the White Book more especially now, extra points. We have, as your Lordship has seen from the skeleton, provided a fuller exposition on the law as to the meaning of the industrial process, that is the only law that there is, which happens to relate to rating and the meaning of industry there and is identical.
32. THE DEPUTY JUDGE: I have read those.
33. MR SPENCE QC: More especially on our case about exercising the court's discretion. The only thing that has gone wrong with this morning, if I may say, my Lord, is that I have been deprived of the opportunity of presenting that with which I hoped to fascinate your Lordship. The case became much better last night than it is on the written skeleton.
34. Also I make a smaller point that since I was at the inquiry there was the opportunity, which did not occur, for the need to tell the court about what happened. Anyway, for those reasons, my Lord, I would respectfully urge your Lordship to award two sets of costs. I say nothing about the amount thereof for the time being, unless your Lordship would like me to?
35. THE DEPUTY JUDGE: Shall we deal with the principle, first of all, and then we can come back to the order of costs later? Mr Clarke, do you want to say anything to me about Mr Brown's costs?
36. MR BROWN: No, my Lord.
Judgment on costs
37. THE DEPUTY JUDGE: The Secretary of State shall have its costs and they will be summarily assessed at £5,792. As for Mr Spence's costs on behalf of Wickham Laboratories, I have been helpfully reminded of Bolton Metropolitan District Council v Secretary of State for the Environment [1995] 1 WLR 1176. and Mr Spence puts his argument on both legs of that: there being a separate issue not dealt with by the defendants, or where there are separate and distinct interests which require separate representation. I think perhaps the main weight on the first point is the point that is fairly made by Mr Spence, that they put in the skeleton at a very early stage with the view of persuading the claimants that the point was, as I have found it is, to be one that is fundamentally misconceived. They then certainly elaborated the point in a way that was, as I have seen in the skeleton, interesting and takes it a bit further.
38. However, the point about a point that is fundamentally misconceived is that it is one that in many cases, and certainly this is such a case, can be quickly seen to be so. Those in a position of Wickham Laboratories, who see the Secretary of State's skeleton and see that the point is forcefully taken by, in this case Mr Brown, should properly feel that they need not appear and they can safely leave it to the Secretary of State. While Mr Spence's further arguments were interesting, the fundamental point, it seems to me, was the killer and the Secretary of State was well able, and conspicuously able, to deliver that killer blow.
39. For those reasons I do not think that Mr Spence falls within the exceptions to the general rule, which is that normally the unsuccessful claimant should not be expected to pay two sets of costs. This is not the sort of case, it seems to me, where Mr Spence was presenting something that was completely separate and really within the knowledge of Wickham Laboratories alone, and could not be left entirely to the Secretary of State. Those are the reasons why I am not prepared to order the claimants to pay two sets of costs.
40. Very well. Thank you very much indeed. Thank you to all counsel for your assistance because I read the very helpful skeletons, even though I did not call upon you.
41. MR CLARKE: I have to ask for permission to appeal from you. I do so in trepidation as you made the point that it is fundamentally misconceived. However, then if we want to argue a different view we have to ask for permission.
42. THE DEPUTY JUDGE: You will not be surprised that I am going to refuse you permission. It is (a) hopeless and (b), in so far as it is not hopeless, it is entirely a matter on the facts. If you wish to interest the Court of Appeal in it, by all means have a go, but I am not going to give you permission.