Legal Viewpoint - Obligations route blocked on parking permit restrictions

Posted by Sara Hanrahan on

This article originally appeared in the 16 June 2017 edition of Planning magazine. 

A Court of Appeal ruling last month involving planning permission to convert a building in west London from five flats to eight explored the lawfulness and enforceability of planning obligations that seek to restrict residents from applying for permits for on-street parking. In 2015, the High Court held that such obligations fall outside the scope of section 106 of the Town and Country Planning Act 1990.

The decision was appealed, with the Court of Appeal dismissing the appeal on 11 May. This confirmed that 'permit-free' restrictions are not capable of being planning obligations under section 106, which allows anyone with an interest in land to enter into an obligation to restrict the use of the land bound by it. The obligations in this case related to restrictions on parking on the adjoining highway and did not prevent the use of the particular flat.

The court went on to determine that such obligations could, however, be enforceable under section 16 of the Greater London Council (General Powers) Act 1974. This enables an owner to enter into a covenant 'in connection with the land'. The court held that there was a 'connection' between the application site and the availability of parking permits, since these are available only to residents of the relevant London borough where the property is situated. For this provision to apply, the section 106 agreement must expressly include section 16 as an enabling power.

The decision will undoubtedly affect future drafting of section 106 agreements. However, it is unclear whether councils outside London, who cannot rely on the 1974 act, will now have any power to secure permit-free development. A possible solution is to base such obligations on section 111 of the Local Government Act 1972, which gives councils wide general powers. Another solution may be to expressly exclude new residences from the instruments creating the relevant parking schemes, an approach approved by the High Court in R (AS Property Investments Ltd) v Hounslow London Borough Council [2008].

More problematic are planning obligations that have already been signed with no other such enabling powers. Councils need to consider carefully how to deal with these. The restrictions may not be binding on successors in title, but this does not mean that the covenants cannot be enforced against the original covenanting party in the same way as any contractual commitment.

R (Khodari) v Royal Borough of Kensington and Chelsea; Date: 11 May 2017; Ref: [2017] EWCA Civ 333

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Sara specialises in urban redevelopment and infrastructure projects, particularly advising in relation to compulsory purchase and affordable housing schemes. She also has niche specialism acting for high net worth individuals.

Sara Hanrahan
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