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Sequential test considered as food store gets go-ahead

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28/07/2016

The Court of Appeal has rejected a challenge to the grant of planning permission for a food store located 500 metres away from the centre of Moreton-in-Marsh, Gloucestershire, ruling that the local planning authority were justified in finding there was a pressing need for the new retail store and it would bring real economic benefits to the town. The outcome in Warners Retail (Moreton) Limited v Cotswold District Council [2016] EWCA Civ 606 reinforces the primacy of the sequential test, but highlights that it is not to be applied rigidly.  The case also involved the court considering and clarifying, once again, some important case-law of relevance for the retail development sector.

Background

In December 2013, permission was granted by Cotswold District Council (the Council) for demolition of existing buildings and erection of a food store with associated parking, landscaping and ancillary works at Fosseway Farm (the Permission).  The site lies approximately 500 metres from the picturesque town centre of Moreton-in-Marsh, Gloucestershire.  The application was originally submitted by Minton Health Care Limited and Glamar Leisure Ltd. (the Applicant), but with Waitrose having expressed interest in the site.  Sainsbury’s Supermarkets Ltd. joined as fourth respondent in the court proceedings, having made an application for a similar development nearby – which the Council refused in September 2013.  The Permission was challenged by Warners Retail (Moreton) Ltd (the Appellant), in its role as owner of a smaller food store, located about 120 metres to the north of the town centre.  The smaller store, operated by Budgens, would apparently lose one-third of its trade if the development proceeded.  The Appellant’s judicial review application was initially rejected in the High Court by Supperstone J in July 2014, leading to the subsequent appearance (and dismissal of the appeal) in the Court of Appeal on 24 June 2016.

The Permission

In granting the Permission, the Council’s Planning Committee acknowledged that the development was contrary to its Local Plan and associated policies – retail developments outside existing settlement boundaries generally being discouraged. The Local Plan stated:

  • proposals for out-of-town development would be subject to a sequential test
  • retail development had to be supported by clear evidence of need
  • there needed to be evidence that the town centre’s ‘vitality and viability’ would be unharmed.

However, the Planning Committee considered there were “material considerations…of sufficient merit…to justify the permitting of the development”. These were enough to outweigh the limited adverse landscape and highway impacts identified.  In particular, the development would:

  • recoup some of the disappearing trade that was escaping from the town to further afield (both to stores and other commercial centres)
  • offer local employment opportunities
  • be accessible from and well-connected to the town centre, with there being no other sequentially preferable sites available in town centre or edge-of-centre locations
  • not adversely impact on the town centre’s vitality and viability
  • reduce vehicle movements and lower carbon emissions
  • concur overall with the NPPF’s principle of sustainable development.

In its decision, the Planning Committee noted that previous national planning policy had required there to be clear justification and need for retail development beyond a town centre. However, the National Planning Policy Framework (the NPPF) had superseded this and introduced the Paragraph 24 ‘sequential test’ – giving preference to retail planning applications for town centre and edge-of-centre / out-of-town development proposals dependent on their relative proximity to existing commercial centres. Reference was also made to the (now withdrawn) practice guidance issued by the government on the suitability of sites for retail development, including the ‘Planning for Town Centres’ (December 2009) document.

The JR Challenge

In taking the matter to the High Court and then the Court of Appeal, the Appellant argued as follows.

  1. There had been errors in the advice from the Council’s Planning Officer. This meant the Planning Committee had misdirected itself in its understanding and application of the NPPF policy for the sequential test and the corresponding parts of the practice guidance.
  2. The Planning Committee had also been misled by the advice received regarding the approach to interpreting and applying policy, particularly relating to the decision in the leading Supreme Court case of Tesco Stores Ltd v Dundee City Council [2012] UKSC 13.

Decision

Lord Justice Lindblom found as follows, with Lord Justice Davis and Lord Justice Beatson in agreement.

  1. Sequential test
  • The Planning Officer’s advice on the sequential test had not been misleading or materially deficient, such as to render the Permission unlawful.
  • By the time the decision was made, the practice guidance was supporting the NPPF rather than its predecessor – so it had to be read in light of current central policy. As emphasised by the High Court, practical guidance should not be applied in a mechanical or rigid way. The finding in Telford and Wrekin Council v SSCLG [2013] EWHC 1638 (Admin) had been correct, in warning that a decision-maker should not interpret guidance “in a rigid, mechanistic fashion”.
  • The NPPF does not require an applicant for out-of-town retail development to show there is a demonstrable need for it before permission can be granted. The Paragraph 24 sequential test is the focus. The ‘need test’ / threshold had been withdrawn when PPS4 was issued in December 2009 and not reintroduced when the government streamlined its planning guidance with the NPPF in spring 2012.
  • The current references in the guidance to need “cannot, therefore, be read as regenerating a test of need. They [do] not”. They simply elaborate on the sequential approach, particularly explaining how the suitability of centrally-placed sites is to be judged.
  • Under Paragraph 24 of the NPPF, applicants and local planning authorities must “demonstrate flexibility on issues such as format and scale”. However, the format and scale for any proposal inevitably depends on the facts and circumstances, as well as the applicant’s preference and intentions. Paragraph 24 is not to be regarded as dictatorial – flexibility is key and it “should not be seen as prescriptive in this respect. It plainly is not”.
  • Correspondingly, the guidance calls for flexibility in the sequential approach, simply in more elaborate terms. A developer’s own intentions may be taken into account and have a bearing – for instance, when considering what demand a proposal is intended to meet and how proposed scale / form of a development is envisaged as potentially making a contribution. However, the sequential approach should not become a self-fulfilling activity and divorced from the public interest.
  • The Planning Committee had not been given incorrect legal advice regarding the need issue. They had been reminded that there was no ‘need test’ in government policy and the Local Plan’s parallel criteria no longer carried weight. However, this did not mean the need for additional food retail facilities in the town was immaterial. Indeed, there was a pressing and clear need.
  • The Planning Committee had applied the sequential test in a way that showed their understanding and flexibility. They had considered ‘availability’, ‘suitability’ and ‘viability’ in accordance with the NPPF and relevant parts of the practice guidance.
  • The Appellant’s view that there was scope for only one food store of the proposed format and scale in the town was incorrect. The Planning Officer had reminded the Planning Committee that the Appellant had an extant permission to extend its own, existing store – so it was clear this had been taken into account, but Permission granted nonetheless.
  • The Planning Committee did not have to (1) consider whether the extended Budgens store could meet the identified need and, (2) if the answer was that it could, find the Applicant’s proposal failed the sequential test due to a lack of need. This would not have reflected the NPPF and related guidance. In fact, such an approach would have wrongly restored the ‘need test’.
  • The view had, justifiably, been taken that there was a pressing need for the new store, with the proposal having the potential to bring real and sustained economic benefits. Although there would be a clear adverse impact on turnover at the Budgens store, there was no preferable site available in or around Moreton-in-Marsh’s town centre. There were also no objections on the grounds of unacceptable impact on the town centre or other relevant planning grounds.

Policy application

  • The interpretation of policies (particularly the sequential approach) considered in Tesco Stores was found to be sufficiently similar to the policy and guidance considered in the present case, so the Planning Officer’s advice had been justified. This was despite Tesco Stores concerning the sequential approach in Scotland, rather than England and Wales.
  • The sequential approach under Paragraph 24 of the NPPF and the practice guidance was not identical to the contents of the development plan policies considered in Tesco Stores. They were just similar in broad intent. However, the need for flexibility and realism was an overriding theme in both.
  • In any event, the point being considered was not how comparative policies were to be viewed and interpreted. Instead, it was whether the Planning Officer’s advice on Tesco Stores was misleading or inaccurate such that it negated the Planning Committee’s decision. The court found that it was not. The Planning Officer had clearly based his advice on a true interpretation of the relevant policy and guidance. This had then been lawfully and reasonably applied to the facts and circumstances of the specific case.
  • An officer’s report should not be construed as though it is an enactment, but in a common-sense way and taking into account that it is addressed to an informed readership. A passage from the leading case of R v Selby District Council ex p Oxton Farms [1997] EGCS 60 was referenced in relation to this: “An application for judicial review based on criticisms of the planning officer’s report will not normally begin to merit consideration unless the overall effect of the report significantly misleads the committee about material matters which thereafter are left uncorrected at the meeting of the planning committee before the relevant decision is taken”.

Key Points and Comment

  • The NPPF does not require an applicant for out-of-town retail development to show there is a demonstrable need for it before permission can be granted. There is no ‘need test’.
  • The sequential test under NPPF Paragraph 24 is the appropriate assessment tool. In referencing need, the guidance simply elaborates on the sequential approach – particularly explaining how the suitability of centrally-placed sites is to be judged.
  • In applying the sequential test, there should be flexibility (particularly on issues such as format and scale). The facts and circumstances of each development proposal will be key. A developer’s own intentions may also be taken into account. However, the sequential approach should not merely become a self-fulfilling activity and divorced from the public interest.
  • Ultimately if there is no available and suitable sequentially-preferable site, with no objections arising on the basis of unacceptable impacts on the town centre or other relevant planning grounds, planning permission should usually be granted.
  • However, this will not mean that the ‘need’ for additional food shopping facilities in a town is completely immaterial. This will still be a material consideration in the overall planning balance.
  • More generally, practical guidance should be applied in relation to current policies in force when a decision is made. However, it is not to be applied in a mechanical or rigid way.
  • The courts are reluctant to interfere with a Council’s planning decisions via judicial review, unless it is overtly clear that any advice, guidance or legal interpretations offered to a Planning Committee were so wrong or misleading that a different decision would possibly have been made. A judicial review application based on criticisms of a Planning Officer’s report will rarely be sufficient to merit consideration before the court.

For further information or advice on the impact of this decision and other recent legislative developments in this area, contact the Planning & Environment team at Walker Morris.

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