England and Wales High Court (Administrative Court) Decisions

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

		Birmingham Civil Justice Centre
		20/12/2016

Mr Justice Holgate :

Introduction

1. In 2011 the Kings Head Inn in Tewkesbury Road in the village of Norton closed. It had been a thriving public house for many years but trade declined and a succession of owners were unable to make a success of it. The village has a population of only about 300 people.
2. The Claimant, New Dawn Homes Limited, bought the entirety of the site some time before the end of 2013. The site included to the east of the pub an area which had been used as a car park and to the west the former beer garden.
3. On 10 October 2013 the Claimant applied to the Second Defendant, Tewkesbury Borough Council ("TBC") for full planning permission for the construction of 4 new dwellings on what was described as "Land at Kings Head Inn, Old Tewkesbury Road, Norton". TBC granted permission on 10 December 2013. This is the site of the former car parking area lying to the east of the Kings Head and occupies 6.2ha. The approved drawings provide for a new access onto Tewkesbury Road. Between the site and the pub building lies the existing access for the Kings Head. Condition 12 required the developer to provide 18 car parking spaces to the south of the pub building as shown on drawing "116-01 Rev. 2". Access to these spaces would be gained through the existing vehicular entrance to the King's Head. The spaces were to be provided on land in the ownership or control of the Claimant (ie. land lying within the conventional blue line shown on one of the application drawings - see paragraph 3.4 of the Claimant's statement in support of its section 78 appeal referred to in paragraph 6 below).
4. The statutory development plan comprises the saved policies of the Tewkesbury Borough Local Plan 2011. Policy HOU13 states that in order to address the need for more affordable housing in the Borough, TBC "will seek to negotiate with developers for the provision of an element of affordable housing on sites of 15 or more dwellings or on sites in excess of 0.5 hectare. Within settlements with a population of 3,000 or fewer, the threshold will be 5 dwellings". Because taken in isolation the 2013 application only sought approval for 4 dwellings, planning permission was granted without any requirement that affordable housing be provided.
5. On 11 July 2014 the Claimant applied to TBC for a further detailed planning permission for the erection of 4 new dwellings on "land at Kings Head Inn, Tewkesbury Road, Norton", but this time on the area of land laying to the west of the public house, which had formerly been used as its beer garden. The area of this site is 0.17ha. The application proposed that access to this area would be through a small residential cul-de-sac, King's Elm. Mr Anthony Crean QC, who appeared on behalf of the Claimant, confirmed that before the application was made, his client had obtained legal control over land in third party ownership in order to be able to provide this access. TBC concluded that taking the two development sites together, the 4 dwelling threshold for the provision of affordable housing was exceeded and an appropriate contribution should be made. The Claimant disagreed, but it is said that in order to avoid delay a commercial decision was taken to accept the Council's stance. Accordingly, the Claimant entered into a planning obligation under section 106 of the Town and County Planning Act 1990 ("TCPA 1990") to make a contribution of £118,400 towards the provision of affordable housing off-site and planning permission was granted on 1 May 2015. I note that condition 9 required 30 parking spaces to be provided to the south of the pub building before any of the 4 dwellings could be occupied, instead of the 18 spaces required by condition 12 of the 2013 permission.
6. On 15 June 2015 the Claimant made a further application for a full planning permission for the erection of 4 dwellings on the former beer garden land. The application sought approval for a slightly different layout of one of the four dwellings (or more precisely its garage). Initially the Claimant offered to make the same contribution towards the provision of off-site affordable housing, but it is said that, because of delays on the part of TBC, that offer was withdrawn. Consequently, on 19 January 2016 TBC issued a decision notice refusing planning permission solely on the ground that the application failed to propose any contribution to affordable housing. That refusal became the subject of an appeal under section 78 of TCPA 1990 to the first Defendant, the Secretary of State for Communities and Local Government ("SSCLG").
7. The appeal was dealt with by the written representations procedure and the Inspector appointed by the SSCLG to determine the appeal on his behalf issued a decision letter on 6 July 2016. The Claimant now seeks to challenge that decision by an application for statutory review under section 288 of the TCPA 1990. On 12 October 2016 Green J ordered that the application for permission under section 288 (4A) be dealt with at a rolled-up hearing, which came before me.
8. I am grateful to all Counsel for their written and oral submissions.

The grounds of challenge

9. The Claimant's arguments have been put differently over time, but they were refined by Mr Crean QC to raise two alternative grounds:-

Ground 1

On a true interpretation policy HOU13 does not provide for the aggregation of areas of land for development when applying the threshold for the provision of affordable housing and therefore the Inspector erred in law by treating each of the two development areas as forming part of a larger site.

Ground 2

If on a true interpretation policy HOU13 does allow the affordable housing threshold to be applied to aggregated areas of land, it only allows this to be done prospectively and not retrospectively. In other words, aggregation is only possible in relation to areas where a residential planning permission has yet to be granted. It does not allow the aggregation of land with other land on which a planning permission for residential development has already been granted.

General legal principles governing a challenge under section 288

10. The principles upon which the Court may be asked to quash a decision of a planning Inspector are well-established and were summarised by Lindblom J (as he then was) in Bloor Homes East Midlands Limited v SSCLG [2014] EWHC 754 (Admin) at paragraph 19).
11. The most authoritative statement on the general legal approach to be taken to the interpretation of a planning policy is set out in Tesco Stores Limited v Dundee City Council [2012] PTSR 983 at paragraphs 17 to 22. In summary, the interpretation of policy is a question of law for the Court to determine objectively in accordance with the language used. But development plans and other policy documents are not analogous in their nature or purpose to a statute or contract and should not be construed as if they were. Furthermore, many policies are framed in language the application of which to a given set of facts requires the exercise of judgment. Matters of that kind fall within the jurisdiction of planning authorities as decision-makers and their exercise of judgment may only be challenged in the Courts if it is irrational or perverse.
12. It is therefore essential for those seeking to challenge an Inspector's decision, to respect this distinction between interpretation and application of policy. In the latter type of case the limited basis upon which the Courts may intervene was summarised in Barker Mill Estates Trustees v Test Valley Borough Council and SSCLG [2016] EWHC 3028 (Admin) (at paragraphs 22 to 26). The above principles were matters of common ground in this case.

The parties' cases in the planning appeal and the Inspector's decision

13. In its written statement on the planning appeal the Claimant accepted that three criteria drawn from the decision in R (Westminster City Council) v First Secretary of State and Brandlord Limited [2003] J.P.L 1066 should be applied in order to determine the factual question of whether two development proposals could be aggregated or considered to form part of a larger whole (paragraphs 7.11, 7.16 and 8.2). Those criteria were ownership, whether the areas of land could be considered to be a single site for planning purposes, and whether the development should be treated as a single development. Using those criteria, the Claimant made representations to the Inspector as to why in the circumstances of this case, the two areas of land the subject of separate planning permissions/applications should be treated as separate sites for the purposes of applying the affordable housing threshold. It was submitted, for example, that TBC had failed to pay sufficient regard to the fact that the access point for the development of the beer garden was in separate ownership (paragraphs 7.12 to 7.15).
14. Having submitted that the two areas of land should be treated as separate sites and not aggregated, applying the criteria taken from Brandlord, the Claimant went on to make legal submissions which cover substantially the same issues as grounds 1 and 2 in this case (paragraphs 7.21 to 7.27). Paragraph 7.28 argued that the two areas could not be considered to be "adjoining" within the meaning of the explanatory text to Policy HOU3. However, the normal meaning of "adjoining" includes "neighbouring" land. That term is not restricted to parcels of land which are contiguous or which abut each other. Accordingly, Mr Crean QC did not pursue this last point.
15. The written representations by TBC also focussed on the three criteria used in the Brandlord case (paragraphs 6.20 to 6.23). They argued that if land owners are able to subdivide sites artificially then they could succeed in avoiding requirements for the provision of affordable housing and make it difficult for the authority to secure any such housing in rural settlements (paragraph 6.24).
16. Given the approach taken by the parties, it is not surprising to find that in his decision letter the Inspector first dealt with the application of the three criteria in Brandlord (DL 7 to DL 11). He concluded that, as a matter of judgment, the two areas for housing development should be considered as part of the overall area of land formerly occupied by the Kings Head Inn. He then went on to reject the Claimant's contention that the "explanatory text" accompanying policy HOU13 should be treated as an improper attempt to create an additional policy not contained within HOU13 and therefore be disregarded (see DL 12). Grounds 1 and 2 are essentially directed to this latter part of the decision along with DL 14.
17. Mr Crean QC confirmed that the Claimant does not raise any legal challenge to the content of DL 7 to DL 11. It is useful at this point to set out those paragraphs as they form part of the context for the arguments which the Claimant has pursued in this claim:-

"7. The appellant argues that the two sites on which dwellings are being constructed should not be considered a larger whole for the purposes of seeking contributions towards affordable housing. In order to determine whether two sites are part of a larger whole for the purposes of the provision of affordable housing, my attention has been drawn to the High Court Judgment in respect of Westminster City Council v FSS and Branlord which suggested three ways in which a conclusion might be reached on the matter: whether they are in single ownership; whether they constitute a single site for planning purposes; and whether the proposals can be deemed to constitute a single development. I have attributed considerable weight to this approach in my consideration of the appeal before me.

8. In respect of the first point, whilst the majority of the two sites and the King's Head Inn are in single ownership, the appellant argues that the access point to the appeal site is in different ownership and therefore is an important consideration of whether the application proposal is part of a larger whole. However, in my experience, it is not uncommon for small parts of larger sits to fall under different ownership. I do not agree that the separate ownership of a relatively small area of land would, by itself, render the whole of the appeal site to fall in separate ownership to the King's Head Inn and the site to the north east for the purposes of the Branlord test. When viewed as a whole, the vast majority of the three sites are all in the same ownership.

9. With regard to the second point, the two housing sites and the King's Head Inn are physically independent of each other and they have their own access points. However, the two housing sites previously formed part of the car parking and amenity area for the public house. It is not in dispute that it was a single unit at the time. Therefore, I consider that they do form a single site for the purposes of planning, albeit it is split into three separate elements.

10. Turning to the third and final point, I note the appellant's contention that the two housing sites and the King's Head Inn site have their own accesses and are independent of each other with the two housing sites capable of being developed entirely separately from each other. However, when taking into account the dwellings on both sites would be of a very similar design and layout and are within close proximity of each other, albeit separated by the public house, they would be read as the same overall development of the King's Head Inn site. Furthermore, I noted during my site visit that the two sites are being constructed simultaneously and within the same building site perimeter with a single access point. Whilst my decision does not turn on this point, it does add weight to my findings that the two sites should be considered as part of a larger whole.

11. I accept that the two sites are windfall sites. However, I find that they are the subdivision of a larger site. Whether or not the overall King's Head Inn site was an allocated site, its boundaries can be simply defined. In addition, in my experience, it is not uncommon for allocated sites to have multiple access points, a factor which by itself is not determinative in considering it as a single site."

The Brandlord case

18. At this stage it would be helpful to set out what the Brandlord case dealt with and to make clear what it did and did not decide, especially as it does not appear to have been the subject of any further decision in the Courts. Three adjoining buildings in a terrace had been used as offices. Two had been altered substantially so as to be physically interdependent. The only link with the third property was formed by interconnecting doorways on several levels, which could easily be blocked up (paragraphs 2 to 4). On the same date the first two buildings were sold to one company and the third to a different company. The two companies had the same directors, shareholders, company secretary and registered office (paragraphs 5 to 6). Separate planning applications were submitted to convert the two interdependent properties into 12 flats and the third property into 9 flats (paragraph 7). On the same date Westminster City Council granted planning permission for the two properties to be converted into 12 flats subject to two of the units being provided as affordable housing and for a 7 flat scheme in the third property (paragraphs 9 to 10). The owner of the two properties, Brandlord, appealed against the Council's refusal to grant permission for the conversion without a requirement for affordable housing (paragraphs 10 to 11).
19. Westminster's Unitary Development Plan contained a general policy for seeking the provision of affordable units in "substantial housing developments". It does not appear that the plan defined that expression or set out any thresholds for the application of the policy (paragraph 14). Basing itself on DETR Circular 6/98, Westminster adopted an interim policy, which appears to have been non-statutory, which incorporated the thresholds in the Circular including "developments of 15 or more dwellings". They added a further criterion to enable them to require the provision of affordable housing where (inter alia) development taken in isolation fell below the threshold, but in reality represented a phase of a larger development falling above the threshold (paragraphs 15-16). A draft replacement of the UDP contained a policy to the same effect as the interim policy. So the position was that the only policy upon which the authority was able to rely was contained in non-statutory documents (paragraph 17). The issue in the appeal simply related to the way in which the Inspector applied this "phasing" provision in the policy.
20. The Inspector thought that there were three routes by which it might be possible to conclude that the appeal scheme on the two properties formed part of a larger whole which included the conversion of the third property, that is to say single ownership of the properties, the properties constituting a single site for planning purposes, or the proposals being deemed to constitute a single development (paragraph 20). The Inspector considered that the properties were nominally in different ownerships. Even if they had been in the same ownership he concluded that that would be insufficient by itself to establish that the three properties constituted a single site or that their conversion to residential use amounted to a single development. There was no issue between the parties in the case about that point (paragraph 22). As to the "single site for planning purposes" criterion, the Inspector found that because the third property was only linked to the other two by doorways (which could readily be blocked up), and the planning permission for office use was personal to the former occupier and had therefore lapsed, he was not persuaded that the three properties constituted a single site (paragraphs 23 to 25). He then concluded that the proposals should not be treated as a single development because the two permissions could be carried out independently and did not share any essential facilities or services (paragraph 27). The Inspector therefore allowed the appeal by Brandlord, with the consequence that no affordable housing was required to be provided.
21. The challenge by Westminster City Council in the High Court to that decision involved only two grounds. No objection was raised to the Inspector's reliance upon the three criteria he identified in his decision letter. Maurice Kay J (as he then was) rejected the complaint that the Inspector failed as a matter of fact to consider all three criteria in combination (paragraphs 36 to 39). He also rejected the argument that when considering the "single development" criterion, the Inspector had improperly relied upon a distinction between allocated sites and windfall sites which was not contained in the authority's affordable housing policy. The judge held that the Inspector had simply made a factual point that where an area of land formed part of an allocation in a local plan it could be easier to forge a link between separate proposals coming forward from within that boundary (paragraphs 32 to 35). He held that the Inspector had made no suggestion that windfall sites could not satisfy the "phased development" criterion or ever form part of a larger whole.
22. The Judge appreciated that the City Council was concerned that the Inspector's decision might compromise its ability to provide affordable housing through property owners slicing up landholdings and submitting separate, consecutive applications, but in paragraph 42 he made it plain that both the decision of the Inspector in that case and the Court's own judgment were "highly fact dependent", adding:-

"I do not see that either should be viewed as providing a ready means of undermining the affordable housing policy."

The Court made no criticism of the Inspector's decision to use the three criteria upon which he based his decision, nor did it say that those three criteria were mandatory, or that there might not be other relevant criteria according to the circumstances of the case.

23. It is clear from the Tesco case that the Inspector's decision to use those three criteria involved the use of his judgment in the application of the "phased development" criterion in the local planning policy. Such a judgment could only have been criticised on grounds of irrationality (which might include a failure to take into an "obviously relevant" consideration – see R (Faraday Development Limited) v West Berkshire Council [2016] EWHC 2166 (Admin) at paragraphs 132 to 134), or taking into account a consideration which was legally irrelevant. No such challenge was made in Brandlord. It is the very nature of the exercise of judgment or discretion, that a range of different conclusions may lawfully be open to different decision-makers presented with a given set of circumstances or facts (see eg. Secretary of State for Education and Science v Tameside MBC v [1977] AC 1014, 1064E-F). Thus, Brandlord did not lay down any principle or rule that circumstances of the kind there considered must be treated as involving separate developments for the purposes of applying an affordable housing policy threshold. All that happened in the present case was that the parties were content to present their respective cases under the same three criteria and the Inspector chose to reach his decision by reference to those three criteria. As a matter of legal principle a different Inspector presented with the same facts as in Brandlord might have come to a different conclusion. Similarly, Mr Crean QC was entirely right not to challenge the conclusion reached by the Inspector in this case on the grounds that it was irrational.

R (Orbital Shopping Park Swindon Ltd) v Swindon Borough Council

24. In his oral submissions Mr Crean QC took as his starting point the decision of Patterson J ([2016] PTSR 736; [2016] EWHC 448 (Admin)) for the principle that outside the statutory code relating to environmental impact assessment for "projects", there is no legal basis for reading two or more planning permissions together as if they were one permission (see paragraphs 53 and 71). But in my judgment that issue does not arise in the present case and the decision in Swindon does not assist the Court to resolve the issues raised in this challenge.
25. The Swindon case was concerned with the application of the Community Infrastructure Levy Regulations 2010 (SI 2010 No. 948). Two planning permissions were granted for works to a shop unit in a retail park, one for the installation of a mezzanine floor and the other for external alterations which were related to those internal works. If the first permission were to be taken in isolation from the second, no CIL charge would be payable under the statutory scheme in respect of either permission. If on the other hand, as the local planning authority contended, the two permissions were to be treated as a single permission, then a CIL charge would be due (see paragraphs 30 and 36).
26. The Court held that, according to the legislation, the ability to charge CIL depended upon the definitions in the regulations of (a) "chargeable development", namely "that for which planning permission is granted", and (b) "planning permission" (see paragraphs 57 to 58). The liability to pay a CIL charge did not depend upon any statutory question as to whether, for example, "development" proposals or schemes, or land for development, or even planning applications, should be read together, or treated as forming part of a single whole. It was for these reasons that Patterson J found it necessary to consider whether two (or more) separate planning permissions could be treated as one. She concluded that there was nothing in the CIL regulations, or in other legislation to which they referred, which permitted any such interpretation of the statutory code (paragraphs 59 to 62). She also held that it was axiomatic that a planning permission is generally interpreted on the face of the document within its four corners and that there was nothing in the mezzanine permission itself to link it with the second permission for external works (paragraph 53).
27. The issues involved in the Swindon decision on the CIL regime do not arise in the present case. The Inspector here did not have to consider whether two planning permissions should be read as one. Instead, the issue for him was whether the development of the former beer garden should be treated as forming part of the development of a larger area of land or site which included the former car park of the Kings Head Inn. Indeed, the issue for the Inspector was whether he should allow the section 78 appeal and grant planning permission for the proposal without affordable housing on the area of the former beer garden. It was no part of his task to consider, for example, whether the 2013 and 2015 planning permissions (the latter of which did include a requirement for affordable housing in any event) should be treated as one planning permission.
28. As I have said, the issue in Swindon was not something which the Inspector in this case had to decide, nor does it arise for the Court to consider in this challenge. Indeed, if a general inability to treat two or more planning permissions as one were to be dispositive in the present case, logically it ought to have been dispositive in the Brandlord case, irrespective of the terms of the local authority's planning policies. In other words, there would have been no need for the Inspector or the Court in Brandlord to consider the application of the three criteria used in the decision letter. If it is simply a matter of interpreting the scope of a planning permission, the relevant legal principles were established long before Swindon, and the Inspector's decision letter in that case could no doubt have been written on a single sheet of paper.
29. A much more serious consequence of seeking to apply the principle in the Swindon case to the legal issue which arises here, is that landowners and developers would be able to avoid thresholds for the provision of affordable housing simply by the way in which they decide to divide up an area of land and apply for planning permissions. Maurice Kay J did not consider that the decision in Brandlord gave rise to that risk (see paragraph 22 above). I think that remains the case. In part that is because what has been decided by the Court in Swindon does not determine the merits or demerits of a local planning authority's case on how a threshold for the provision of affordable housing is to be applied.

Whether aggregation needs to be dealt with in a development plan

30. Thresholds for the provision of affordable housing are generally contained in development plan policies. No doubt that is desirable in order to give an appropriate degree of certainty for landowners, developers and the public. But the original UDP policy in the Brandlord case did not specify a threshold or the amount of affordable housing to be provided (see paragraph 14). It is trite law that whether a factor is a material consideration for the exercise of development management powers is not dependent upon whether it is referred to in the development plan or some other planning policy statement. Essentially, the materiality of a consideration simply depends upon whether it relates to the use and development of land (Stringer v Minister of Housing and Local Government [1970] 1 WLR 1281, 1294-5; Westminster City Council v Great Portland Estates plc [1985] AC 661, 669-670.
31. Mr Crean QC submitted that if the "aggregation" of land for the purposes of applying an affordable housing policy were to be the subject of a policy in the statutory development plan, then that would be a material consideration for the decision-maker, but not otherwise. For the reasons set out in paragraph 30 above I am very doubtful as to the soundness of his suggested distinction and on the limited argument presented in this case I am not prepared to accept it. Given the breadth of the concept of what may qualify as a material consideration, I do not see why, for example, a decision-maker could not rely upon the three criteria used in the Brandlord decision in order to decide whether or not development should be aggregated, irrespective of whether that specific subject is dealt with in the development plan. However, in order to deal with the Claimant's two grounds of challenge, I do not need to decide whether the distinction put forward by Mr Crean QC is correct.

Ground 1

32. It is necessary to set out Policy HOU13 of the local plan and the accompanying explanatory text in full:

"POLICY HOU13

THE OVERALL BOROUGH-WIDE TARGET FOR THE PROVISION OF AFFORDABLE DWELLINGS DURING THE PLAN PERIOD IS ABOUT 1320 DWELLINGS TO BE DELIVERED THROUGH THE LOCAL PLAN. THIS WILL BE SOUGHT WITHIN THE FRAMEWORK SET BY NATIONAL PLANNING POLICY GUIDANCE, GOVERNMENT CIRCULARS AND OTHER ADVICE.

THE BOROUGH COUNCIL WILL SEEK TO NEGOTIATE WITH DEVELOPERS ON ALLOCATED AND UNALLOCATED HOUSING SITES TO PROVIDE LOW COST MARKET AND/OR SUBSIDISED HOUSING THAT WILL BE AVAILABLE TO HOUSEHOLDS WHO CANNOT AFFORD TO RENT OR BUY HOUSES AVAILABLE IN THE EXISTING HOUSING MARKET.

IN ORDER TO ADDRESS THE DEMONSTRATED LACK OF AFFORDABLE HOUSING ACROSS THE BOROUGH, THE BOROUGH COUNCIL WILL SEEK TO NEGOTIATE WITH DEVELOPERS FOR THE PROVISION OF AN ELEMENT OF AFFORDABLE HOUSING ON SITES OF 15 OR MORE DWELLINGS OR ON SITES IN EXCESS OF 0.5 HECTARE. WITHIN SETTLEMENTS WITH A POPULATION OF 3,000 OR FEWER, THE THRESHOLD WILL BE DWELLINGS.

Reasoned Justification

The Tewkesbury Borough Housing Needs Survey (ORS 1998) identified a shortfall of social housing within the Borough of 551 dwellings 1998-2003. This figure was projected forward to arrive at a total of 1322 dwellings 1998-2011. The requirement for social housing is only one component of overall housing market requirements identified by the Housing Needs Survey. As the Local Plan will not provide sufficient affordable housing to meet needs during the plan period, in order to be realistic in terms of likely provision during the plan period, the requirement for social housing figure is used as a proxy for total affordable need. More updated information on affordable housing needs provided in the Ark Report (2000) confirmed that this target was reasonable.

Registered Social Landlords (RSLs) have a vital role in the delivery and management of affordable housing, although the Council as housing authority will also seek to harness the potential of other modes of delivery, as appropriate and through the use of targeted programmes. Where RSLs are not involved, planning decisions for affordable housing would need to include arrangements to control occupancy in accordance with advice set out in paragraph 12 of Circular 6/98. Housing requirements will vary across the Borough in relation to the operation of local housing markets and certain areas are influenced by the close proximity of Gloucester and Cheltenham and hope values. In all cases sites will be assessed in relation to the Housing Needs Survey, updated as appropriate by local surveys and other relevant information. Existing housing market partnership initiatives will be fostered and developed, so that the assessment and delivery of affordable housing in market areas, especially where they straddle administrative boundaries, will be more effective.

Affordable housing is defined in terms of the relationship between housing costs and household incomes rather than by specified tenures, and is housing that is provided at a cost which would be accessible to those households identified as being in housing need and currently excludeD from participating in the market because of their lack of resources. It can be provided as both housing for rent and as low cost home ownership (either as shared ownership, other forms of low cost home ownership, or low cost market housing for sale). Within the context of the local housing market in the Borough, affordable housing is defined as representing a home ownership at a price for a two bedroom property, equivalent to 2.5 times average household income in Gloucestershire for: (a) household comprising 1 full-time skilled manual worker and 1 part-time semi-skilled manual worker or, (b) a rent level equal to or less than the Housing Corporation rent cap. The appropriateness of the affordability definition will be kept under review; if necessary the Council will seek to bring forward an updated formula, either by means of Supplementary Planning Guidance or as part of a formal review of the Plan.

The guiding criteria for negotiations on the provision of affordable housing are set out in paragraph 10 of the Circular 6/98. Affordable housing will normally be subsidised to meet these affordability criteria. Where affordable housing needs can more effectively be met elsewhere other than on the potential development site under consideration (either on an alternative site or within a nearby settlement perhaps with a better range of facilities), then, exceptionally, the Borough Council may be prepared to negotiate ways of securing alternative provision elsewhere. There will also be other potential sources of supply that may help to meet the need for affordable dwellings, for example, making the best use of existing stock and/or conversions of existing buildings. The Housing Strategy Statement, combined with regular monitoring, has an important role to play in the overall approach to the provision of affordable housing. The Borough Council will seek to ensure that designs and layouts seamlessly integrate affordable housing and general market housing on sites.

In terms of the appropriate size threshold for windfall sites above which affordable housing contributions will be negotiated, Circular 6/98 advises schemes of 25 or more dwellings, or sites of 1 hectare or more. A lower threshold may be appropriate where local exceptional constraints can be justified, provided it is not less than 15 dwellings or 0.5 hectare. Within those settlements in rural areas with populations of 3000 or fewer, the local planning authority should adopt appropriate thresholds. Given the small number of large windfall sites which come forward in either the bigger parishes or those of less than 3000 population (a figure which is likely to further diminish as a consequence of the policies of this local plan), a relatively low threshold is appropriate in order to address part of the shortfall of identified housing needs particularly in those parts of the Borough where there is little scope for securing affordable accommodation by any other means. For this reason, the policy refers to a threshold of 15 dwellings, and 5 dwellings within smaller settlements. In all cases sites will be assessed against the detailed findings of the Housing Needs Survey, updated as appropriate by the Ark Report, local surveys and other relevant information.

An application for planning permission for development which forms part of a more substantial potential development on the same land or adjoining land, will be treated as an application for planning permission for the more substantial development. In respect of high-density specialist housing, neither the local plan policy nor government advice exempts specialist sheltered housing from affordable housing requirements. The Borough Council will consider the level of need for such housing in the area, and whether the proposed units will be affordable in terms of the definition of affordability. Further guidance will be contained in the proposed affordable housing SPG." (emphasis added)

33. Grounds 1 and 2 arise from DL12 of the Inspector's decision letter in which he stated:-

"Policy HOU13 of the Tewkesbury Borough Local Plan to 2011 (the 'Local Plan') requires that for development in villages with a population of less than 3000 the threshold for affordable housing provision is five dwellings. The explanatory text to this policy states that an application for planning permission which forms part of a more substantial potential development on the same land or adjoining land will be treated as an application for planning permission for the more substantial development. I note the appellant's contention that this section of the explanatory text introduces a new policy provision. However, I do not agree with this view as it merely provides clarification that such sites will be considered as a more substantial development, which is also further expanded upon in the Tewkesbury Borough Council Affordable Housing Supplementary Planning Guidance (SPG). The requirement for affordable housing for development of more than five dwellings is clearly set out in the policy wording itself. Whilst Policy SD13 of the emerging Cheltenham Gloucester Tewkesbury Joint Core Strategy (JCS) includes a similar clarification within the actual wording of the policy, this does not necessarily mean its position in the explanatory text to Policy HOU13 is incorrect."

34. It is trite law, and common ground in this case, that the policy for the purposes of the statutory development plan is that which is separately identified as such, eg. by the use of capital letters in HOU13. Mr Crean QC submits that there is nothing in the policy itself which allows the decision-maker to aggregate areas of land when applying the threshold for affordable housing, for example, by aggregating the land the subject of the section 78 appeal with the land the subject of the 2013 permission, or the developments permitted or proposed on those areas. Relying upon R (Cherkley Campaign Ltd) v Mole Valley District Council [2014] EWCA Civ 567, he submits that the last paragraph of the explanatory text, which does deal with aggregation, is to be treated as legally irrelevant, because it improperly purports to add requirements which are not, and ought to have been, contained in the policy itself. He submits that this is properly to be treated as an issue of interpretation of the text for the Court to determine, and to that extent I agree with him.
35. The Cherkley case was concerned with a legal challenge to the grant of planning permission for a golf course. The local plan policy dealing specifically with such applications contained 8 or so criteria for assessing the acceptability of such proposals, none of which required that the need for any such new facility be shown. However, the accompanying explanatory text contained a requirement that the need for a new facility should be demonstrated by an applicant seeking planning permission. The Court of Appeal rejected the argument that the permission should be quashed on the grounds that (as was agreed as a matter of fact), when deciding that the proposal did accord with the development plan for the purposes of section 38(6) of the Planning and Compulsory Purchase Act 2004 (PCPA 2004), the local planning authority had failed to consider whether a need for the golf course had been made out.
36. In summary, the Court of Appeal held that:-

(i) A local plan must contain a written statement of the local planning authority's detailed policies for the development and use of land in its area. It may also contain such descriptive or explanatory material as the authority thinks appropriate (section 36(2) and (6) of PCPA 2004). Regulations require a local plan to contain a "reasoned justification" for the policies in the plan which must be set out so as to be readily distinguishable from the other contents of the plan (see regulation 7 of the Town and County Planning (Development Plan) (England) Regulations 1999 – SI 1999 No. 3280);

(ii) The supporting text of the local plan consists of a reasoned justification and any descriptive or explanatory material for a policy. Whereas that text is relevant to the interpretation of the policy to which it relates, it is not itself a policy or part of a policy, it does not have the force of policy and cannot be used to trump policy (paragraph 16);

(iii) That analysis remains the same even if the local plan expressly states that the supporting text indicates how the policies of the plan will be implemented (paragraph 16);

(iv) When determining whether a proposal does or does not accord with the local plan for the purposes of section 38 (6) of PCPA 2004, the correct focus is on the policies in the plan for the development and use of land. For example, it cannot be said that a proposal which is judged to accord with the policies of the local plan, is not "in accordance with the [development] plan" because it does not comply with an additional criterion contained solely in the supporting text (paragraph 16);

(v) Explanatory text or reasoned justification cannot operate independently so as, for example, to impose a "policy requirement" that the identified policies of the local plan do not contain (paragraph 17);

(vi) Because the reasoned justification or explanatory material may be used as an aid to the interpretation of a policy, it can have the effect of altering the interpretation of what that local policy would otherwise mean if considered in isolation (paragraph 18).

Thus, the reasoned justification can affect the correct interpretation of a requirement contained in the policy, but it cannot impose an additional requirement outwith the policy itself.

37. I do not accept the Claimant's argument that the principles laid down in the Cherkley decision renders the last paragraph of the explanatory material legally irrelevant because it crosses the line between providing assistance on the meaning of a policy and the insertion of an additional policy requirement not contained in the policy.
38. Policy HOU13 states that TBC will seek to negotiate with developers for the provision of (i) an element of (ii) affordable housing on (iii) sites in excess of stated thresholds. However, the policy itself supplies no definitions for what is to be treated as "affordable housing", or the "element" which is required or to be negotiated, or the meaning of "sites".
39. Mr Crean QC argues that the word "sites" should be treated as limited to the site which is the subject of the planning application under consideration. In effect he asks the Court to read in the word "application", or to substitute the phrase "an application site" for "sites". No doubt the language used in the policy, "sites", includes "an application site", but the Claimant's argument seeks to read in additional wording with the result that the scope of the policy becomes more limited than it would otherwise be. On a natural reading of the policy the choice of the phrase "on sites" allows, for example, the considerations applied in the Brandlord decision to be taken into account so that the decision-maker may consider whether a particular application site should properly be treated as part of a larger area with a greater housing capacity.
40. I am reinforced in this view by looking at the phrase "on sites" in context. The policy in fact refers to "sites of 15 or more dwellings". The policy does not use language such as "a site with 15 or more dwellings as defined by the proposal put forward in a planning application". Take, for example, a case where there is no issue that the relevant area to be considered is that put forward in the planning application, but whereas the proposal is for 14 dwellings, the local authority justifiably considers that that same site has a capacity for 15 (or more) dwellings. I do not consider that the wording of HOU13 indicates that, for the purposes of section 38(6) of PCPA 2004, the decision-maker would have to treat the site as being a "site for 14 houses" just because that is how the planning application has been put forward. The effect of that interpretation of policy HOU13 would be to allow developers artificially to circumvent its purpose by the way in which their planning applications deal with the density of development proposed for the site, or indeed the area of land chosen to form the application site. Instead, the correct approach to the interpretation of the phrases in the policy "an element", "affordable housing" and "sites" or "sites of 15 or more dwellings" is that judgment is involved when they each come to be applied.
41. By contrast, Mr Crean QC did accept that it had been permissible for the explanatory text accompanying HOU13 to supply a definition of "affordable housing". It does so in some considerable detail. He accepted that although "affordable housing" is not defined in the policy itself, the provision of a definition in the explanatory material does not fall foul of the principles laid down in Cherkley. The Claimant accepts that the definition of "affordable housing" does not impermissibly cross the boundary from providing interpretative assistance to laying down impermissibly an additional policy requirement absent from the policy itself.
42. In my judgment there is no reason for treating the passage at the beginning of the last paragraph of the explanatory text dealing with "aggregation" any differently. The word "sites" is not defined in the policy and it is not restricted to an application site. Beyond that, it is to some extent a matter of planning judgment as to how the term is to be applied. At this point the explanatory text helps to elucidate what is meant by the language of the policy. It does not involve the imposition of a policy requirement absent from the policy itself.
43. By definition, unless the explanatory material of a local plan merely repeats what is already contained in the policy, which of course would be completely pointless, it will typically add provisions not contained in the policy. The supporting text is not limited to "reasoned justification"; it may include "description" and "explanation". "Elaboration" within the ambit of the "policy" of a local plan is permissible. The "affordable housing" definition provides an example of additional text which explains what is meant by language used in policy HOU13. This stands in stark context to Cherkley where the subject of need, let alone a requirement to demonstrate need, was not mentioned in the policy at all.
44. For all these reasons ground 1 of the challenge must be rejected.

Ground 2

45. Mr Crean QC submitted that this ground only arises if ground 1 is rejected. So the starting point is, as I have already determined, that the explanatory text dealing with aggregation of land or development proposals is not to be treated as legally irrelevant, but is to be taken into account in the interpretation, and indeed the application, of policy HOU13. It follows, as Mr Crean QC accepted, that a decision-maker is entitled to have regard to considerations of the kind which the Inspectors in the Brandlord and the present case took into account.
46. Against that background, Mr Crean QC nevertheless puts forward a fall-back argument. He submits that the phrases "will seek to negotiate" and "potential development" indicate that aggregation can only be considered "prospectively" and not "retrospectively". In other words, aggregation can be considered under HOU13 at the outset where the decision-maker is considering the first application for a residential planning permission on part of what might be considered to be a larger area of land, (ie. where no residential planning permission has already been granted on some other part of that larger area), but not where planning permission has already been granted for residential development (without a requirement for affordable housing) on one area of land and a subsequent application is made for permission to build dwellings on a second site which is judged to form part of a larger area comprising the first site. The former is the "prospective" scenario and the latter is said to be "retrospective" and an impermissible approach under the terms of the policy and its explanatory text.
47. The Claimant's argument is deeply unattractive and I have no hesitation in rejecting it. First, the language in the policy and in the explanatory text, read naturally, applies to both of the scenarios described by Mr Crean QC. It is not restricted in its effect to the wholly "prospective" scenario. Second, the Claimant's submission creates a legal distinction between the two scenarios which would simply depend upon the manner in which landowners chose to submit planning applications. It would be open to abuse. Third, it cuts across the purpose of policy HOU13. There is no sensible reason why aggregation should be allowed to be considered on a so-called "prospective" basis but never where a planning permission has already been granted on part of a larger area to which HOU13 could justifiably be applied. Mr Crean QC submitted that this approach was necessary so that policy HOU13 does not result in development proposals becoming unviable. But that is not an inevitable consequence if his interpretation is rejected. Indeed, he was constrained to accept that viability issues would be relevant considerations in any event if aggregation could be considered in the so-called "retrospective" scenario.
48. Mr Crean QC also suggested that his construction was necessary so as to avoid the sort of uncertainty for developers and others which the drawing up of local plan policies is meant to avoid (see for example Lord Reed JSC in Tesco at paragraphs 18 to 19). The issue raised by this argument is the extent to which it is possible for a developer or landowner to identify the extent of any wider area to which aggregation might apply. However, what Lord Reed JSC was referring to was an entirely different point, namely a planning authority altering the meaning of a policy from time to time according to what they would like it to mean, rather than treating that "meaning" as an objective issue of interpretation. But the issue we are dealing with here is concerned with the use of judgment in the application of policy. In that situation there is inevitably scope for difference of opinion. Fundamental principles of public law make it plain that we generally cannot insist on there being only one answer for a given set of circumstances.
49. Furthermore, what Mr Crean QC seeks to identify as a problem should not be exaggerated. We are talking about the potential identification of a larger area of land for the application of a threshold which is relatively small, 5 dwellings or 15 dwellings. Uncertainty can also be reduced or avoided by parties engaging with the local planning authority in pre-application discussions.
50. The "uncertainty" point raised by the Clamant is also unmeritorious because it could arise in any event in the "prospective" situation where ground 2 assumes that aggregation of land may properly be considered. It therefore does not provide any principled basis for distinguishing as a matter of law between the "prospective" and "retrospective" scenarios suggested by Mr Crean QC.
51. Given his primary submissions on the status of the explanatory text in the local plan, it was surprising to find Mr Crean QC relying on a Supplementary Planning Guidance produced by TBC in order to support his construction of the local plan. However, the text of the SPG does not support the restriction of aggregation under policy HOU13 to "prospective" situations. Read as a whole the document does not have that effect.
52. For all these reasons ground 2 must fail.

Conclusions

53. With regard to the application for permission to apply for judicial review, I accept that ground 1 just crosses the threshold of arguability. The Claimant accepts that ground 2 only arises if ground 1 fails. I consider that ground 2 is hopeless for the reasons set out above and therefore permission to apply in respect of that ground must be refused. The order on the substantive application is that the claim for statutory review is dismissed.