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Cite as: [2011] UKUT 446 (LC)

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UPPER TRIBUNAL (LANDS CHAMBER)

UT Neutral citation number: [2011] UKUT 446 (LC)

UTLC Case Number: ACQ/262/2010

TRIBUNALS, COURTS AND ENFORCEMENT ACT 2007

COMPENSATION – compensation – preliminary issue – section 17 certificate – meaning and effect

IN THE MATTER OF A NOTICE OF REFERENCE

BETWEEN MICHAEL KINGSLEY Claimant

and

HIGHWAYS AGENCY Acquiring

Authority

Re: Land at Hill Green Farm

Woodford Road

Poynton

Cheshire

Before: The President

Sitting at 43-45 Bedford Square, London WC1B 3AS

on 23 September 2011

Robin Purchas QC instructed by Dechert LLP for the claimant

James Maurici instructed by Treasury Solicitor for the acquiring authority

The following cases are referred to in this decision:

Kingsley v Highways Agency ACQ/262/2009, [2010] UKUT 309 (LC)

Wilson v West Sussex County Council [1963] 2 QB 764

Trinder v Sevenoaks Rural District Council (1967) 204 EG 803

East Suffolk County Council v Secretary of State for the Environment (1972) 70 LGR 595

The following further cases were referred to in argument:

R v Carrick District Council, ex p Shelley [1996] Env LR 273

Re Magrath [1934] KB 415

Rooff Ltd v Secretary of State for Communties and Local Government [2011] EWCA Civ 435

Pearce v Aughton Parish Council (1973) 26 P & CR 357

Secretary of State for Communities and Local Government v Bleaklow Industries Ltd [2009] 2 P & CR 21

Suburban Property Investment Ltd v Secretary of State for Communities and Local Government [2009] EWHC 2018 (Admin)

Smith v East Elloe District Council [1956] AC 736

R v Restormel Borough Council, ex p Corbett [2001] 1 PLR 108

R (Neptune Wharf Ltd) v Secretary of State for Trade and Industry [2007] 2 P & CR 20

I’m Your Man Ltd v Secretary of State for the Environment (1999) 77 P & CR 251

Jeffery v First Secretary of State [2007] EWCA Civ 584

DECISION ON A PRELIMINARY ISSUE

1. The reference in this case concerns a claim for compensation for the deemed compulsory acquisition of land pursuant to a blight notice. The land, an agricultural unit of about 12.60 hectares (31.11 acres) known as Hill Green Farm, Woodford Road, Poynton, Cheshire, was affected by trunk road proposals (the A555/A453 Poynton Bypass), and on 5 September 1997 the claimant served a blight notice on the Highways Agency in relation to the whole of the site. The notice was accepted on 23 October 1997, giving rise to a deemed compulsory purchase of the land.

2. On 5 September 2000 the claimant applied to the local planning authority, Macclesfield Borough Council, for a certificate of appropriate alternative development under section 17 of the Land Compensation Act 1961. The land is in the North Cheshire Green Belt, and the application identified uses of four parts of the land, parcels A, B, C and D, for which it claimed permission would have been granted. This preliminary issue concerns parcel A.

3. The southern edge of the site is located about 300 metres north west of the urban edge of Poynton. Hazel Grove is approximately 850 metres to the north of the site, and Bramhall is a similar distance to the west. Parcel A is 0.37 hectares (0.91 acres) in area and has a frontage of approximately to Woodford Road. The front part of the site is about 25 metres wide and lies between a row of 14 houses on the north-east side and the buildings of Hill Green Farm to the south-west. It contains a dilapidated barn structure and a yard. Behind the front part of the site, which is about 60 metres deep, the land broadens out behind the gardens of three of the houses in Woodford Road. On the north-west side of Woodford Road, opposite the frontage of parcel A, there is a house, and there is a row of 8 more houses on that side of the road slightly further to the north-east. The last of theses houses adjoins a development of 30 houses in a cul-de-sac called Lower Park Crescent. Within the settlement there is a garage that provides car servicing, repairs, diagnostics and MOT testing. It shares a site with a separate second hand car dealership. At Hill Green Farm some of the former agricultural buildings have been converted to business uses. In all the settlement comprises some 50 to 60 dwellings and businesses.

4. On 14 December 2000 the council issued a certificate, certifying “that in its opinion planning permission would have been granted” for the following:

“Parcel A

1. Redevelopment for residential development comprising affordable housing or agricultural workers dwellings subject to satisfying the criteria in policies H7, DC22 and DC23 of the Macclesfield Borough Local Plan 1997.

2. The conversion and use of existing buildings for B1 and/or B8 use subject to satisfying the criteria in policies GC8 and DC3 of the Macclesfield Borough Local Plan 1997.

Parcel A and B and/or A, B and C and/or A, B, C and D (in combination)

1. Conversion and use of the existing buildings (together with other land) as an equestrian centre comprising stabling, livery, indoor/outdoor school, ménage, paddocks, show jumping, dressage, polo and cross country course.

2. Leisure (outdoor sport and recreation) including: country club house on site of existing buildings and

(i) Pitch and putt golf course;

(ii) Golf driving range;

(iii) Tennis courts;

(iv) Bowling green;

(v) Outdoor swimming pool;

(vi) Fishing;

(vii) Essential structures required for (i) to (vi).

Parcel B and C and/or B, C and D (in combination)

1. Leisure (outdoor sport and recreation) including:

(i) Pitch and putt golf course;

(ii) Golf driving range;

(iii) Tennis courts;

(iv) Bowling green;

(v) Outdoor swimming pool;

(vi) Fishing;

(vii) Essential structures required for (i) to (vi).

2. Equestrian centre comprising stabling, livery, indoor/outdoor school, ménage, paddocks, show jumping, dressage, polo and cross country course/exercise course.

Parcel C and D (in combination) and/or D

3. Leisure (outdoor sport and recreation) including:

(i) Pitch and putt golf course;

(ii) Golf driving range;

(iii) Tennis courts;

(iv) Bowling green;

(v) Outdoor swimming pool;

(vi) Fishing;

(vii) Essential structures required for (i) to (vi).

Equestrian centre comprising stabling, livery, indoor/outdoor school, ménage, paddocks, show jumping, dressage, polo and cross country course/exercise course.”

5. The certificate stated that such permission would have been subject to some nine conditions, which were set out, and it concluded:

“In the opinion of the Local Planning Authority, planning permission would not have been granted for any development other than that specified in this Certificate.”

6. Negotiations for compensation ensued following the acceptance of the blight notice, and after a considerable time the present notice of reference was made. The acquiring authority were unhappy about the terms of the section 17 certificate, although they had not appealed against it, and they applied to the Tribunal under section 17(2) for leave to apply for a further certificate. On 19 August 2010, following a hearing, I refused the application (see ACQ/262/2009, [2010] UKUT 309 (LC)).

7. In the course of their negotiations the parties had identified a disagreement that they considered suitable for disposal as a preliminary issue. It arises out of the terms in which the certificate expressed the permission that would be granted in relation to parcel A for “Redevelopment for residential development comprising affordable housing or agricultural workers dwellings”, which was stated to be “subject to satisfying the criteria in policies H7, DC22 and DC23 of the Macclesfield Local Plan 1997.” Policies DC22 and DC23 relate to agricultural dwellings. Policy H7 relates to affordable housing in rural areas, and is in these terms:

“H7 Exceptionally, in rural areas planning permission may be granted for affordable housing on land that would not normally be released for development, provided that all of the following criteria are met:

1 The scheme would meet a genuine local housing need that would not otherwise be met, supported by a housing needs survey

2 The scheme is undertaken by a registered social landlord

3 The occupation of the dwellings shall be limited to those persons who meet the objectives of a registered social landlord

4 The site is located in or adjoining an existing village and is of a scale and character appropriate to the location.”

8. The disagreement between the parties concerned the first part of criterion 4, that the “site is located in or adjoining an existing village”. The Local Plan defines “Village” as –

“A group of houses in a predominantly rural area with some services such as a shop, post office or public house.”

The acquiring authority contended that the group of houses in the vicinity of parcel A was not a village as so defined, lacking as it does any services such as a shop, post office or public house. So, they said, the site did not satisfy the first part of criterion 4, and accordingly it was not to be assumed under the terms of the certificate that planning permission would have been granted for affordable housing. The claimant said that he was entitled to rely on an assumption that planning permission would have been granted for such development, since the certificate had been granted expressly in relation to the site. In view of this disagreement I ordered that the following should be determined as a preliminary issue:

“Whether, in giving effect to section 14(1) of the Land Compensation Act 1961, it is to be assumed that the development for which the section 17 certificate planning permission is assumed to have been granted could not have been carried out unless the site was located in or adjoining an existing village in terms of policy H7.”

9. The relevant statutory provisions, in Parts II and III of the 1961 Act, are as follows:

“14.- (1) For the purpose of assessing compensation in respect of any compulsory acquisition, such one or more of the assumptions mentioned in sections fifteen and sixteen of this Act as are applicable to the relevant land or any part thereof shall (subject to subsection (3A) of this section) be made in ascertaining the value of the relevant interest…

(3A) In determining –

(a) for the purpose referred to in subsection (1) of this section whether planning permission for any development could in any particular circumstances reasonably have been expected to be granted in respect of any land; or

(b) whether any of the assumptions mentioned in section 16 of this Act (but not section 15) are applicable to the relevant land or any part thereof,

regard shall be had to any contrary opinion expressed in relation to that land in any certificate issued under Part III of this Act.

15.- …

(5) Where a certificate is issued under the provisions of Part III of this Act, it shall be assumed that any planning permission which, according to the certificate, would have been granted in respect of the relevant land or part thereof if it were not proposed to be acquired by any authority possessing compulsory purchase powers would be so granted, but, where any conditions are, in accordance with those provisions, specified in the certificate, only subject to those conditions and, if any future time is so specified, only at that time.

17. – (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 local planning authority for a certificate under this section…

(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 time 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 upon the other of those parties.

(4) Where an application is made to the local planning authority for a certificate under this section in respect of an interest in land, the local planning authority shall, not earlier than twenty-one days after the date specified in the statement mentioned in paragraph (c) of subsection (3) of this section, issue to the applicant a certificate stating either of the following to be the opinion of the local planning authority regarding the grant of planning permission in respect of the land in question, if it were not proposed to be acquired by any authority possessing compulsory purchase powers, that is to say -

(a) that planning permission for development of one or more classes specified in the certificate (whether specified in the application or not) would have been granted, but would not have been granted for any other development; or

(b) that 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,

and for the purposes of this subsection development is development for which the land is to be acquired if the land is to be acquired for purposes which involve the carrying out of proposals of the acquiring authority for that development.

(5) Where, in the opinion of the local planning authority, planning permission would have been granted as mentioned in paragraph (a) of subsection (4) of this section, but would only have been granted subject to conditions, or at a future time, or both subject to conditions and at a future time, the certificate shall specify those conditions, or that future time, or both, as the case may be, in addition to the other matters required to be contained in the certificate.”

10. For the claimant Mr Robin Purchas QC submitted that the certificate was a public document, to which effect should be given according to its terms. There was, he said, no ambiguity that would justify reference to extraneous material save so as to give context. In terms of its overall structure the certificate described the relevant class of development and specified the conditions subject to which planning permission would have been granted. No conditions could be assumed other than those specified. The class of development for which planning permission was to be assumed consisted of (a) redevelopment (b) for residential purposes (c) comprising affordable housing (d) subject to satisfying the criteria in policy H7. Applying those criteria, the affordable housing would be such as to meet a relevant local need; the redevelopment is to be undertaken by a registered social landlord; and the occupation was to be by those who would meet the objectives of a registered social landlord. No difficulty would arise, Mr Purchas said, in applying criteria 1, 2 and 3 in this way. They formed part of the description of the class of development for which planning permission was to be assumed. The second part of criterion 4 (“The site…is of a scale and character appropriate to the location”) could be given good and consistent sense if it was treated as requiring that the development should be of a scale and character appropriate to the location.

11. The first part of criterion 4 (“The site is located in or adjoining an existing village”), Mr Purchas said, was clear. It was not a description of the class of development but of the site. It would be material to the question whether planning permission would be granted. The certificate states that planning permission would be granted for this site, and it would be internally contradictory to contend that planning permission would not be granted because the site is not within or adjoining an existing village. Full meaning for the terms and context of the certificate could be achieved, Mr Purchas said, by applying just those criteria of policy H7 that described the class of development, that is to say, all the criteria with the exception of the first part of criterion 4.

12. Mr Purchas submitted in the alternative that the reference to the criteria in policy H7 should be taken to be a statement of the conditions to which planning permission for affordable housing would be subject. On this approach the first part of criterion 4 would fall to be disregarded for the same reason as it would fall to be disregarded if the criteria were treated as describing the class of development.

13. For the acquiring authority Mr James Maurici pointed out that the primary way in which Mr Purchas put his case was not the way in which it had been put in the claimant’s statement of case. There it was only the conditions argument that was advanced. Mr Maurici submitted that the policy H7 criteria, including the first part of criterion 4, were either to be treated as conditions to which the assumed planning permission would be subject, or alternatively as a statement that permission would only be granted at a future time, that is to say when each of the criteria in policy H7 was satisfied.

14. Mr Maurici submitted that in interpreting the certificate regard should be had to the terms of the council’s resolution to issue the certificate and to the planning officer’s report recommending what the certificate should contain. The planning officer’s report said this in relation to plot A:

“PLOT A:

This site lies within the North Cheshire Green Belt as do all the plots. This site lies within a small frontage of existing residential development along Woodford Road and is currently occupied by agricultural structures. The application suggests residential, B1 Business and B8 Storage and Distribution would be appropriate on this site. Development for open market housing would not accord with the advice in Planning Policy Guidance Notes or policies in the Local Plan. Development for affordable housing or agricultural worker’s dwellings would depend on justification being made at the appropriate time. Conversion or use of the existing buildings for B1 or B8 Use may be achievable but much would depend on the site’s specific scheme as the application amounts to an Outline planning proposal. Having regard to the proximity of this frontage site to adjacent properties along Woodford Road, there may be some loss of residential amenity were business uses to be permitted on the site. In the absence of any special circumstances at this time, it is concluded that none of the uses sought for residential or business use would be appropriate.”

15. Having discussed the uses proposed for parcels B, C and D, the report concluded as follows:

“3. It is concluded in respect of each of the proposals that outdoor sport and recreation would be an appropriate use subject to scale, impact and the type and amount of traffic to be generated, together with the protection of residential amenities for those properties fronting onto Woodford Road. However, residential uses, whether open market housing, single large country houses, affordable housing or agricultural worker’s dwellings are either not justifiable at the present time or would in any event be inappropriate development. With regard to business use, it is not considered that a business use on this site would be appropriate having regard both to the content of planning policy for the Green Belt and also with regard to the proximity to adjacent residential properties.

4. Accordingly it is recommended that a Positive Certificate be granted for appropriate Green Belt uses but a Negative Certificate for residential or commercial uses.”

16. In the light of this report the planning committee resolved as follows:

“That the application be delegated to the Chief Planning Officer in consultation with the Principal Solicitor, to issue the Certificates in accordance with the recommendation and to incorporate the views of the Joint Highways Manager.”

17. At the hearing both parties advanced their cases on the basis that effect had to be given to the planning permission that the certificate said would be granted in relation to parcel A. I pointed out that the criteria in H7 were criteria related to the question whether permission should be granted for affordable housing, so that a statement that planning permission would be granted for such development subject to the criteria in policy H7 appeared to mean not that permission would be granted but that it might or might not be granted. Following the hearing I suggested in a note to counsel that if the certificate had stated expressly that permission might or might not have been granted for agricultural dwellings or affordable housing, it would not have been stating that permission would have been granted for such classes of development; and therefore the statement itself would properly fall to be treated as having no effect for the purposes of section 17. The same would appear to be the case where, though not stated expressly, it was necessarily implicit in the words used in the certificate that permission might or might not have been granted. I invited further written submissions on this point.

18. Mr Maurici in his further submissions drew attention to the acquiring authority’s amended statement of case, in which three interpretative “scenarios” had been advanced. The first of these was that this part of the certificate was meaningless for the reason that it stated that permission would have been granted subject to the satisfaction of criteria, some of which could not be satisfied in this location. Mr Purchas reiterated his earlier submission that effect ought to be given to the whole of the certificate and said that there was no justification for construing the certificate in a way that necessarily meant that the authority had failed to discharge its statutory function. He submitted that it was not legitimate to have regard to extraneous material in construing the certificate, but that if, contrary to this, reference was to be made to the background, he placed reliance of the witness statement of Mr Justin True, the claimant’s solicitor. This statement exhibited notes that had been taken by counsel at the committee meeting and an exchange of correspondence on the drafting of the certificate.

19. The starting point, in my judgment, is this. The certificate must be construed in relation to the terms of the statutory provisions. Under section 17(4), unless the authority consider that planning permission would only have been granted for development for which the land is to be acquired (see section 17(4)(b)), they must issue a certificate stating that planning permission for development one or more classes specified in the certificate would have been granted, but would not have been granted for any other development (see section 17(4)(a)). If they consider that planning permission would only have been granted subject to conditions, the certificate must specify those conditions (section 17(5)); and, if they consider that planning permission would only have been granted at a future time, the certificate must specify that future time (ibid).

20. In form the certificate that was issued accorded with section 17 in this respect: it was expressed so as to state the classes of development for which planning permission would have been granted; to specify the conditions to which any such grant of permission would have been subject; and to state that permission would not have been granted for development other than that specified. The difficulty arises, however, because, whilst following a form that accorded with section 17, the certificate contained a qualification in relation to affordable housing and agricultural workers dwellings: “subject to satisfying the criteria in policies H7, DC22 and DC23 of the Macclesfield Local Plan 1997.”

21. The principal function of the local plan policies is to identify the development that may receive planning permission by specifying the criteria that need to be satisfied before permission is granted. Thus policy H7 is expressed in the terms, “Exceptionally, in rural areas planning permission may be granted for affordable housing on land that would not normally be released for development, provided that all of the following criteria are met;” and policy DC22, dealing with permanent agricultural dwellings, states, “Planning permission will be granted for proposals to create a permanent dwelling for a full-time farm or forestry employee in the countryside only when all the following criteria are met:…” To state, as the certificate did, that permission would have been granted for residential development comprising affordable housing or agricultural workers dwellings “subject to” those policies is necessarily to imply that permission might or might not have been granted for such development depending on whether or not the criteria were met. But a statement that planning permission might or might not be granted does not accord with section 17.

22. The arguments advanced by the parties at the hearing sought to bring what is stated in this way in the certificate within the scope of section 17 in three alternative ways. First there was Mr Purchas’s contention that the criteria in H7 (with the exception of the first part of criterion 4) should be read as defining the class of development for which planning permission would have been granted. The class of development would thus be: “Development for affordable housing in a scheme (a) that would meet a genuine local housing need that would not otherwise be met; (b) that is supported by a housing needs survey; (c) that is undertaken by a registered social landlord; (d) in which occupation of the dwellings is limited to those persons who meet the objectives of a registered social landlord; and (e) is of a scale and character appropriate to the location.” Stated in that way this is not, in my judgment, a class of development as that term is used in section 17 or has been used in the planning legislation from before 1961 (for example in connection with development orders and use classes orders), that is to say a category of development described by reference to generalised features. Mr Purchas said that it was similar to the descriptions considered in Wilson v West Sussex County Council [1963] 2 QB 764 (“an agricultural cottage”), Trinder v Sevenoaks Rural District Council (1967) 204 EG 803 (“detached bungalow or house for occupation by an agricultural worker”) and East Suffolk County Council v Secretary of State for the Environment (1972) 70 LGR 595 (“erection of a farm worker’s dwelling”). However, a comparison of those descriptions with the one above shows that there is no similarity. It is simply not realistic, in my view, to attempt to translate the H7 criteria, which prescribe requirements that must be satisfied before permission is granted, into a description of the features of a class of development.

23. The second way in which it was sought to bring the words of the certificate within section 17 was to say that the criteria in policy H7 (and, no doubt, the same would have to go for policies DC22 and DC23, the agricultural dwelling policies) were to be treated as conditions subject to which planning permission would be granted. There are, however, two reasons why this cannot be the correct approach. The first is that the certificate states expressly the nine conditions to which planning permission for the classes of development would be subject. The fact that the criteria are not included shows, in my view, that they were not considered to be conditions. Secondly, conditions imposed so as to give effect to the terms in which the criteria are stated, with the exception of a condition relating to criterion 3 (limitation on occupation), would not comply with the advice in Circular 11/95 or be valid in law. A condition, for instance, that the development must “meet a genuine local housing need that would not otherwise be met” is so imprecise as to be incapable of enforcement, and in any event there is nothing to establish whether it would operate as a restriction on the commencement of development or on the occupation of the dwellings.

24. Thirdly, there was Mr Maurici’s contention that if the first part of criterion 4 is not to be construed as a condition it should be construed as a specification of a future time at which planning permission would have been granted, that is to say the time when the site satisfies the requirement for location in or adjoining an existing village (by, presumably, the establishment of a nearby shop or a post office or a public house or some other services such as those). I cannot accept this way of putting it. While the certificate follows a structure that was evidently intended to comply with section 17(4) and (5), stating the classes of development for which planning permission would have been granted and specifying the conditions to which planning permission would have been subject, it does not purport to specify any time for the future grant of planning permission. Moreover it does not seem to me that an event as nebulous as the time at which all the criteria in policy H7 are met (and it would have to be this, not simply the time, if any when the settlement might satisfy the definition of a village in the local plan) could possibly constitute the specification of a time for the purposes of section 17(5).

25. In any event I do not accept the basic thesis of Mr Purchas’s argument that for the purpose of construing the certificate there is a difference in principle between the first part of criterion 4 and the other criteria in policy H7. I can see nothing that would compel the assumption that the requirement that the site must be in a village must be taken either to have been satisfied at the relevant date or to be ignored or treated as overridden. The site clearly had the potential to satisfy the requirement, contained as it is within a settlement of 50 to 60 dwellings and businesses. If nevertheless it did not satisfy the requirement at the relevant date for the reason that the settlement lacked any material services, it might nevertheless satisfy that requirement at some future time if such services came to be provided – just as (looking a criterion 1) there might have been no “genuine local housing need” at the relevant date but such need might arise in future. I do not accept therefore that what was said in the certificate implied that the first part of criterion 4 was satisfied or should be treated as satisfied.

26. The efforts made by the parties to bring within section 17 what is stated in the certificate in relation to parcel A derives from an approach that requires that effect for the purposes of section 17 must be given to all that the certificate contains. I fully accept that in principle the approach should be to seek to give effect to the totality of the document. But the certificate must be construed in the light of the statutory provisions that give rise to it. As I have said, the clear implication of saying that permission would have been granted “subject to” criteria in the local plan that have the function of determining whether or not permission should be granted is that permission might or might not have been granted, depending on whether the criteria were satisfied; and, if the certificate had stated expressly that permission might or might not have been granted for agricultural dwellings or affordable housing, the inescapable conclusion would be that it was not stating that permission would have been granted for such classes of development; and therefore the statement itself would properly fall to be treated as having no effect for the purposes of section 17. This would cause no difficulty at all for the operation of the rest of the certificate. Unlike a compulsory purchase order or a planning permission a section 17 certificate only requires to be interpreted for the purposes of determining the compensation payable to the claimant by the acquiring authority. Here the certificate did not say expressly that permission might or might not have been granted for these classes of development, but this was necessarily implicit in what it did say. Accordingly on a proper construction of the certificate, in my judgment, it does not state that planning permission would have been granted for those classes of development in the unqualified way that section 17 requires.

27. I have reached this conclusion simply on the basis of the words in the certificate and the provisions of the Local Plan to which it refers. I do not think that there is any need to refer to extraneous material. If, however, there were doubt as to the meaning of the certificate it would undoubtedly be appropriate to have regard to the resolution of the council pursuant to which it was prepared and the report of the planning officer on which the resolution was based. The function of the certificate is to provide an input into the assessment of compensation for the deemed compulsory purchase, a matter that concerns only the claimant and the acquiring authority. Both are well aware of these documents. The recommendation, which the council adopted, was that a positive certificate should be granted for Green Belt uses and that a negative certificate should be granted for residential and commercial development. Moreover the report, in saying that “development for affordable housing or agricultural worker’s dwellings would depend on justification being made at the appropriate time”, makes clear the officer’s view that permission for this might or might not be granted, and his recommendation was founded upon this. To treat what the certificate said in relation to agricultural dwellings and affordable housing as not stating that planning permission would be granted for those uses would therefore accord with the terms of the council’s resolution and the officer’s report. There is nothing in the witness statement of Mr True and the correspondence to which he refers that suggests to me that the view of the council was other than the one that appears from the officer’s report.

28. The result, therefore, is that under section 15(5) the development for which it is to be assumed that planning permission would have been granted does not in my judgment include residential uses. This is a conclusion that effectively subsumes the preliminary issue and makes a specific answer to it unnecessary, although, as I have said, the ineffective part of the certificate was not intended to suggest, and did not, that the site should be taken to satisfy the requirement in policy H7 that it must be located in or adjoining a village as defined. It is not the effect of the Act, however, that the negative part of the certificate requires it to be assumed that the hope that permission might be granted for such uses is to be ignored. There is no provision to this effect, and section 14(3) provides:

“Nothing in [sections 15 and 16] shall be construed as requiring it to be assumed that planning permission would necessarily be refused for any development which is not development for which, in accordance with those provisions, the granting of planning permission is to be assumed.”

Thus the possibility of permission that the planning officer envisaged in his report and which was reflected in the ineffective part of the certificate can be brought into the reckoning if it gives rise to hope value.

29. I would add that sort of the problems that have arisen with the section 17 certificate in this case are unlikely to arise in future when Part 9 of the Localism Act 2011 is brought into force. Section 234 of the Act, besides substituting new sections 14 and 15 for sections 14 to 16 of the 1961 Act, substitutes also a new section 17 and a new section 18, which provides a right of appeal to the Upper Tribunal against a section 17 certificate. Thus in such a case as this it will be open to each party to appeal against the certificate, and it will be for the Tribunal to determine on the evidence what development, if any, is appropriate alternative development for the purposes of section 14 – that is to say, development for which at the valuation date planning permission could reasonably have been expected to be granted on the valuation date on the assumptions set out in subsection (5) (see subsection (4)). And, whether a section 17 certificate has been sought or not, under section 14(3) compensation will fall to assessed on the assumption that planning permission would have been granted for appropriate alternative development.

30. The parties are now invited to make submissions on costs, and a letter relating to this accompanies this decision, which will become final when the question of costs has been determined. There have been previous indications that the parties would wish mediation to take place following the determination of the preliminary issue. If it is confirmed that they are still agreed about this I will order the proceedings to be stayed for a suitable period to allow mediation to take place.

Dated 23 November 2011

George Bartlett QC, President