EXTRA DIVISION, INNER HOUSE, COURT OF SESSION
Lord Osborne Lord Kingarth Lord Eassie	[2009] CSIH 22   Appeal No. XA156/04 OPINION OF THE COURT delivered by LORD OSBORNE in reclaiming motion by HALLAM LAND MANAGEMENT LIMITED Appellants and Reclaimers; against THE SCOTTISH MINISTERS Respondents. _______

Act: J G Reid QC; Biggart Baillie

Alt: Miss R Crawford QC; Office of the Solicitor to the Scottish Executive

17 March 2009

The Background circumstances

[1] In this reclaiming motion, the reclaimers seek review of an interlocutor of the Lord Ordinary, dated 19 April 2007, in which he refused the reclaimers' appeal under section 29 of the Land Compensation (Scotland) Act 1963 against a decision of the respondents, dated and communicated to the reclaimers on 22 October 2004. That decision had been made on an appeal lodged by the reclaimers against the decision of East Dunbartonshire Council to issue a certificate of appropriate alternative development in respect of an area of land on the western edge of the village of Torrance, which certificate, issued by that Council on 26 April 2002, indicated that:

..."the only acceptable use of the land would be amenity space for informal recreation and nature conservation interests and planning permission would not have been granted for any other development."

The reasons given for the issue of the certificate in those terms were stated in it as follows:

"In view of national, strategic and local plan policy, and the consistent approach of the planning authority (supported by the Scottish Office/Executive at appeal), it is clear that continued use of this site as amenity space for informal recreation and nature conservation interests is the only appropriate use both immediately or at a future time."

[2] The land to which that certificate related, "the appeal site", is shown outlined on the plan referred to in the certificate, signed as relative thereto and of even date. The appeal site is an area of land in the ownership of the reclaimers, which extends to some 2.27 hectares. The site is bounded to the east by Torrance Primary School and to the south by a private housing development. To the west, the site is bounded by the Tower Burn and beyond that agricultural land, which is also in the ownership of the reclaimers. The burn marks the inner edge of the Green Belt. To the north, the site is bounded by a strip of land that is also in the ownership of the reclaimers, which separates the site from Maitland Drive, Torrance. The site is generally rectangular in shape and consists in a low lying area of ground that slopes gently from the north west to the south east. As at 14 August 2003, it was described by the reporter, Mr I. G. Lumsden, responsible for a Report of that date on a public hearing held on 8 April 2003 in relation to the appeal lodged by the reclaimers concerning the certificate of appropriate alternative development, "the Lumsden Report", as being:

..."uncultivated, overgrown with long grass and in parts ..... marshy. An unsurfaced path runs across the site in a south westerly direction broadly parallel to the Tower Burn. Although no formal public footpaths cross the site it is clear that the area is used by the public for informal recreation and the walking of dogs."

[3] The appeal site has a lengthy planning history. In an amendment to the County of Stirling Development Plan, the site was zoned in 1971 as open space on the Torrance Town Map. Henry Boot Limited, the parent company of the reclaimers, purchased the appeal site in 1973 as part of a larger acquisition of land in the area. In the late 1970s the site was offered to the relevant council for open space and leisure use, however, this offer was rejected. In 1988, the former Strathkelvin District Council promoted a compulsory purchase order for the land, in order to develop it as a local park. After an appeal against certificates of appropriate alternative development issued by that council for two separate plots of land, which included the appeal site, the then Secretary of State for Scotland issued certificates in respect of all the land that lay to the east of the Tower Burn. Those certificates covered a more extensive area than the present appeal site. Issued in 1990, they were for either residential or private leisure and recreation development on the land. The council's compulsory order was subsequently withdrawn. In 1992, a planning application was submitted for the erection of fifty four houses on a larger area of land which included the appeal site. That application was refused by Strathkelvin District Council and the subsequent appeal was dismissed in July 1994.

[4] In 1997, two separate applications were submitted for consent for residential development on land to the south of Maitland Drive. The first was for the development of seven house plots on the strip of land that fronts on to Maitland Drive. This application was refused by the Council and the subsequent appeal was dismissed in August 1999. In November 1999 the Council issued a refusal notice relating to the second application. The reclaimers did not appeal that refusal. However, on 16 February 2000 they served a purchase notice on the Council relating to the land covered by the second application just referred to. In May 2000, the Council intimated that it was not willing to comply with the purchase notice and the matter was then referred to the respondents for determination. On 22 March 2001, following a public hearing, the respondents confirmed the purchase notice. Following confirmation of the notice, the Council indicated that it was not prepared to adopt the decisions made in relation to certificates of appropriate alternative development in 1990 as the basis for the assessment of compensation.

[5] Subsequently on 27 February 2002, the reclaimers submitted a fresh application for a certificate of appropriate alternative development for the appeal site. That application proposed that the class of development which would be appropriate was residential development. On 26 April 2002, East Dunbartonshire Council issued the certificate to which we have already referred, stating that the only acceptable use of the land would be amenity open space use, which was a class of development other than that specified in the application for the certificate of appropriate alternative development. An appeal against the failure of the council to issue a certificate of appropriate alternative development for residential development was submitted on 7 May 2002. Since in April 2002 a further application for planning permission had been submitted for the erection of twenty five houses on the northern part of the appeal site, with the southern part, extending to some 1.45 hectares, being gifted to the council for use as a Nature Park, in order that parties could have the opportunity to try to resolve matters through the consideration of that application, that appeal was sisted. However, on 31 October 2002 the Council refused that application and the appeal was reactivated. In consequence, a public hearing was held on 8 April 2003. The reporter's conclusions are set out in paragraphs 45 and 46 of the Lumsden Report, which appear at page 48 of the appendix to the reclaiming motion. He concluded that residential use would represent an appropriate alternative form of development for a limited part of the appeal site. He considered that a certificate of appropriate alternative development ought therefore to be issued, subject to conditions restricting the area that could be developed and retaining a pedestrian access to the rest of the site. He considered that the conditions restricting the area to be developed were required to ensure that no development took place:

(a) outwith the raised area of made-up ground, which was the result of soil tipping operations in the past, that is to say that no development should take place on "green field" land; and

(b) on land which was below 39 metres AOD, to ensure that no houses were built on areas that were subject to flooding.

Provided that these conditions were imposed, the reporter considered that, on the relevant date, a limited residential development on the northern part of the site would not have conflicted with the policies of the development plan, suitably trimmed to exclude the proposal giving rise to the purchase notice. He noted that no evidence had been produced to suggest that there would be any constraint on such residential development. However, he found that residential development on the southern part of the site would involve land that

(i) had not previously been developed,

(ii) was liable to flood, and

(iii) was of value to nature conservation.

The reporter expressed the view that, even in the "no scheme world" of the certificate of appropriate alternative development, the development of this "green field" area would be contrary to the terms of the development plan and national planning guidance. Accordingly no residential development ought to be permitted on that part of the site. He made recommendations to the respondents in accordance with the conclusions which we have summarised.

[6] However, in a decision letter, dated 26 February 2004 the respondents intimated their decision to confirm the certificate of appropriate alternative development, as issued by East Dunbartonshire Council. Thereafter, the reclaimers lodged an appeal in the Court of Session against that decision. Subsequently, the respondents indicated that they intended to concede that appeal, solely on the basis that they had taken into account matters which they ought not to have taken into account, namely the provision of a Village Nature Park, in terms of Policy LR5 of the adopted East Dunbartonshire (Strathkelvin Area) Local Plan, and for that reason the respondents had exceeded their statutory powers. That decision of the respondents was accordingly quashed by this court by 4 August 2004. Thus the reclaimers' appeal against the decision of East Dunbartonshire Council with regard to the certificate of appropriate alternative development fell to be re-determined.

[7] Following that procedure, by a decision letter dated 22 October 2004, which is the subject of the present proceedings, the respondents rejected the reporter's recommendation to the effect that the certificate of appropriate alternative development should allow for residential development in respect of the northern part of the appeal site. They therefore decided to dismiss the reclaimers' appeal against the certificate of appropriate alternative development issued by East Dunbartonshire Council on 26 April 2002 in respect of that land. Their detailed reasons for adopting that course are set out in that decision letter which is to be found at page 16 and following pages of the reclaiming print. It was against that decision that the present application was made to this court. By an interlocutor dated 7 September 2005, the hearing on the reclaimer's appeal and answers was remitted to the Lord Ordinary to determine. As already narrated, the Lord Ordinary refused that appeal. Against his decision, the present reclaiming motion has been enrolled.

The grounds of appeal

[8] The appellant has tabled the following grounds of appeal against the interlocutor of the Lord Ordinary:

"1. [The Lord Ordinary] ought to have concluded that the Scottish Ministers failed to disregard the underlying requirement to devote the site to amenity open space for informal recreation and nature conservation which is substantially the same as or akin to the notion of a village nature park. The Scottish Ministers were not entitled to rely, as they and the Reporter did, on the underlying public purpose for which the site was purchased, namely for use as a village nature park. Use of land as public open space, for informal recreation and for nature conservation underlies the use of land as a village nature park. The Lord Ordinary and the Scottish Ministers erred in failing to conclude that the scheme underlying the acquisition, namely the preservation of the site for public open space, for informal recreation and nature conservation purposes, fell to be treated as having been cancelled at the relevant date (agreed to be 22 March 2001 - paragraph 6 of the Lord Ordinary's Opinion). The Scottish Ministers thus took into account irrelevant matters. The Lord Ordinary erred in failing to reach that conclusion. In doing so, the Scottish Ministers and the Lord Ordinary misconstrued section 25(3) of the Land Compensation (Scotland) Act 1963. This ground of appeal applies to both parts of the site [Lord Ordinary's Opinion paragraphs 27-30].

2. The Lord Ordinary and the Scottish Ministers failed to appreciate that for the purposes of issuing a CAAD, refusal of a positive certificate required to be justified by reference to material considerations independent of the Development Plan. They thus misconstrued section 25(7) of the 1963 Act. This ground of appeal relates to both parts of the site [Lord Ordinary's Opinion paragraphs 27-30].

3. The Lord Ordinary failed to give any reasons for rejecting the appellants' third Ground of Appeal (lack of housing need). He ought to have given effect to it. This Ground of Appeal applies to both parts of the site [Lord Ordinary's Opinion paragraph 31].

4. The Lord Ordinary failed to give any reasons for rejecting the appellants' sixth Ground of Appeal (risk of flooding to the southern part of the site). This Ground of Appeal relates to the southern part of the site, there being no such flooding risk at the northern part [Lord Ordinary's Opinion paragraph 31].

5. The Lord Ordinary failed to consider and give effect to the appellants' fourth Ground of Appeal (application of same reasoning to materially different parts of the site) (Reclaiming Print page 9). This Ground of Appeal applies to both parts of the site.

6. The Lord Ordinary failed to consider and give effect to the fifth Ground of Appeal (the alternative branch only [the infill site argument] was advanced) (Reclaiming Print page 10). This Ground of Appeal applies to the northern part of the site.

7. The Lord Ordinary erred in law in concluding that there was a difference in substance between the decision letter dated 28 February 2004 and the Decision Letter dated 22 October 2004. The reasoning in each letter was substantially the same. In particular, in the Decision Letter dated 28 February 2004, the Scottish Ministers referred to and relied upon Policy LR5 to justify the need to protect the whole of the land to the south of Maitland Drive, Torrance for amenity purposes through the provision of a Village Nature Park (paragraphs 15 and 20). In the equivalent paragraphs in the Decision Letter dated 22 October 2004 (paragraphs 21 and 26), the Scottish Ministers simply omit the reference to Policy LR5 and the Village Nature Park. The underlying reasoning and justification for a negative certificate remains the same, namely the need to protect the land for amenity purposes, namely public open space for informal recreation and nature conservation. This is the underlying proposal which ought to have been treated as cancelled. This Ground of Appeal applies to both parts of the site [Lord Ordinary's opinion paragraph 31]."

The submissions of the reclaimers

[9] Senior counsel outlined the planning background described at the outset of this Opinion. The terms of the certificate of appropriate alternative development, granted by East Dunbartonshire Council, dated 26 April 2002, which could be described as a negative certificate, were important; it averred that the only acceptable use of the land would be as "amenity space for informal recreation and nature conservation interests." There had, of course, been an earlier conclusion that the land in question was incapable of reasonably beneficial use, as appeared from the decision letter of the Scottish Ministers, dated 22 March 2001, found at pages 29 and 30 of the Appendix. In consequence, the purchase notice, dated 16 February 2000, had been confirmed by them. As was recognised in that decision letter by the Scottish Ministers, the decision which had prompted the purchase notice was that of the Council, on 15 November 1999, to refuse a consent for the planning application there referred to. That decision letter had been issued following the hearing conducted under section 265 of the Town and Country Planning (Scotland) Act 1997 on 17 November 2000 by Mr R. W. Jackson, as the reporter. He found in paragraph 2.2 of his report, dated 24 January 2001, that the Council had refused the planning application "for reasons primarily based upon Local Plan policy designating the site as a Village Nature Park, loss of open space, risk of flooding and precedent". Senior counsel also drew our attention to paragraphs 3.2, 4.6 and 4.8 of that report. It was that material that had been the basis for the acquisition of the land in question, following the procedure set forth in section 88 of the 1997 Act. In terms of section 94 of that Act, where a purchase notice had been confirmed, the relevant planning authority was deemed to have been authorised to acquire the interest of the owner compulsorily in accordance with the relevant provisions, and to have served a notice to treat in respect of it, on such date as might be directed. In effect, therefore, the acquisition of the land had been deemed to have been effected by compulsory acquisition. The effect of that was to make applicable to this notional compulsory acquisition the compensation provisions applicable to compulsory acquisition. It was in that way that the opportunity for the making of an application for a certificate of appropriate alternative development had arisen. Thus the provisions of Part VIII of the 1997 Act had application. The purpose for which the deemed compulsory acquisition took place could be discerned from the terms of para 4.6 of Mr Jackson's report dated 24 January 2001.

[10] Senior counsel went on to explain the statutory background to the certification of appropriate alternative development by planning authorities. Section 25 of the Land Compensation (Scotland) Act 1963 was of importance. The effect of those provisions had been expiscated by judicial pronouncement particularly by Lord Hope of Craighead in Fletcher Estates (Harlescott) Ltd v Secretary of State for the Environment [2000] 2 AC 307, at page 322 to 323. The effect of section 25 of the 1963 Act was that the assumption which the local planning authority had to make in relation to a certificate of appropriate alternative development, as at the relevant date, was that "the scheme" for which the land was proposed to be acquired, together with the underlying proposal which might appear in any of the planning documents, had, on that date, been cancelled. No assumption had to be made as to what might or might not have happened in the past. On being pressed as to what was the "scheme" for which the land was deemed to be proposed to be acquired in the present case, senior counsel accepted that, in reality, there was no "scheme", but the court had to proceed on the basis that the "scheme" was the proposal in the Local Plan that the site should be a Village Nature Park, in accordance with Policy LR5. The operation of section 25(7) of the 1963 Act had been explained in Bell v The Lord Advocate 1968 S.C. 14. Thus if a local authority was to treat development as development for which planning permission would have been refused, there had to be independent and concrete grounds which were not and could not be said to be involved, or implied, in the provisions of the development plan. Reference was made to the Opinion of Lord Cameron at page 25 of that case.

[11] Senior counsel then turned to deal specifically with the Grounds of Appeal. He said that Grounds 1 and 2 would be taken together. The submission was that the provisions of the development plan, which identified the Village Nature Park scheme for the site, which underlay the public purpose with which the reclaimers' application for a certificate of appropriate alternative development was not in accord, permeated and formed the foundation of the reasoning process of the respondents in relation to the whole site and also the reasoning process of the reporter, Mr I G Lumsden, in relation to the southern part of the site. If that was correct, Grounds of Appeal 1 and 2 were well founded. The first decision of the respondents had been acknowledged to have been bad, because of its reliance upon the provisions of the development plan. It was contended that there was no difference in substance between the two decisions. It was instructive to make a comparison between the terms of paragraph 15 of the old decision in the appendix at page 52 and paragraph 21 of the decision under scrutiny, at page 19 of the reclaiming print. These paragraphs were virtually identical. In the former paragraph 15, there were two sentences which had been omitted from the latter paragraph 21. Reference was also made to paragraph 20 of the old decision at page 53 of the appendix and paragraph 26 of the decision in question at page 20 of the reclaiming print. There was no difference in substance between these decisions. The respondents were using the public purpose of amenity as a justification for the issue of a negative certificate, but that purpose derived entirely from the provisions of the development plan. Paragraph 13 of the respondents' decision, at page 18 of the reclaiming print showed that the decision relating to the southern side of the site was based on a conflict between the purpose for which the certificate had been sought by the reclaimers and the development plan. The rest of the decision under scrutiny amounted to a disagreement with the reporter regarding the northern part of the site; he had recommended a positive certificate relating to that part, with which the respondents had disagreed, as appeared from paragraph 27 of their decision at page 20 of the reclaiming print. There were other paragraphs of the decision applicable to the southern part of the site which showed that the reasoning in the certificate under scrutiny relied heavily on the underlying public purpose of retention of the land as amenity land for recreation and conservation. Reference was made to paragraphs 16-18, 20 and 21. In that connection reliance had been placed by the respondents on the Policy EP14 of the Local Plan, found at page 57 of the appendix. Senior counsel made several points regarding this reliance. First, it applied where no specific development policies or proposals applied. Here there was a proposal which applied specifically to the site, Policy LR5 and the associated Table which referred specifically to Maitland Drive and the provision of a Village Nature Park. Thus the Policy EP14, on its own terms, could not apply and be invoked in relation to the site. The statutory hypothesis created by section 25(7) of the 1963 Act could not alter or affect the fact of the non-application of Policy EP14 to the site. Secondly, even if Policy EP14 did apply to the site, it merely reflected the underlying purpose for the use of the land, which purpose fell to be ignored. Thirdly, Policy EP14 did not provide justification for the refusal of a positive certificate, which was independent of the development plan.

[12] Senior counsel went on to draw attention to paragraph 24 of the decision under scrutiny, where the respondents relied on a general housing policy. He also drew our attention to paragraph 25, where the respondents relied on the function of the site as a green wedge. That appeared to relate to both parts of the site. However, that was associated with the underlying public purpose of conserving the land for public amenity purposes. Because of section 25(7) of the 1963 Act that policy fell to be ignored. The underlying public need to devote the site to fulfil the need for conservation, etc. fell to be ignored. If it were not to be ignored, there would always be a negative certificate issued, which would undermine the whole purpose of section 25(7) of the 1963 Act. For the land in question to become a space for public use it would have to be acquired by an authority possessing compulsory purchase powers, in the absence of agreement on the part of the owner. Assistance could be got as regards what had to be ignored from an examination of paragraph 3.2 of the report from Mr R. W. Jackson, at page 23 of the appendix. If that approach were taken the question might be asked what might be left to obstruct the grant of a positive certificate of appropriate alternative development. Mr I G Lumsden in his report at paragraph 24 on page 42 of the appendix had approached the matter by asking whether a planning application for residential development on the site would have been granted as at the relevant date. He had then asked the question posed in paragraph 27 of his report at page 43, but that was an erroneous approach. The correct approach would be different; it would be to ask whether, given the scheme to make the site a Village Nature Park and the underlying public purpose of conservation of an open space for recreational purposes were all cancelled, would residential development be appropriate. That approach was in conformity with the authorities to which senior counsel then referred.

[13] The first of these was Grampian Regional Council v Secretary of State for Scotland 1984 S. C. (H. L). 1. The background to the case was that certificates of appropriate alternative development in positive terms had been granted. Thereafter, the case came before the House of Lords on an appeal by the councils involved. The speech of Lord Bridge of Harwich was instructive. At page 30, his Lordship explained the operation of section 25(7) of the 1963 Act. A number of points emerged from this case. First, the essential purpose of the certificate procedure had to be borne in mind at all times. That was to ensure that some public purpose was not to be achieved at the expense of a private landowner. Secondly, both the Court of Session and the House of Lords rejected the argument that the underlying requirement to devote land to fulfil a public purpose fell to be taken into account. Thirdly, a negative certificate had to be supported on planning grounds that were independent of the scheme in implement of which the compulsory purchase powers were being used. Reference was also made to the Opinions of Lord Dunpark at page 14 and Lord McDonald at page 21.

[14] Fletcher Estates (Harlescott) Ltd v Secretary of State for the Environment was also of assistance. It was evident from this case that the House of Lords affirmed the decision in Grampian Regional Council v Secretary of State for Scotland. It was said that the assumption which the local planning authority required to make, as at the relevant date, was that the scheme for which the land was proposed to be acquired, together with the underlying proposal which might appear in any of the planning documents, must be assumed on that date to have been cancelled. The question which the local planning authority had to answer was capable of being determined, on the assumption that the proposal had been cancelled on the relevant date, in the light of the circumstances existing at that date and by the application of ordinary planning principles. The question was whether reasons existed for the refusal of planning permission which were quite independent of any scheme for the acquisition of the land for use for the purposes of the proposed by-pass.

[15] The significance of Fletcher Estates (Harlescott) Ltd v Secretary of State for the Environment in the present context arose from the fact that the principles explained there had been held to be applicable in Scots law in South Lanarkshire Council v The Lord Advocate 2002 S.C.88. Attention was drawn particularly to paragraphs 6, 7, 8, 12-14, 19-22, 26, 29 and 30.

[16] Senior counsel next reverted to Bell v The Lord Advocate, particularly the observations of Lord Walker at pages 20-21, Lord Cameron at pages 23-25 and Lord Milligan at pages 25-26. The case made clear that what had to be identified were

..."independent and concrete grounds which are not and cannot be said to be involved or implied in the provisions of the plan in respect of development of the land in question."

[17] Senior counsel went on to draw our attention to Scunthorpe Borough Council v Secretary of State for the Environment 1997 J.P.L 653. It was explained that that case constituted an example of the operation of the principles expressed in the earlier cases referred to, in relation to open space land. Senior counsel also referred to Fox &c v Secretary of State for the Environment (1991) 62 P. and C.R. 459 as an illustration of the application of sections 17(4) and (7) of the Land Compensation Act 1961, the English equivalents of section 25(4) and (7) of the 1963 Act.

[18] Senior counsel observed that, in the context of this case, where the issue of a certificate of appropriate alternative development did not arise out of an actual proposal for compulsory purchase of the site in question by a statutory authority, but rather from the circumstance that, first, planning permission had been refused and, second, that the reclaimers had established that the land had become incapable of reasonably beneficial use in its existing state, all in terms of section 88(1) and (3) of the 1997 Act, the court was dealing with a situation in which, the purchase notice having been confirmed, East Dunbartonshire Council were deemed to be authorised to acquire the interest of the reclaimers in the land, "in accordance with the relevant provisions", in terms of section 94 of the 1997 Act. The "relevant provisions" were, in the context, the provisions of Part VIII of that Act. Thus the issue arose of what was the "scheme" that had to be ignored, there being no actual "scheme" which could be ignored. Senior counsel explained that he had been unable to find any specific authority relating to this issue. He submitted that, in the context described, the "scheme" had to be the establishment of the Village Nature Park. The underlying purpose of that "scheme" had to be the use of the land for recreational and conservation purposes. He indicated that he would also address the position, if it were to be concluded that there was no "scheme."

[19] In elaborating this submission, senior counsel drew attention to the fact that, on refusing to grant planning permission for the land in question, the planning authority had given certain reasons. These had already been noted and were recorded in paragraph 2.2 of the report of Mr R. W. Jackson, following the hearing conducted in relation to the purchase notice, dated 24 January 2001. In paragraph 2.2 it was narrated that the council had refused the application "for reasons primarily based on local plan policy designating the site as a Village Nature Park, loss of open space, risk of flooding and precedent." The provisions of section 189(1)(a) and (b) of the 1997 Act were also pertinent. Their effect, in the present context was that the underlying purpose of the deemed acquisition was what it was necessary to achieve "in the interests of the proper planning" of the area. It was evident that the establishment of the Village Nature Park represented the planning authority's view of the "proper planning" of the area.

[20] However, it was submitted that it was necessary to identify the underlying purpose of the deemed acquisition. The deeming effect of section 94(1) of the 1997 Act, in association with section 30(2)(b) of the 1963 Act, meant that the situation was comparable with one in which compulsory purchase had actually been promoted for the implementation of a particular scheme.

[21] South Lanarkshire Council v Lord Advocate 2002 S.C. 88 was a case comparable to this one, as was evident from the circumstances outlined in paragraph 1 of the opinion of the court; there had been a purchase notice served on the relevant council by the land owner. It was quite apparent from paragraph 14 of the opinion of the court that the guidance to be found in Fletcher Estates (Harlescott) Ltd v Secretary of State for the Environment had to be applied to such a situation.

[22] Senior counsel contended that, even if he were wrong about the immediately preceding submission, and if there was no assumed scheme which could be identified, it was still necessary to have regard to and implement the provisions of section 25(7) of the 1963 Act. That subsection made reference to "the provisions of the development plan relating thereto". That meant that, in the certificate of appropriate alternative development, the provisions of the development plan could not be relied upon in issuing a negative certificate. That had been appreciated in the case of Bell v The Lord Advocate. In considering the expression "development plan", it was necessary to look at substance rather than form. However the decision of the respondents under consideration was permeated with references to the development plan. It was quite plain that they had failed to act in accordance with the provisions of section 25(7) of the 1963 Act. Turning to the Opinion of the Lord Ordinary, the core of his decision was to be found in paragraph [30] at page 23 of the Reclaiming Print. The Lord Ordinary had not considered the authorities cited to him in detail; what he had said in this paragraph was erroneous. He had not given proper consideration to the terms of section 25(7) of the 1963 Act.

[23] Senior counsel then moved on to support the reclaimers' Ground of Appeal 3. In this connection it was appropriate to consider the terms of paragraphs 21, 24, 25 and 26 of the respondents' decision letter, dated 22 October 2004. It was evident in that letter that reliance was being placed upon the green wedge policy enshrined in Policy EP14. In this connection Policy EP14.4 was important. If one looked at the relevant parts of the decision letter, it was evident that the respondents' reasoning was not independent of the development plan policies; it related specifically to the green wedge concept just referred to. In any event, the existence or otherwise of housing need was not directly relevant. In this connection reliance was placed upon Scottish Planning Law and Procedure (2nd Ed), Rowan-Robinson, paragraph 8.106.

[24] Senior counsel then turned to support Ground of Appeal 4 for the reclaimers. He said that the point raised in this Ground of Appeal was similar to that raised in Ground of Appeal 3. In the decision letter dated 22 October 2004, paragraph 13, the respondents had accepted the reporter's reasoning and conclusion regarding the southern part of the appeal site. That reflected what had been said in paragraph 31 of the Lumsden Report. Mr I G Lumsden had been concerned about the risk of flooding of the southern part of the site. In paragraph 36, he had drawn attention to Policy DC9 of the local plan, which dealt with the issue of flooding. While the flood risk could have been substantially reduced by infilling that part of the site, thus raising its level, he had rejected that possibility, upon the basis that it would create problems elsewhere. In paragraph 37, he drew attention to the deleterious effect that such works might have. In paragraph 38 he therefore made a distinction between the two parts of the site. Reference was also made to paragraph 38-40 of the report. Senior counsel submitted that in this part of the report, the flooding consideration had been inextricably linked with the underlying purpose which had to be treated as cancelled, that is to say the creation of an area for among other things conservation. In addition, the reporter's language suggested that he had had Policy EP14 in mind. In all these circumstances, it was evident that the reporter himself had failed to keep in mind the provisions of section 25(7) of the 1963 Act.

[25] Senior counsel next dealt with the reclaimers' Ground of Appeal 5. This was concerned with the categorisation by the respondents of the northern part of the site as part of a green wedge, as opposed to a brown field site. While the Lord Ordinary narrated the appellants' submissions relating to this, he had failed to deal with the arguments advanced to him. In paragraphs 20 and 22 of their decision, the respondents had attempted to categorise the appeal site as a green wedge. This was erroneous having regard to the definition of brown field sites in both the structure plan and the local plan. It was quite plain that the northern part of the site was an infill site and hence a brown field site. The respondents were not entitled to take the view that they did. In any event, even upon the assumption that they were entitled to view the whole appeal site as a green wedge, the attribution of weight to that in their decision was a reversion to a consideration of an illegitimate matter, in that it represented reliance upon Policy EP14 of the local plan.

[26] Senior counsel went on to make submissions relating to Ground of Appeal 6, which raised issues related to those considered. The respondents had erred in their categorisation of the northern part of the site. Reference was made to paragraphs 19 and 20 of their decision letter dated 22 October 2004. In addition to the error of categorisation, they had erred in concluding that the site "would therefore appear to have active and beneficial use as an informal recreation area". That statement betrayed a fundamental misunderstanding as to what was meant by beneficial use in the legislation. It was a reversion to the response notice, dated 8 May 2000, issued by the local authority, following upon the reclaimers' purchase notice. The use of the site for informal recreation was not "active and beneficial use". The fact of the matter was that the site was unoccupied; it lay vacant; it followed that it could not therefore be in active use for the benefit of the owner, which was the criterion. Vacant land was inherently unlikely to be in active or beneficial use. Beneficial use could not refer to use by persons who were, in effect, trespassers. The respondents ought to have concluded that the northern part of the appeal site was an infill site. In respect that they had not done so, they had erred in law. In connection with this submission senior counsel drew our attention to Adams & Wade Ltd v Minister of Housing and Local Government (1967) 18 P and C.R 60. That case demonstrated that the expression "beneficial use" in the legislation was a reference to a use which could benefit the owner, or a prospective owner, of the land; the fact that the land in its existing state conferred some benefit or value on the public at large was not beneficial use for this purpose. The respondents' decision in this respect was, first, erroneous in law, and, second, inconsistent with the earlier decision to confirm the purchase notice.

[27] Finally senior counsel moved on to consider Ground of Appeal 7. This was essentially concerned with the terms of the decision letter dated 22 October 2004 in comparison with those of the decision letter, dated 28 February 2004, which had been quashed by the court in earlier proceedings. He submitted that the reasoning in each letter was substantially the same. Apart from certain omissions in the latter letter, the text of the letters was identical. This point was not capable of elaboration.

Submissions of the Respondents

[30] Senior counsel for the respondents moved the court to refuse the appeal. She said that, looking at Grounds of Appeal 1 and 2, one of the main questions was whether the respondents had had regard to relevant factors in confirming the certificate of appropriate alternative development under section 25(4) of the 1963 Act, in particular, whether the respondents had been entitled to have regard to and found upon the development plan policies identified in the Lumsden Report, incorporated in the decision letter. In this connection she referred to paragraphs 29-33 of that report. The fundamental issue was what was the extent of matters that had to be left out of account by the respondents in reaching their decision. This was the question focussed by the Lord Ordinary in paragraph [25] of his opinion. A further question that arose, if the court were to hold that the respondents were not entitled to found on development plan policies, was whether they had based their decision on other relevant considerations.

[31] Senior counsel went on to draw attention to certain preliminary matters. First, she did not challenge what was said in paragraph 28 of the Lumsden Report concerning the planning background. Second, as regards the site itself, a plan of it was to be found at page 71 of the appendix. The northern part of the site could not be taken to be delimited by the blue triangle on that plan. Rather, the two parts of the site had to be seen as defined in the way adopted by Mr Lumsden in paragraph 47 of his report. Third, the respondents' decision letter under consideration should be read as a whole; it should not be construed as if it were a conveyancing document, or a statute. Fourth, the respondents, it was submitted, were entitled to apply their own judgement to the findings in fact made by the reporter. They might disagree, as a matter of judgement, with the reporter's characterisation of the northern part of the appeal site, provided that they did not, in so doing, err in law. Mr I. G. Lumsden had concluded that the northern part of the appeal site was akin to a brown field site, as appeared from paragraph 29 of his report. That had led to his assessment that development plan policies and other material considerations, including national planning policy guidelines, did not justify the refusal of the certificate sought, in respect of the northern part of the appeal site. However, the position would have been different if the respondents had been entitled to conclude that the northern part of the appeal site was a part of a green wedge. Fifth, it was important to recall the purpose of a certificate of appropriate alternative development, explained by Lord Dunpark and Lord Bridge of Harwich in Grampian Regional Council v Secretary of State for Scotland, particularly at pages 29-31. The purpose of the certificate was the provision of a basis for a determination of the development value, if any, of the land, to be taken into account in assessing compensation for its compulsory purchase for some public purpose or purposes. In the present case, there was plainly a question regarding "the scheme" which might require to be ignored. Senior counsel contended that the "scheme" was the compulsory acquisition itself. The underlying planning purpose of the "scheme" had to be ignored. Under section 25 of the 1963 Act, the compulsory acquisition itself had to be ignored. The extent of any other disregards depended on identifying what public purposes justified the compulsory acquisition. The key to an understanding of the disregards was the identification of the public purpose justifying acquisition.

[32] Senior counsel then proceeded to advance her main propositions. The first was that, on account of the terms of section 25(4) of the 1963 Act, the respondents were required to assume that the acquisition of the site by the local planning authority, together with any underlying proposal relative to the site, which served a public purpose, had been "cancelled". The cancellation was in relation to the "scheme" and any underlying public purpose justifying it. That was not to say that it was to be assumed that the "scheme" had never existed. Senior counsel did not accept the submission of the reclaimers that the "scheme" was the proposal in the local plan for a Village Nature Park. The respondents were not entitled to rewrite history at the relevant date, 22 March 2001, the date of the purchase notice. That was what the reclaimers were inviting the court to do, that is to say, proceed upon the basis that there had never been a "scheme" for the land at all and that the underlying purpose had never existed. The reclaimers had never asked themselves the question posed by Lord Hope of Craighead in Fletcher Estates (Harlescott) Ltd v Secretary of State for the Environment at page 324.

[33] Second, the respondents required to determine the question raised by section 25(4) of the 1963 Act in the light of circumstances existing at the relevant date and by the application of ordinary planning principles, which would include having regard to the development plan and other material considerations. Third, having regard to the provisions of section 25(7) of the Act, if there were development plan policies relating to the land in question and those policies reflected the underlying planning need justifying acquisition, those policies could not be sole ground to justify a refusal of a positive certificate. In particular, the respondents could not found a refusal of a positive certificate on development plan policies which were specific or particular to the land to be acquired. If there were no development plan policies reflecting the underlying public purpose justifying acquisition, any other development plan policies could be seen as embraced within ordinary planning principles which could properly be taken into account and founded upon.

[34] It was necessary to consider the circumstances of the acquisition of the land in question. Section 30(2)(b) of the 1963 Act and the purchase notice procedure, as set out in section 88 of the 1997 Act, and the deeming provisions of section 94 of that Act, amounted to the "scheme" for acquisition that had to be ignored by the respondents. In this connection senior counsel relied on Grampian Regional Council v Secretary of State for Scotland, particularly the observations of Lord Bridge of Harwich at pages 29 and 30. She also referred to the provisions of section 94, 99, 189 and 193 of the 1997 Act. Senior counsel said that her submission was that, in the particular circumstances of this case, there was in fact no underlying public purpose in the acquisition. If there was, it was the Policy LR5 which had not been taken into account by the respondents. In these circumstances, the question which had to be asked by the respondents was, if the Village Nature Park were to be established on the land, would residential development be permitted on that land. The answer to that question was plainly in the negative. In the event that the Policy LR5 did reflect the underlying public purpose justifying the acquisition and it fell to be left out of account, the Policy EP14,which did not relate specifically to the appeal site and which potentially applied to areas where no specific development policies applied, would become of relevance as a justification for refusal of a positive certificate.. In connection with this part of her argument senior counsel referred to South Lanarkshire Council v The Lord Advocate at pages 92 and 95-99; Fox v Secretary of State for the Environment at pages 477-478; Scunthorpe Borough Council v The Secretary of State for the Environment; and Grampian Regional Council v The Secretary of State for Scotland at page 21. Against this background, the respondents were entitled to have regard to development plan policies embodying general planning principles, for example such policies relating to flooding, the green belt, natural heritage, the value of recreational facilities, etc. In this regard senior counsel relied on National Planning Policy Planning Guideline 11 relating to sport, physical recreation and open space.

[35] In applying section 25(7) of the 1963 Act it was necessary to look carefully at the language of the section. It contained the words "otherwise than in accordance with the provisions of the development plan relating thereto". That meant that the policy referred to in that part of the subsection had to be a policy that related specifically to the land under consideration; in this connection she referred to the observations of Lord Bridge of Harwich in Grampian Regional Council v Secretary of State for Scotland at page 30 and the observations of Lord Walker in Bell v The Lord Advocate at pages 19 and 20.

[36] Summarising her position, senior counsel emphasised that, in the present context, there was no underlying proposal at all to be ignored. If that submission were rejected, then Policy LR5 would amount to such a proposal, which had to be treated as cancelled. It had, in fact, been disregarded in the decision under consideration. The wider purposes contended for by the reclaimers did not represent the proposal for development and did not require to be disregarded. Those wider purposes could properly be considered under the heading of "ordinary planning principles"; they were general planning considerations. If those purposes were not to be taken into account, the court would fall into the error of the appellants in Fletcher Estates (Harlescott) Ltd v Secretary of State for the Environment; history would be rewritten. Support for this approach was available in the judgments in Bell v Lord Advocate at pages 21, 23 and 25-26. The respondents' submission was that a refusal of a positive certificate of appropriate alternative development could be based on development plan general policies, since such policies did not directly relate to the land in question. The policies to which the respondents had had regard were not policies relating specifically to the land in question. Accordingly it was open to them to apply them as part of what were described as ordinary planning principles and to carry out an assessment on the basis of them and other material considerations. The certificate issued had been assessed against National Planning Policy Guidelines, etc. The respondents had not taken account of, far less had they founded upon, the local plan Policy LR5.

[37] It was apparent that the reclaimers' challenge to the respondents' decision related, in part, to the treatment of the northern part of the appeal site as part of a green wedge, but there was no challenge to the categorisation of the southern part of the appeal site in that way. In this connection attention was drawn to paragraph 29 of the Lumsden Report The policies mentioned in that paragraph were relevant to green field sites everywhere.

[38] The reporter, Mr I. G. Lumsden, had carefully considered the issue of flood risk in relation to the southern part of the appeal site. The structure plan policy STRAT X referred to in paragraph 31 of the report, was relevant as was Policy DC9, which also related to the issue of flooding. In that connection reference was made to paragraphs 36 and 37 of the Lumsden Report. There was no linkage between these matters and any "scheme" which might be required to be ignored. The issue of flooding was relevant to the possibility of building houses on the southern part of the appeal site. National Planning Policy Guideline 7 was also a material consideration; it was dealt with in paragraph 40 of the same report. Likewise, there were local plan policies which related to housing development, but not specifically to the appeal site. These were detailed in paragraph 32 of the report. In paragraphs 33-35, the reporter had considered other local plan policies concerned with nature conservation and related matters.

[39] Senior counsel went on to consider the terms of the decision of the respondents dated 22 October 2004. As regards the southern part of the appeal site, the respondents had accepted the reasoning and conclusion of the reporter, as appeared from paragraph 13 of the decision letter. However, they had disagreed with his conclusions relating to the northern part, as appeared from paragraph 16 of that letter. The reporter had concluded that the northern part had characteristics more akin to a brown field site than green field land, a view with which the respondents disagreed. The definitions of the relevant terms were to be found in paragraph 19 of the decision letter. It had been open to the respondents to make the judgment that the whole appeal site area constituted a green wedge, in terms of the Policy EP14. A flaw in the reclaimers' argument had been that they had sought to extend the statutory disregard too far. The respondents had relied, not only upon development plan policies which were not specific to the site, but also had relied on National Planning Policy Guidelines, as material considerations, as appeared from paragraphs 39 to 41 and 46 of the Lumsden Report. Thus the respondents had not contravened the provisions of section 25(7) of the 1963 Act. That concluded the respondents' submissions on the Grounds of Appeal 1 and 2.

[40] Turning to the other Grounds of Appeal, senior counsel considered that she had dealt with Ground 3 and 4 in the course of the submission she had made. As regards Ground of Appeal 5, it was submitted that there was indeed no material difference between the two parts of the appeal site, despite the approach which the reporter had taken to the matter. It was a matter of planning judgment as to whether the appeal site should be categorised as a green wedge. The view expressed in paragraph 20 of the respondents' decision letter of 22 October 2004 was supportable. The use of the expression "beneficial use" in that paragraph should not be interpreted in the manner set forth in Adams & Wade Ltd v Minister of Housing and Local Government. In all the circumstances the appeal should be refused.

The decision

[41] It will be evident from our narrative of the submissions made to us that the statutory provisions applicable to the certification of appropriate alternative development were the principal focus of attention. These are, of course, to be found in section 25 of the 1963 Act. It is appropriate therefore to set out certain parts of that section, the terms of which must be considered in relation to the present dispute. Section 25(1) provides:

"(1) Where an interest in land is proposed to be acquired by an authority possessing compulsory purchase powers, either of the parties directly concerned may, subject to subsection (2) of this section, apply to the planning authority for a certificate under this section."

Subsection (2) does not give rise to any issue in the context of this case. However, subsection (3), which is of importance, is in the following terms:

"(3) An application for a certificate under this section -

(a) shall state whether or not there are, in the applicant's opinion, any classes of development which, either immediately or at a future time, would be appropriate for the land in question if it were not proposed to be acquired by any authority possessing compulsory purchase powers and, if so, shall specify the classes of development and the times at which they would be so appropriate;

(b) shall state the applicant's grounds for holding that opinion; and

(c) shall be accompanied by a statement specifying the date on which a copy of the application has been or will be served on the other party concerned."

Subsection(4) provides:

"(4) Where an application is made to the planning authority for a certificate under this section in respect of an interest in land, the planning authority shall, not earlier than twenty-one days after the date specified in the statement mentioned in subsection (3)(c) of this section, issue to the applicant a certificate stating that, in the opinion of the planning authority in respect of the land in question, either -

(a) planning permission would have been granted for development for one or more classes specified in the certificate (whether specified in the application or not) and for any development for which the land is to be acquired, but would not have been granted for any other development; or

(b) planning permission would have been granted for any development for which the land is to be acquired, but would not have been granted for any other development."

Subsection (7) of the section is also important. It provides :

"(7) In determining, for the purposes of the issue of a certificate under this section, whether planning permission for any particular class of development would have been granted in respect of any land, the planning authority shall not treat development of that class as development for which planning permission would have been refused by reason only that it would have involved development of the land in question (or of that land together with land) otherwise than in accordance with the provisions of the development plan relating thereto."

[42] We would emphasise that the provisions just quoted contain two subsections which bear directly upon the nature of the task which a planning authority requires to undertake when an application for a certificate under section 25 has been made to them. In the first place, subsection (3) contains the words "if it were not proposed to be acquired by any authority possessing compulsory purchase powers". Subsection (3), of course, relates to the requirements of an application for a certificate. The words just quoted, in association with the provisions of subsection (4), make it necessary for the planning authority, in dealing with an application under section 25, to enter what was described by Lord President Rodger, as he then was, in South Lanarkshire Council v Lord Advocate, in paragraph [8], as "the realm of the counterfactual." The focus of the planning authority's consideration must be the appropriateness of the land in question for classes of development, in a situation in which, contrary to the facts, the land was not "proposed to be acquired by any authority possessing compulsory purchase powers".

[43] In the second place, the provisions of subsection (7) themselves, independently of the earlier provisions quoted, create a further constraint upon the approach of the relevant planning authority. That authority is required not to treat development of any particular class

"as development for which planning permission would have been refused by reason only that it would have involved development of the land in question (or of that land together with other land) otherwise in accordance with the provisions of the development plan relating thereto."

Thus, if the relevant planning authority is minded to issue what can be described as a negative certificate in terms of subsection (4)(b), they can do so only if they can identify and found upon planning considerations justifying the refusal of classes of development other than that for which the land is to be acquired which are independent of the provisions of the development plan relating to that land.

[44] The approach just described, which we see as being required by the provisions of section 25 of the 1963 Act, in our opinion, is supported by several authorities in which those statutory provisions, or their English equivalents, were considered. The first of these is Bell v The Lord Advocate. It was concerned particularly with the application of section 25(7) of the 1963 Act. The case related to land zoned in the development plan involved for open space use, in respect of which the owner sought a certificate of appropriate alternative development, specifying in the application industrial, commercial or residential purposes as classes of development appropriate for the land, if it had not been compulsorily acquired. At page 23 of the report Lord Cameron provides an interpretation of section 25(7) of the 1963 Act. There he said:

"In the first place section 25(7) relates primarily to the action of the initially certifying authority, i.e. the local planning authority. It is therefore in the first place an instruction to the authority which itself prepared the plan. In the next place, its provisions can come into play only when a certificate of appropriate alternative development is sought and where that development would contravene the provisions of the plan relating to the land. Otherwise there is no need for a certificate, as the rights of parties are safeguarded by the assumptions contained in section 24 of the Act. ...... In my opinion the meaning of section 25(7) is that the local planning authority is directed to ignore as a ground for treating a proposed appropriate alternative development as one for which planning permission would have been refused - a permission which would necessarily involve a change of use of the land - the mere fact that such a change of use would be involved, and consequently a development of the land otherwise than in accordance with the provisions of the development plan. ..... The words 'relating thereto' are in my opinion referable to and qualify the antecedent 'provisions'. The provisions relate to the land in question or to that land together with other land, but it is necessarily and always in relation to the land in question, and the provisions of the development plan must therefore be provisions which define the type of development which the plan prescribes for this particular land - or that land in its relation to other land for which the plan makes the same development provisions."

His Lordship then proceeded to consider the particular circumstances of that case and concluded that the actions of the Secretary State had not fallen foul of section 25(7). He said at page 25 that

"...the Secretary of State has gone much further than to look solely at the conflict between the developments for which a certificate was sought and the mere terms of the development plan relative to the site owned by the appellant, and has based his decision on independent and concrete grounds which are not and cannot be said to be involved or implied in the provisions of the plan in respect of development of the land in question."

In the same case, at pages 25 and 26, Lord Milligan stated:

"...I am inclined to the view that a local planning authority's decision (or that of the Secretary of State) would not be open to challenge even if the reasons given for such a decision were exactly the same as the reasons contained in a development plan, provided that it was made clear that the authority had considered the matter independently of the plan and was not merely relying on the existence of the plan. The mere fact that a decision was consistent with a development plan does not mean that it was reached solely because of the development plan."

[45] The provisions of section 25 and other parts of the 1963 Act were considered in Grampian Regional Council v Secretary of State for Scotland. The House of Lords affirmed a decision by a majority of an Extra Division. The words of Lord McDonald in the Court of Session at page 21 of the report are of assistance:

"On the other hand in Scunthorpe Borough Council v Secretary of State for Environment [1977] J.P.L. 653, it was held that in deciding whether or not to grant a certificate it was necessary to assume that there was no public proposal to buy the land and also to set aside any allocation of the land in the development plan which would necessarily involve public purchase. ..... If the Scunthorpe decision is correct it would seem to follow that when considering whether or not to grant a certificate a planning authority must set aside not only the fact that a proposal to acquire compulsorily has been made, but all questions of planning policy implicit in that proposal."

In the House of Lords the principal speech was delivered by Lord Bridge of Harwich. It is of note that, at page 31, his Lordship approved the decision in Bell v The Lord Advocate. However, at pages 29 and 30, he went on to give the interpretation of the House of Lords of section 25 and other parts of the 1963 Act. He said:

"It is said that the only circumstance which the planning authority, or the Secretary of State on appeal, is required to ignore in answering the hypothetical question raised by an application under section 25 is the immediate event which has resulted in the applicant's interest in land becoming one which is "proposed to be acquired by an authority possessing compulsory purchase powers" under section 25(1), in this case the education authority's written offers to purchase. Whilst those offers must be ignored, so runs the argument, the underlying requirement to devote these sites to fulfil the needs of public education remains and affords a complete answer to the claim for positive certificates.

If it were right to confine attention to section 25(3) and (4) and section 30(2) alone, this literalistic argument might have some appeal. If, however, one considers the wider statutory context and the function of certificates of appropriate alternative development and the scheme of the Act as a whole it becomes clear that the argument

is untenable.

First, the argument flies in the face of section 16 of the Act. [Section 16 of the Act provides for a disregard of depreciation due to the prospect of acquisition by an authority possessing compulsory purchase powers.] As Lord Dunpark succinctly put it (supra, p13): 'It seems to me to follow from the fact that the value of the land is not to be affected by the prospect of compulsory acquisition, that its value is not to be affected by the development proposed by the acquiring authority. One cannot discount the one without the other.'

Next, I refer to section 25(7) which provides [his Lordship quoted subsection (7) and continued].

The primary purpose of this provision, in my view, is to obviate the possibility that where, as in the usual case, urban land is allocated to the development plan for a necessary public purpose for which it will in due course need to be acquired, that provision of the plan can be relied on to deny the landowner a positive certificate. If the planning need to use the land for a public purpose, which underlies a proposed compulsory acquisition, is not a sufficient ground to withhold a positive certificate where that need is recognised and provided for in the development plan, I do not see how the underlying planning need can ever be such a sufficient ground.

But the overriding consideration which impels me to reject the argument for the appellants is that it would, in my opinion, if accepted, defeat the essential purpose of the procedure for obtaining certificates of appropriate alternative development, as part of the overall scheme of the Act to secure the payment of fair compensation to landowners who are compulsorily expropriated, or, expressed more specifically, to ensure that, when urban land, otherwise available for some form of urban building development, is acquired for a necessary public purpose, the compensation will reflect its urban development value. Assuming, as I do, that every compulsory purchase of land can be justified by a reference to the public purpose for which the land is required, to allow reliance on that public requirement to determine the question raised by an application under section 25 would lead to the issue of a negative certificate in every case."

In Fox &c v Secretary of State for the Environment, the foregoing principles were applied in England in relation to the situation in which a local authority decided to purchase land for use as open recreational space. The judgment of Roch J. is of interest. Explaining the rationale of the English provisions which are the counterpart of section 25, at pages 477-478 he said:

"The whole purpose of the Parts II and III of the Act is to achieve the result that where a public authority acquires land using compulsory purchase powers for a purchase which will benefit the public generally, or a section of the public, an unfair proportion of the cost of achieving that public purpose is not put among the owners of the land being acquired. Thus if, but for that public purpose, it would have been appropriate for the land to be developed in an alternative way, the price payable for the land is the price payable for land with that development potential. It is now clearly established that not only the proposal by the public authority to acquire the land compulsorily must be ignored but also the planning policies which underlie such a proposal."

Speaking of the provisions of section 17(7) of the Land Compensation Act 1961, he went on:

"Section 17(7) of the Act is supplementary to subsection (4). It provides that a certificate under section 17(4)(a) is not to be withheld because the provisions of the development plan do not permit the alternative development which the applicant for the certificate claimed to be appropriate. Nevertheless, if independently of the provisions of the development plan and disregarding the scheme of the acquiring authority, the alternative development advanced by the applicant is and will remain inappropriate for that land, and the evidence indicates that planning permission for any development other than that proposed by the acquiring authority would not be granted, a certificate can be issued under section 17(4)(b). Although the person deciding what type of certificate to grant must not treat the policies of the development plan as being decisive, he does not have to ignore the true planning characteristics of the land."

It appears to us that these last observations are pertinent in the context of the Scottish legislation also.

[46] In Fletcher Estates (Harlescott) Ltd v Secretary of State for the Environment , the latter observations of Roch J. just quoted, were affirmed, the House of Lords holding that, in determining under section 17 of the Act of 1961 what alternative development would be appropriate, the local planning authority should apply ordinary planning principles to the circumstances existing at the relevant date, namely, the date of publication of notice of the making of the compulsory purchase order; and that, as section 17(4) required it to assume that the scheme for which the land was proposed to be acquired together with the underlying proposal as it stood at the relevant date had been cancelled, it was not required to have regard to all the effects of the proposal that had occurred before that date and that might not have occurred if the proposal had never come into existence. The principal speech was delivered by Lord Hope of Craighead. We refer to his observations at pages 322-323 and 324.

[47] Finally it is appropriate to mention South Lanarkshire Council v The Lord Advocate 2002 S.C. 88, if for no other reason, because that case resembled the present one in respect that, following a refusal of planning permission in respect of certain land, the landowner served on the relevant council a purchase notice under section 169 of the Town and Country Planning (Scotland) Act 1972, the predecessor of section 88 of the 1997 Act. The council did not respond to the service of that notice within the statutory period and accordingly the purchase notice was deemed to have been confirmed with the effect that the council were deemed to have been authorised to acquire the landowners interest compulsorily and to have served a notice to treat in respect of it on the relevant date. Against that procedural and factual background, which is comparable to the circumstances in this case, it is pertinent to note that the First Division of the Court of Session followed the approach in Fletcher Estates (Harlescott) Ltd v Secretary of State for the Environment. At paragraph 12 Lord President Roger, as he then was, concluded that the reasoning in that case fell to be applied in construing the Scottish legislation. In paragraph [13], he went on:

"The conclusion of the House of Lords on the inference to be drawn from these words was (at pp 322H - 322A): 'The position appears therefore to be quite straightforward upon a consideration of the ordinary meaning of the words used in the statute. The assumption which the local planning authority must make relates to the situation as at the relevant date. The scheme for which the land is proposed to be acquired, together with the underlying proposal which may appear in any of the planning documents, must be assumed on that date to have been cancelled. No assumption has to be made as to what may or may not have happened in the past.' Later his Lordship said (at p324D-F): 'The question which the local planning authority, and in his turn the Secretary of State for the Environment, had to answer in this case was therefore a relatively simple one. It was capable of being determined on the assumption that the proposal had been cancelled on the relevant date, in the light of the circumstances existing at that date and by the application of ordinary principles. The question was whether reasons existed for the refusal of planning permission which were quite independent of any scheme for the acquisition of the land for use for the purposes of the proposed bypass ......'. Lord Hope cited in support the passage from the speech of Lord Bridge in Grampian Regional Council at p31 where he explained his understanding of Bell v The Lord Advocate as being a case where the Secretary of State had relied on a planning policy that could be supported on planning grounds quite independently of any scheme for acquisition of the land as public open space."

It is to be observed that in paragraph [30] of his Opinion the Lord President stated that the court did not find it necessary to consider the effect of section 25(7) of the 1963 Act. It is to be taken, in our opinion, that what preceded that observation had to be seen as based upon the provisions of section 25(3) and (4), as interpreted in the authorities.

[48] In a situation where land is actually proposed to be acquired by compulsory purchase for the purpose of the implementation of some scheme for the public benefit, no doubt, there would be no difficulty in the identification of the nature of the scheme in the implementation of which the land was to be acquired. However, in the present case, there is, in fact, no such actual proposal for compulsory acquisition. Accordingly, in our opinion, it becomes necessary to examine the relevant statutory provisions in order to see how the principles described in the authorities are to be applied to a situation such as that existing in this case, where the application for the certificate under section 25 of the 1963 Act arises out of the service and ultimate confirmation of a purchase notice under sections 88 to 94 of the 1997 Act.

[49] In the present case, the sequence of events narrated at the outset of this Opinion culminated in the issue by the respondents of their decision to confirm the reclaimers' purchase notice of 16 February 2000, which was set forth in their decision letter dated 22 March 2001. The effect of that decision was to cause to operate the provisions of section 94(1) of the 1997 Act. That subsection provides:

"Where [the Scottish Ministers] confirm a purchase notice - (a) the planning authority on whom the purchase notice was served, ....... shall be deemed to be authorised to acquire the interests of the owner or lessee compulsorily in accordance with the relevant provisions, and to have served a notice to treat in respect of it on such a date as [the Scottish Ministers] may direct."

In terms of section 99(1) of the 1997 Act, "the relevant provisions" are defined to mean the provisions of Part VIII of the 1997 Act, that is to say sections 188 to 201 of it. Now the mechanism under which the provisions of section 25 of the 1963 Act come to apply to the present situation is to be found in the terms of section 30(2) of that Act. It provides:

"For the purposes of sections 25 and 26 of this Act, an interest in land shall be taken to be an interest proposed to be acquired by an authority possessing compulsory purchase powers in the following (but no other) circumstances, that is to say - ....... (b) where a notice requiring the purchase of that interest has been served under any enactment, and in accordance with that enactment that authority are to be deemed to have served a notice to treat in respect of that interest;.....".

[50] In these circumstances the situation which exists in the present case is that the reclaimers' interest in the land in question is to be taken to be "proposed to be acquired by an authority possessing compulsory purchase powers," albeit that in fact there is in being no scheme in implementation of which compulsory purchase powers are actually being exercised. Nevertheless, in order to enable the provisions of section 25 of the 1963 Act, as interpreted in the relevant authorities to be operated and, in particular, in order to identify the matters which the respondents are, by virtue of those provisions, required to ignore in the granting of a certificate under section 25, it is necessary to find, in the context of this case the equivalent of a "scheme" in implement of which, in other circumstances, compulsory purchase powers might be exercised. It was contended on behalf of the respondents that, in a case such as this, involving a confirmed purchase notice, there was no "scheme", or the equivalent to be treated as cancelled. Alternatively, it was argued that the scheme was simply the acquisition of the land by the local authority under the confirmed purchase notice procedure. We reject both of these contentions, since, in our opinion, to accept them would undermine the whole object to be served by the operation of section 25 of the 1963 Act, in a context where the certificate of appropriate alternative development was sought following a confirmed purchase notice. That object was explained in that part of the speech of Lord Bridge of Harwich which we have already quoted. Further, the respondents' contentions in this regard appear to us to be inconsistent with the approach followed in South Lanarkshire Council v The Lord Advocate. In these circumstances, it is now necessary for us to identify in the context of this case what is the "scheme" and underlying public purpose which is involved in the deemed compulsory purchase that has come into being here, for it is these that are required to be treated as having been cancelled. Only by the identification of that scheme and underlying public purpose can the necessary criterion be evolved by reference to which the respondents' decision of 22 October 2004 can be assessed. To that task we now turn.

[51] Having regard to the fact that the procedure which included the making of the application for a certificate of appropriate alternative development here had its origin in service of the purchase notice based on the circumstance referred to in section 88(1)(a) of the 1997 Act, that is to say, the situation that "on an application for planning permission to develop any land permission is refused", we consider that it is appropriate to examine the reasons for that refusal as an aid to identify the notional "scheme", which requires to be ignored. Although the refusal document itself has not been put before the court, in the report of Mr R W Jackson, dated 24 January 2001, of his hearing in relation to the purchase notice in paragraph 2.2 there is to be found a reference to that refusal. It is there said:

"The company simultaneously applied for outline planning permission for residential development on the purchase notice site. The council refused the application on 15 November 1999 for reasons primarily based upon Local Plan policy designating the site as a Village Nature Park, loss of open space, risk of flooding and precedent."

Upon the basis of that, we consider it proper to conclude that the notional "scheme" consists in the establishment of a Village Nature Park on the appeal site; further, an aspect of the notional scheme may be thought to be the purpose of avoiding loss of open space. We do not consider that the reference in that paragraph to a risk of flooding can be seen as any part of a notional "scheme"; it is, in essence, a reference to a physical characteristic of part of the site about which we will have more to say later.

[52] We are confirmed in the conclusion which we have just reached by considering what is said in paragraph 24 of the Lumsden Report. In that paragraph the reporter observes:

"Given the above, the underlying assumption in a CAAD [Certificate of appropriate alternative development] appeal is that the proposal that gave rise to the CAAD application was cancelled on the relevant date. In this case the proposal concerned relates to intended creation of open space and a Nature Park under the terms of Local Plan Policy LR5. The determination of the application (and any appeal) must therefore address the 'no-scheme world' that would have suddenly emerged from cancellation of this proposal on that date. Ordinary planning principles must therefore be applied to the existing circumstances on the relevant date. .......".

It is plain from this paragraph that Mr Lumsden took the same view as we do concerning the identification of the scheme to be ignored. The policy LR5, to which he refers, is set out at pages 108 and 109 of the appendix; it is designed to promote the provision of new leisure and recreational facilities. The associated table identifies areas where opportunities to achieve that end exist. In relation to Maitland Drive, Torrance it contains a reference to : "The provision of a Village Nature Park".

[53] Some further support for our conclusion may also be obtained from the terms of the negative certificate of appropriate alternative development issued by East Dunbartonshire Council, dated 26 April 2002, with which the reclaimers took issue. It has to be said that the terms of that certificate are in certain respects plainly defective, although no point was made as regards that in the debate before us. Under section 25(4) of the 1963 Act, the terms of which are set out above, whether the planning authority issues a positive or a negative certificate, the certificate is required to state the classes of development for which planning permission would have been granted. The certificate dated 26 April 2002 does not refer to development at all, but simply states that "the only acceptable use of the land would be amenity space for informal recreation and nature conservation interests". The same error is replicated in the decision letter of the respondents, dated 22 October 2004, in paragraph 27, although they simply adopt the language used by the Council in their certificate.

[54] Taking all these matters into account, we conclude that section 25(3) and (4), as interpreted in the authorities, required the respondents to treat as cancelled, or to ignore, the notional proposal to acquire compulsorily, as we have identified it, and, to quote the words of Lord McDonald in Grampian Regional Council v Secretary of State for Scotland at page 21 "all questions of planning policy implicit in that proposal". Furthermore, the effect of the further constraint in section 25(7) of the 1963 Act requires to be considered. The subsection includes the words "the provisions of the development plan relating thereto". As interpreted by Lord Cameron in Bell v Lord Advocate, those words relate to the land in question. His conclusion was that, for section 25(7) to operate, the "provisions of the development plan must therefore be provision which define the type of development which the plan prescribes for this particular land". In this context, what is important in the Strathkelvin Area Local Plan is the Policy LR5.1, at page 108 of the appendix. It provides that:

"The Council will generally support the provisions of new leisure and recreational facilities. ....... The Table below identifies areas where some opportunities exist, which may be taken forward by the private sector in partnership with the public sector."

The associated table LR5 lists leisure and recreational opportunities, the relevant details of which we have already quoted. In our view, by virtue of the provisions of section 25(7) the existence of that proposal could not constitute, of itself, a reason why some other development of the land in question could not be authorised.

[55] With these considerations in mind we now turn to consider the respondents decision letter of 22 October 2004. The decision itself is to be found in paragraphs 12 to 27 of the letter. In paragraph 13, the respondents accept the reporter's reasoning and conclusions that development for residential purposes of the southern part of the site would have been contrary to the development plan at the relevant date. We take this to be a somewhat oblique reference to what the reporter says in paragraph 46 of the Lumsden Report where he states:

"However, I find that residential development on the southern part of the site would involve land that (i) has not previously been developed, (ii) is liable to flood, and (iii) is of value to nature conservation. Even in the 'no scheme world' of the CAAD, I believe that the development of this 'greenfield' area would be contrary to the development plan and national planning guidance. No residential development should therefore be permitted on this part of the site."

In so far as the respondents affirm that part of the reporter's conclusion in their decision, we consider that they were well entitled to do so since the reporter's reasons for his conclusion appear to us to be unconnected to any of the features of the notional "scheme" which he and the respondents are required to treat as cancelled and to ignore. Thus the objection that the southern part of the site is "greenfield" is a reason for refusing permission for residential development which arises irrespective of any proposal for a Village Nature Park, or for public recreation. As the reporter explains in paragraphs 36 and 37 of his report, the flood risk objection similarly applies irrespective of any such proposal. Likewise the value of the southern part of the site to nature conservation is based on the reporter's finding that the low lying part of the site represents an important wetland habitat, as appears from paragraph 35 of his report. The reporter thus appears to have properly understood and followed the approach which the legislation requires.

[56] However, as respects the northern part of the site, the respondents did not affirm the reporter's conclusion. In paragraphs 14 to 26 of the decision letter, the respondents state their reasons for disagreeing with that conclusion, expressed in paragraph 46 of the Lumsden Report, that

..."on the relevant date a limited residential development on the northern part of the site would not have conflicted with the policies of the development plan, suitably trimmed to exclude the proposal giving rise to the Purchase Notice."

In our opinion, in those latter paragraphs of the decision letter, the respondents have fallen into the error of failing to treat as cancelled at the relevant date the notional proposal which we have identified as underlying the deemed use of compulsory powers. As senior counsel for the reclaimers submitted, their reasons are redolent of that proposal. By way of example, while they are careful to avoid explicit reference to the Policy LR5, which would plainly have been a breach of the requirements of section 25(4) and (7) and of the 1963 Act, in paragraph 20 of the decision letter, the respondents found upon this consideration:

"The site would therefore appear to have active and beneficial use as an informal recreation area and, as such, can be regarded as valued and functional open space."

That justification appears to us to be directly founded upon the purpose of avoiding the loss of open space, which we consider was a material part of the notional proposal. In the "no-scheme world", that part of that proposal should have been treated as cancelled and have been ignored.

[57] In paragraphs 20 to 22 of their decision letter, apparently in relation to the northern part of the site, the respondents found upon Policy EP14 of the local plan, as a basis for departing from the reporter's conclusion. That policy deals with, among other things, the need to protect green wedges from development. However, in so doing, the respondents appear to have misdirected themselves as regards the scope of that policy. In paragraph EP14.1 it is made clear that the policy is to apply "in areas where no specific development policies or proposals apply". In terms of the development plan, the appeal site, in our view, cannot be such an area because specific policies or proposals do apply to it, in respect that Policy LR5 specifically relates to that site among others. While, as we have concluded, on account of the provisions of section 25(7) of the 1963 Act, Policy LR5, and the purposes underlying it cannot be erected into a reason for the refusal of a positive certificate, we are not persuaded that the need to ignore that planning proposal for the purposes of issuing the certificate has the wider consequence of expunging the policy from the development plan for the purposes of Policy EP14. It follows that the respondents' reliance upon it in their decision is misconceived. In our view, the effect of that reliance is that they have taken into consideration in the reaching of their decision a circumstance which had no relevance to it.

[58] If, contrary to the conclusion that we have reached, Policy EP14 can be seen to be potentially applicable to the appeal site in particular where Policy LR5 falls to be treated as cancelled, we are nevertheless persuaded that Policy EP14 could never apply to the whole of the appeal site, upon the view that not all of it could be seen as a green wedge. We consider that the northern part of the site must be seen, on the findings of the reporter, as an "infill site", which is defined in the local plan as "vacant or derelict land not in active or beneficial use within the urban area". If that is the position, it follows that the northern part of the site must be a "brown field" site, which again is defined in the local plan as including infill sites. If that part of the appeal site is indeed a brown field site, it plainly cannot be seen as a part of a green wedge, to which policy EP14 applies. From the reporter's factual description of the northern part of the site, it has been used for the deposit of soil and building materials. It is clear that the land is vacant. At least at the relevant date, the public had no right of access and the land was not dedicated to public use. The fact that members of the public may happen to go on to a piece of vacant ground as a short cut, or to exercise a dog, or, in the case of children, to play, or for similar activities does not mean that the land can be properly be said to be in "active or beneficial use". To the extent that the respondents have concluded otherwise, we regard their decision as both perverse and erroneous in law.

[59] In all of these circumstances, we conclude, for the reasons we have stated, that the respondents' decision dated 22 October 2004 cannot stand. Since the Lord Ordinary concluded otherwise, we shall recall his interlocutor of 19 April 2007. We shall quash the decision, dated 22 October 2004, and remit the matter to the respondents for reconsideration and for a fresh decision. We add only for the avoidance of doubt that, although the reasoning which we have called in question relates, on the face of it, only to the northern part of the site, it was accepted before us that there could be no question of the court quashing the respondents' decision in part only.