R (on the application of FREEMONT (DENBIGH) LTD) (Claimant) v WELSH MINISTERS (Defendants) & DENBIGHSHIRE COUNTY COUNCIL (Interested Party) : FREEMONT (DENBIGH) LTD v (1) WELSH MINISTERS (2) DENBIGHSHIRE COUNTY COUNCIL (2016)

The Welsh Ministers had rightly confirmed (i) notices issued by a local authority under the Planning (Listed Buildings and Conservation Areas) Act 1990 s.55 entitling it to recover its expenses of carrying out works to preserve listed buildings; (ii) a compulsory purchase order authorising the local authority to acquire the site of the listed buildings. The landowner’s challenges to those decisions based on the local authority’s allegedly fraudulent and unlawful conduct were totally without merit.

The claimant landowner applied for permission to seek judicial review of the defendant ministers’ decision to confirm notices issued by the interested party local authority requiring it to pay expenses incurred in preserving listed buildings. The claimant also challenged a compulsory purchase order (CPO) confirmed by the ministers which authorised the local authority to acquire the site of the listed buildings.

The local authority had granted outline planning permission for the claimant to preserve the listed buildings by developing them for residential use. Permission would lapse if development was not commenced within three years. An agreement under the Town and Country Planning Act 1990 s.106 required the claimant to pay a restoration payment and restoration deposit, and the local authority and a bank entered into a bond in support of the claimant’s s.106 obligations, by which the bank undertook to pay the local authority if the claimant failed to make restoration payments, secured by the claimant’s mortgage on the site. The claimant failed to commence development within time or pay the full restoration payments. The local authority did not call in the bond. Under a compromise agreement, the bank paid the local authority £1.9 million and was released from any further obligations. In 2011, some of the listed buildings partially collapsed and the local authority served an urgent works notice (UWN) on the claimant under the Planning (Listed Buildings and Conservation Areas) Act 1990 s.54(5). The claimant did not challenge the UWN but did not carry out the required works. The local authority performed them, then served notices under s.55 for recovery of the sums spent. The claimant challenged the notices and an inquiry was held. The claimant asked the inspector to examine the source of the funds used to pay for the works and the circumstances in which the bank had paid the £1.9 million. The inspector found that, in the absence of any allegation that the local authority had acted fraudulently or otherwise unlawfully, those issues were irrelevant. He considered the relevant matters under s.55(4) and held that the works were necessary to ensure the listed buildings’ preservation, that their costs were reasonable, and that confirming the notices would not cause the claimant hardship. The ministers accepted the inspector’s recommendation to confirm the notices. The local authority made a CPO in 2014. The claimant lodged a statutory objection and a second inquiry was held. The inspector recommended confirmation of the CPO, having rejected the claimant’s case that the local authority had acted improperly in pursuing it. The ministers confirmed the CPO.

 

In its permission application, the claimant contended that the local authority had engaged in unlawful, fraudulent and deceitful conduct for improper purposes, thereby rendering the s.55 notices unlawful, and that the inspector was wrong to find that the recovery would not cause it hardship within s.55(4)(d). In its challenge to the CPO, the claimant submitted that the second inspector and ministers had wrongly proceeded without making a disclosure order in respect of the settlement between the local authority and the bank, and that they had erred in failing to take account of the local authority’s unlawful and fraudulent conduct.

 

HELD: (1) The inspector at the first inquiry was unarguably right to find that the issue of the source of the funding for the works performed by the local authority and the circumstances in which the £1.9million was paid were irrelevant. Under s.55, objections to a payment notice could be made only on the basis of the matters specified in s.55(4). In any event, the second inspector had found that the local authority had not acted improperly, and that conclusion was in evidence before the instant court. Had the first inspector considered that issue, there was no reason to suppose that he would have reached a different conclusion (see paras 72, 74-75 of judgment).

 

The first inspector had adopted the correct legal approach to the issue of hardship and dealt with it at length and with considerable care. The grounds raised by the claimant were unarguable and it was refused permission to apply for judicial review (paras 85-86).

 

(2) The question whether, in the light of the limited scope of the second inquiry, further disclosure was necessary was a case management matter for the second inspector. He had been entitled to conclude that he could deal with the issues raised properly and justly without any further disclosure (paras 91-92).

 

The second inspector had dealt with the allegations of fraud and come to unimpeachable conclusions in respect of them, finding none of the allegations made out. The challenge to the confirmation of the CPO did not require permission to proceed, but it was unarguable (paras 93, 95).

 

(3) Pursuant to the guidance in W v Secretary of State for the Home Department [2016] EWCA Civ 82, the court declared both claims to be totally without merit, W applied (para.109).

 

Permission refused, claim dismissed

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