IN THE HIGH COURT OF JUSTICE
QUEEN’S BENCH DIVISION
CROWN OFFICE LIST
		CO/1588/99

Royal Courts of Justice
Strand, London WC2A 2LL

Tuesday 18th April 2000
B e f o r e 

MR JUSTICE LIGHTMAN

BETWEEN:

William Morrison Supermarkets Plc
Applicant

and

Secretary of State for the Environment, Transport & Regions
First Respondent
Stockton on Tees Borough Council
Second Respondent
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(Transcript of the Handed Down Judgment of
Smith Bernal Reporting Limited, 180 Fleet Street
London EC4A 2HD
Tel No: 0171 421 4040,  Fax No:  0171 831 8838
Official Shorthand Writers to the Court)

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Mr Andrew Gilbart QC (Instructed by Messrs Hammond Suddards, 2 Park Lane Leeds, LS3 1ES) appeared on behalf of the Applicant.

Mr David Elvin (Instructed by the Treasury Solicitor, Queen Anne’s Chambers, 28 Broadway, London SW1H 9JS) appeared on behalf of the First Respondent.
The Second Respondent did not attend and was not represented.

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Judgment
As Approved by the Court

Crown Copyright ©

INTRODUCTION
1.	This is an application by William Morrison Supermarkets Plc (“the Applicant”) under Section 288 of the Town and Country Planning Act 1990 (“the 1990 Act”) to quash a Decision in a letter dated the 16th March 1999 (“the Decision”) of the Secretary of State for the Environment, Transport and the Regions (“the Secretary of State”).  By the Decision of the Secretary of State, following the recommendation of a report by an inspector (“the Inspector”), dismissed the Applicant’s appeal under Section 78 of the 1990 Act against the refusal by the Stockton on Tees Borough Council (“SBC”) to grant planning permission for a superstore, petrol filling station and training centre on the appeal site at Stockton & Billingham Technical College (“the College”).  The Applicant’s complaint is that it has been substantially prejudiced by the failure of the Secretary of State to take into account two factors recognised by the Inspector as favouring the grant of the permission and the conduct of the Secretary of State in receiving and taking into account representations made after the date of the Inspector’s report without communicating them to the Applicant and affording the Applicant an opportunity to comment on them.

RELEVANT LAW
2.	The Secretary of State as decision-maker was under a statutory duty: (1) (under Section 70(1) of the 1990 Act) to have regard to the Development Plan and to all material considerations; and (2) (under Section 54A of the 1990 Act) to determine the application in accordance with the Development Plan unless material indications indicated otherwise.  The duty under Section 54A did not require adherence to the Development Plan but only permitted departure if material considerations indicated otherwise: per Lord Hope in City of Edinburgh Council v. Secretary of State for Scotland [1997] 1 WLR 1447 (HL Sc).  The Secretary of State is required to have regard to a matter as a material consideration if the relevant statute so requires or if it might make a difference to his conclusion if it were not taken into account: per Glidewell LJ in Bolton MBC v. Secretary of State for the Environment [1990] 61 P&CR 343.  National policy is a material consideration to which regard must be had and if the Secretary of State is minded to depart from it he must give his reasons for doing so: EC Gransden v. Secretary of State for the Environment [1986] JPL 519.  The Secretary of State must give reasons for his decision: Rule 17(1) of the Town and Country Planning (Inquiries Procedure) Rules 1992.  Those reasons must be adequate, intelligible and deal with the principal issues which have been raised which were necessary for him to decide: MIT Securities Ltd v. Secretary of State for the Environment [1998] JPL 138.  An account of the reasoning must be sufficient to enable the parties and the Court to understand that reasoning: per Lord Clyde in City of Edinburgh v. Secretary of State for Scotland [1997] 1 WLR 1447 at 1465 b-d.  Only if on a down-to-earth reading of the Decision there is a genuine (as opposed to a forensic) doubt as to what he has decided and why will the Court intervene.  A developer suffers substantial prejudice if the reasons are not sufficiently clear to allow him to make a reasonable assessment of the prospects of succeeding on an application for some alternative form of development: per Lord Bridge in Save Britain’s Heritage [1991] 1 WLR 153 at 167H.  The Secretary of State must not take into account evidence or representations adverse to the appellant and put forward after the close of the inquiry (most particularly when the evidence goes to one of the principal issues before him) unless he allows the appellant the opportunity to comment upon it and failure to comply with this duty is a breach of natural justice: Fairmount Investments Ltd v. Secretary of State for the Environment [1976] 1 WLR 1255 at 1263D and Seddon Properties Ltd v. Secretary of State for the Environment [1978] JPL 835.  If the breach causes substantial prejudice, the Court may quash the decision: R v. Bickenhill PC ex p. Secretary of State for the Environment [1987] JPL 773 at 779.

FACTS
3.	The case concerns a proposal by the Applicant to build a superstore on the edge of Billingham town centre on the site of the College.  The site was to be purchased and the College relocated with the funds thereby raised.  At the public inquiry before the Inspector, SBC opposed the grant of permission on (amongst other) grounds that the proposed superstore would be an out-of-centre store in PPG6 terms which would be a departure from the Development Plan and would harm the town centre.  SBC argued that there was no need (though their technical, and only, witness on the issue at the inquiry did not agree) and that there was inadequate linkage between the superstore and the town centre.  The Applicant argued that there was a clear need for a large new superstore in Billingham; the appeal site was an edge-of-centre and not an out-of-centre site; the sequential assessment revealed no site for a superstore preferable to the appeal site; the proposal would enable the College to relocate to a central campus within the Borough and the establishment of a new training centre on the appeal site which would be of value in educational terms and would enable valuable costs savings to be made to the benefit of educational provision and in accordance with national policy; and that (in accordance with Sections 54A and 70 of the 1990 Act) the advantages of satisfying the need and the benefits achieved by the relocation of the College as “material considerations” had to be taken into account and weighed against the factors militating the other way and in particular departure from the Development Plan and the harm to the town centre.  Asda has a town centre store which is a significant magnet underpinning much of the current vitality and viability of the existing town centre.  Asda submitted  representations that they were in the process of assembling an alternative site in the town centre and if the development went ahead they would abandon these efforts and close their store in the town centre.  The Inspector concluded that:
(a)	it had not been demonstrated that there was a viable alternative site.  The Asda scheme would not materialise within a reasonable time;
(b)	the site was not truly an edge-of-centre but rather an out-of-centre site due to inadequacies of the linkages which would require improvement if edge-of-centre status was to be achieved;
(c)	the relocation of the College, in the view of  the relevant Government Department, represented value for money from public funds and was in his view a sensible one;
(d)	the scheme would have an adverse effect on the vitality and viability of Billingham town centre;
(e)	the environmental effects were acceptable; and
(f)	overall the scheme would be in conflict with the Development Plan and would not be acceptable as the disadvantages outweighed the advantages.

4.	After the close of the inquiry and prior to the Decision there were two material developments.  First on the 16th February 1999, the Secretary of State issued a statement of national policy adding to and clarifying the advice in PPG6.  This stated that, where proposals were made for shopping and leisure schemes in an edge of centre or out of centre location “the need for such proposals should be considered carefully when determining planning applications”.  This statement gave new and added importance to the factor of need.  The second was the receipt by the Secretary of State of a number of further representations from (amongst others) two parties who made representations at the inquiry namely Asda and the “Save Our College Campaign” a local action group comprising local residents and traders in Billingham who were campaigning to save the College.  Asda informed the Secretary of State that it was liaising with SBC in respect of its scheme but discussions were in abeyance pending the Decision.  The action group enclosed a sample page from their latest petition.  The Applicant’s solicitor heard that some further representations (in the form of a petition) had been made after the close of the inquiry and on the 10th March 1999 wrote to the Secretary of State asking to see them.  The Secretary of State did not reply to this letter nor did he disclose the representations until in his Decision he referred to them and stated that he had taken them into account.  He went on to say that (save for two letters which he discounted) they did not raise any new issues which were not considered at the public inquiry.  On the 30th March 1999 the Secretary of State made the Decision.  The material parts of the Decision read as follows:
“Inspector’s Recommendation and Summary of the Decision
2.	A copy of the Inspector’s report is enclosed.  His conclusions are at paragraphs 10.1 to 10.22 of his report (IR), and his recommendation at IR12.1 is that planning permission should be refused.  Having carefully considered the report, and the evidence submitted by the parties to the Public Inquiry, the Secretary of State agrees with the Inspector’s recommendation that planning permission should be refused.
...
Preferred locations for retail development - the sequential approach
5.	The Secretary of State agrees with the Inspector’s conclusions (IR10.7) about the lack of availability of a suitable alternative town centre site, and with his view (IR10.12) that the appeal site cannot be regarded as truly edge of centre.  He considers that your client’s proposal is for an out of centre site, which is locationally the least preferable in national planning policy terms.
6.	The Secretary of State accepts the Inspector’s view (IR10.7) that there is no short-term prospect of a redevelopment scheme in the town centre.  Allowing your client’s appeal would effectively preclude the efforts by Asda, or any other developer, from redeveloping the existing town centre or its fringes.  The Secretary of State considers that he is not obliged to support the development of an out of centre site now, if this would prejudice the long term improvement of the town centre proposed in the recently adopted Stockton on Tees Local Plan.  In his view, this is an important consideration, which constitutes an additional reason for refusing your client’s application.
Impact of the proposal on the vitality and viability of Billingham Town Centre
7.	The impact of the application on Billingham town centre is a key consideration in this appeal. ... he agrees with the Inspector’s conclusions (IR10.17) that the inevitable result of the proposed store opening on the college site would be a great reduction in the vitality and viability of Billingham town centre.
8.	It was accepted by your client (IR.20) that the existing Asda food store in the town centre would close if the proposal were to go ahead....
Impact of the Proposal on travel and car use and accessibility of the site by a choice of a means of transport
9.	The Secretary of State agrees with the Inspector’s conclusions that the proposal would result in a significant reduction in the length of car trips, and that the proposed location is well served by buses (IR10.18).  It is therefore consistent with national planning policy in PPGs6 and 13 with regard to reducing the need to travel and reliance on the private car.
The Development Plan
10.	Section 54A of the Town and Country Planning Act 1990 requires the Secretary of State to determine this appeal in accordance with the development plan unless material considerations indicate otherwise.  The Secretary of State agreed with the Inspector’s conclusions (IR10.22) that the proposal would not conform, because of its location, with Structure Plan policy SH2; or with criterion(i) of Structure Plan policy SH3, and criterion (iii) of policy SH15 of the Stockton on Tees Local Plan because of its adverse effect on the town centre.  He acknowledges that it would be consistent with other criteria in these policies, particularly (vi) and (vii) of policy SH3, but considers that the primary consideration in this case is the government’s intention, expressed in PPG6, to sustain and enhance the vitality and viability of town centres.  He therefore agrees with the Inspector that a determination in accordance with the development plan should lead to a rejection of the proposal.
Summary and Conclusions
11.	The Secretary of State concludes that the proposal would conflict in important respects with the adopted and up to date development plan for the area, and would have a significant adverse impact on the vitality and viability of Billingham town centre, and on the prospects for future investment there.  He considers that the potential harm to the town centre outweighs the benefits of reducing the length of journeys by the private car.
The Decision
12.	The Secretary of State hereby refuses to grant permission for the development proposed by your clients.  This letter conveys his decision to that effect.
...”

5.	The Notice of Originating Motion is dated the 22nd April 1999 and was supported by an affidavit by Mr Philip Maude of the Applicant’s solicitors.  The Secretary of State has filed no evidence in answer.  An application was made for permission to admit a witness statement dated the 10th April 2000.  No reason or explanation was afforded for the delay and in the face of a lack of enthusiasm on my part to admit it, the application was wisely abandoned.
THE ISSUES
6.	The primary complaint by the Applicant focuses upon the failure of the Secretary of State to make any reference to or to take into account two material considerations adverted to by the Inspector as advantages in favour of the development, namely the relocation of the College and the need for a new superstore.  The issue of relocation of the College was clearly on any view an important and controversial issue.  It was of direct relevance to the proposal, for:
(a) it occupied the appeal site;
(b) the development would pay for the College’s relocation to another site, whose development for education accorded with the Development Plan policy;
(c) the Applicant had made it an important part of its case as had the local objectors made it part of theirs;
(d) the Inspector had dealt with this topic in some detail and concluded in paragraph 10.14:
“The necessary statutory processes of consultation have been undertaken and the conclusion of the relevant Government Department is that the proposed move represents value for money from the public funds and would not have an adverse effect on the provision of further education opportunities for people living in Billingham.  The proposed move would appear to be a sensible one, albeit one which will inevitably inconvenience people living within easy reach of the present College.”
But he went on to conclude in paragraph 10.22 that the identified advantages of the development (which included this advantage) were outweighed by the disadvantages.  The Decision however made no explicit reference to the advantage of relocation.
7.	The issue of need for a new superstore was at the core of the Applicant’s application.  This was recognised by the Inspector and reflected in paragraphs 10.1 and 10.2 of his Report, which (so far as material) reads as follows:
“CONCLUSIONS
10.1	Although several of the local residents who spoke at the inquiry felt that Billingham town centre served them well as their local shopping centre there was no dispute between the retail experts that Billingham lacked a modern, large convenience store of the type which would enable the centre to compete effectively with out-of-centre stores in the area.  The evidence for this belief is that only 41% of Zone 1 convenience expenditure, effectively the spending from the built up area of Billingham itself, goes to the town centre, but its main anchor store, Asda, is even so congested.
10.2	Given general acceptance of the need for new retail provision, albeit to remedy largely a qualitative deficiency in floorspace offering adequate choice, the main considerations to be addressed in this case are:
(i)	Does a site exist for new retail provision within the centre, or 	on its fringes?
(ii)	If not, is the proposed site for the store edge-of-centre as 	defined in PPG6?
(iii)	Is the loss of the College from Billingham acceptable in land 	use terms?
(iv)	How would the vitality and viability of Billingham town centre 	by affected?
(v)	Would the environmental impacts of the superstore be 	acceptable?”
In his conclusion at paragraph 10.22 the Inspector refers to the fact that “the proposal would satisfy the identified qualitative need for better convenience shopping in Billingham”, but he goes on to say (in the passage already referred to) that the identified advantages (which include this advantage) are outweighed by the identified disadvantages of the proposed development.  In the Decision (notwithstanding the recent statement of national policy) the Secretary of State makes no explicit reference to the need or the advantage of satisfying the need.

8.	As a matter of law, the Secretary of State was bound to take both the above material considerations into account and the balancing of them (together with the other advantages) against the disadvantages was one of the main issues before him (if not the main issue).  The critical question is accordingly whether on a fair common-sense reading of the Decision the Secretary of State did implicitly take them into account and carry out the appropriate balancing exercise.  I do not think that he did.  The language and structure of the Decision preclude the adoption of the generous construction of it needed to uphold the Decision.  My reasons are as follows:
(1) there is no reference in the Decision to either of these considerations;
(2) in paragraph 2, after referring to the Inspector’s report and conclusions in paragraphs 10.1 to 10.22 and his recommendation at paragraph 12.1 that planning permission should be refused, the Secretary of State says that he agreed with the Inspector’s recommendation: he does not say that he agrees with his conclusions or reasons.  This lacuna would appear to be deliberate, for he goes on expressly to say so when he does agree with his conclusions and reasons;
(3) in paragraph 5 the Secretary of State expressly agreed with the Inspector’s conclusions in paragraph 10.7 (about the lack of availability of a suitable alternative town centre site) and his view in paragraph 10.12 (that the site cannot be regarded as truly edge of centre);
(4) in paragraph 6 he expressly agreed with the Inspector that there is no short term prospect of a redevelopment in the town centre and goes on to give his own additional reason for refusing the application;
(5) in paragraph 7 he expressly agreed with the Inspector’s conclusion that the inevitable result of the proposed store opening will be a great reduction in the vitality and viability of Billingham town centre;
(6) in paragraph 8 he expressly stated that the loss of the Asda store as a convenience outlet if the development proceeded reinforced his concerns about the potential adverse impact of the proposal on the vitality and viability of the town centre as a whole;
(7) in paragraph 9 he expressly agreed with the Inspector’s conclusion that the proposal would result in a significant reduction in the length of car trips;
(8) in paragraph 10 he expressly agreed with the Inspector that a determination in accordance with the Development Plan should lead to a rejection of the proposal;
(9) in paragraph 11 he concluded that the proposal would conflict with the Development Plan and have a significant adverse impact on the vitality and viability of Billingham town centre and on the prospects for future investment there.  He thereupon carried out the only balancing exercise apparent on the face of the Decision, holding that the potential harm to the town centre outweighed the benefits of reducing the length of journeys by private car.  It would appear that this was the only balancing exercise considered appropriate and necessary: clearly in any balancing exercise it was necessary to weigh all the advantages against the harm, and the limitation of the advantages to the reduction of length of journeys by private car is the clearest indicator that the Secretary of State did not have in mind the advantages of relocation and satisfying a need: indeed that can be the only rational explanation for excluding them from the balancing exercise.  In any event, the exclusion of them from the balancing exercise is likewise illegitimate.

9.	The failure to take into account two of the critical factors in the equation in favour of allowing the development in my view renders the decision-making and the Decision open to the most serious question and I am satisfied that there must have been a real possibility of a different conclusion if the proper exercise had been undertaken.  I think that the Applicant has suffered serious prejudice on this ground.  I also think that the Applicant has suffered a serious prejudice because it does intend (if there is any reasonable prospect of success) to continue with its efforts (if necessary by adopting alternative proposals e.g. by improving the linkage) to bring to fruition its plans for the new superstore and for this purpose it needs to know the view of the Secretary of State on relocation and on need and their significance in the context of a fresh application for permission in order to assess the prospects of success of that application.  Accordingly for the above reasons I quash the Decision.

10.	As regards the conduct of the Secretary of State in respect of the receipt of further representations and failure to communicate them to the Applicant, I consider his conduct quite wrong and his failure to respond to the Applicant’s letter inexcusable.  But whilst the conduct in this case is calculated to occasion an unnecessary but well justified sense of grievance on the part of the Applicant, I would not consider that this default on its own occasioned substantial prejudice to the Applicant sufficient to quash the Decision, for it is clear that the communications contained nothing particularly new.  But it is a matter of comfort that this sense of grievance will be allayed by the order I will make on other grounds.

11.	I must conclude this judgment by expressing gratitude for the assistance afforded by Counsel whose submissions in writing and orally were concise and of the highest quality.
12.	MR JUSTICE LIGHTMAN: For the reasons set out in the judgment, which I have just handed down, I shall quash the decision of the Secretary of State contained in the letter dated 16th March 1999.  I shall consider what further directions should be given in the light of what representations are made by counsel either by letter or at a further hearing. Thank you.                                    
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