Case no: CO/1640/2000

IN THE high court of justice
QUEENS BENCH DIVISION
ADMINISTRATIVE COURT

Royal Courts of justice
Strand, London, 
wc2a 2ll

      Tuesday, 14 November, 2000

Before:

MRS JUSTICE SMITH

-------------------

The Queen
-v-
South holland district Council
Appellant
ex parte 
Respondent
Lincoln co-operative society ltd
____________________
(Transcript of the Handed Down Judgment of
Smith Bernal Reporting Limited, 190 Fleet Street
London EC4A 2AG
Tel No: 020 7421 4040, Fax No: 020 7831 8838
Official Shorthand Writers to the Court)
____________________

Mr N. Nardecchia (instructed byAndrew & Co, St Swithn’s Square, Lincoln) for the Appellant

Mr T. Corner (instructed by Marples & Son, 23 New Road, Spalding, Lincs PE11 1DH) for the Respondent

____________________

Judgment
As Approved by the Court

Crown Copyright ©

Mrs Justice Smith:

1.	This is an application by the Lincoln Co-operative Society Ltd (the Co-op), brought with the permission of Scott Baker J, for judicial review of a decision of the South Holland District Council Development Control (Planning) Committee (the Council) on the 23rd February 2000, when they granted planning permission to Westry Developments Ltd (Westry) for a retail development at a site at Station Yard, Long Sutton, Lincolnshire.  

2.	Section 70(2) of the Town and Country Planning Act 1990 states that in dealing with an application for planning permission a local planning authority shall have regard to the provisions of the development plan, so far as material to the application and to any other material considerations.  

3.	Section 54A of the Act requires that a local planning authority shall determine a planning application in accordance with the development plan unless material considerations indicate otherwise.  The relevant development plan for South Holland comprised two documents: the Lincolnshire County Structure Plan Alteration Number 2 ( 1994) and the South Holland District Local Plan (1998).   The Lincolnshire Structure Plan provided at Policy 24A:
‘Major new shopping development within or adjacent to the urban areas but outside their centres as may be defined in local plans will normally be permitted where:
Access is adequate and the additional traffic generated can be   accommodated on the surrounding road network, improved as may be;
The development is sympathetic in scale and character with the      
surrounding landscape/townscape;
The new development would not seriously affect the vitality and availability of any near town centre as a whole. 

4.	The South Holland District Local Plan provided at Policy STC5 that shopping proposals would be permitted on out-of-centre sites where four criteria were satisfied:	
It has been demonstrated through the adoption of a sequential approach to site selection that there are no suitable sites available – firstly in the main shopping area and secondly on the edge of the main shopping area;
The proposals are considered to be of a scale and character appropriate to the town;
The proposals would sustain and enhance the vitality and viability of  the town centre; and
The site is accessible by a choice of means of transport.      

5.	There was also relevant Government Policy Guidance in the form of PPG 6: Town Centres and Retail Developments together with a Ministerial Statement of February 1999 adding to and clarifying PPG6 and PPG 13 on Transport.  

The facts.  

6.	Long Sutton is a small country town in South Lincolnshire.  It has a population of about 4000 but it serves as a shopping and community centre for a number of outlying villages and hamlets.   It is about 4 to 5 miles from  Holbeach a town of about 9,000 inhabitants.    In 1998, Westry applied to the Council for a grant of planning permission to erect a supermarket on a brown field site about 300 metres from the main shopping centre of Long Sutton.  The proposal was supported by a ‘retail effects’ assessment by Alsop Verrill, a firm of consultants instructed by Westry.  This assessment indicated that the proposal would divert trade of about £1,240,000 per annum from retail food and convenience goods shops in the town centre.  This represented about 26% of the town centre’s retail food and convenience goods trade.  

7.	At that time, the Council had before it three separate applications for retail developments.  Two of these related to sites in Long Sutton, one at Station Yard, the other elsewhere.  The third was for a site at Holbeach.  The Council instructed Donaldsons, retail planning consultants, to consider this proposal.  They advised that there was only a need for one new supermarket in the area and recommended that this should be at Holbeach.   They reported that the Station Yard proposal would be harmful to the vitality and viability of the Long Sutton Town Centre because of the diversion of trade and advised that the proposal contravened the Council’s Development Plan and Government planning policies.   The Council’s Head of Planning advised that the Holbeach application should be granted but that both Long Sutton applications should be rejected. Of the Station Yard proposal they said:
‘It is functionally unrelated to the town centre and physically and psychologically separate.  We believe that this would trade as a solus, out of centre foodstore, diverting trade from the town centre rather than bringing economic benefits.  We note also that the impact percentages identified by the consultants (Alsop Verrill) are high …… .’

8.	For the purposes of a meeting of the Council’s Development Control Committee, to take place on 10th November 1998, the Head of Planning prepared a report on the issues.  This concluded with a recommendation that both the Long Sutton proposals be rejected.  He placed before the Committee the executive Summary of a research project carried out by the DETR entitled ‘the Impact of Large Foodstores on Market Towns and District Centres’.  The concluding paragraphs stated:
‘Our research has shown that large foodstores can and have had an adverse impact on market towns and district centres.  The level and consequences of impact will vary upon the particular local circumstances of the centres concerned.  Small centres which are dependent to a large extent on convenience retailing to underpin their function are most vulnerable to the effects of larger foodstore development in edge-of-centre or out-of-centre locations. 
It is vital that those responsible for the future of market towns and district centres take positive steps to improve the range and quality of food shopping in those centres and adopt a cautious approach to considering the location and likely long term consequences of the development of large foodstores in non-central locations’.

9.	On 10th November 1998, the Development Control Committee granted the Holbeach application and refused both the Long Sutton applications on the grounds of the adverse effect on the vitality and viability of the town centre and because the schemes contravened the development plan as evidenced by the Lincolnshire Structure Plan and the South Holland District Local Plan and also contravened the advice in the Government’s Planning Policy Guidance Note 6 (PPG6) on Town Centres and Retail Developments. 

10.	In June 1999, Westry made a second application in respect of the Station Yard site. It was to all intents and purposes identical to their previous application save that it offered to enter into an agreement pursuant to Section 106 of the Town and Country Planning Act 1990 to pay £75,000 to the Council.  In general terms Section 106 provides that an applicant for planning permission may enter into an obligation (including the payment of a sum of money) which, if the permission is granted, will be enforceable against him.  Guidance issued by the Secretary of State in 1991 and reissued in 1997 indicates that planning obligations should facilitate and enhance development proposals but should not be used to extract from developers payments in cash or in kind for purposes not directly related to the proposed development but in effect as the ‘price of planning permission’.  The essence of the 1997 advice to decision makers is that when considering a planning obligation they should ask whether it is ‘necessary, relevant to planning, directly related to the proposed development, fairly and reasonably related in scale and kind to the proposed development and reasonable in all other respects’.  At the time of Westry’s offer of £75,000, the proffered obligation was not related to any particular proposed works.  

11.	In support of its objection to this application the Co-op submitted a report from development consultants, Nathaniel Lichfield and Partners.  This drew attention to the severely adverse effects the proposal would have on the Co-op store, which Donaldsons had described as ‘the anchor’ store in the town centre.  There was a danger that the Co-op store would cease to be viable.  Its viability was claimed to be  crucial to the centre as a whole.  The Co-op had recently been granted permission to expand their premises and they intended to carry out works to improve access to the store.  They submitted that the size of the proposed store (2550 square metres overall with a car park for 255 cars) was of a scale inappropriate for the size of Long Sutton.  The proposed retail area of the supermarket would be 1.5 times the total area presently applied to food retailing in the whole town.  The report attacked the figures in Alsop Verrill’s impact assessment as being too low.  In summary, it opposed the proposal on the grounds of need, scale, harm of the vitality and viability of the town centre and lack of accessibility by a choice of means of transport. 

12.	The Council consulted Donaldsons about this renewed application.  They advised against the proposal on all the grounds on which they had relied in the previous year.  In particular they observed that now it was known that there was to be new retail   development at Holbeach, another such development at Long Sutton could not be justified on the ground of need.  The proposal would have an unacceptable adverse impact on the vitality and viability of the town centre.  It would do considerable damage to existing businesses in the town.  They thought that the figures in Alsop Verrill’s assessment probably underestimated the adverse impact.  The proposed development contravened the Development Plan. 

13.	The Head of Planning’s report for the meeting of 29th September 1999
recommended refusal.  However, on that date the Committee resolved to defer its decision.  Discussions took place between Council officials and Westry and the section 106 offer was increased to £100,000.    The Council then sought legal advice from solicitors Browne Jacobson, who reported on 18th November 1999, dealing with a number of issues, but in particular the legal implications of the offer to pay £100,000 as a section 106 obligation.  In this connection, the solicitor drew attention to the decision of the House of Lords in Tesco Stores Ltd v Secretary of State for the Environment Ltd [1995] 1 WLR  759 and advised that for a section 106 obligation to be taken into account as a material consideration,  it must have more than a minimal connection with the proposed development.  If it did, the weight to be given to it was a matter for the decision-maker.  He also advised that the Council should have regard to the policy set out by the Secretary of State in Circular 1/97 which related to section 106 obligations.  He said that he could not at present advise whether the proposed obligation had any real connection with the development but said that, if the development was likely to harm the town centre and the harm could be removed or materially reduced by the money on offer, then it would be possible to establish the necessary link to make the offer a material consideration.  

14.	In his report prepared for the Committee meeting of 1st December, the Head of Planning recommended that the application be rejected.  He reported that Donaldsons had been asked to consider the offer of £100,000.  Their view was that the sum offered did not have the potential to allow sufficient measures to be taken to redress the harmful effects on the proposed development on the Town Centre.  The Committee deferred its decision again.  

15.	14.  On 11th January 2000, Westry’s agents, Roger Bullworthy Associates, wrote to the Council setting out their suggestions as to how the £100,000 might be used on projects to regenerate and enhance the Town Centre.  They suggested that £50,000 be applied, at the discretion of the Council, for the improvement of transport facilities into and out of Long Sutton. This would be of benefit to the new retail development and to the town centre.   It was suggested that if the scheme were to prove successful, the operators of the new development might be prepared to make further contributions in future.   £10,000 might be applied to resurfacing the pedestrian footways or cycle lanes on West Street, which was one of the two routes connecting the proposed development to the central shopping area. That sum would be enough to resurface up to 500 square metres.    £5,000 could be used to upgrade public notice boards, street lighting and road identification signs.  The object of these would be to encourage motorists to drive into the town instead of using the by-pass.  £20,000 could be ear marked as a contribution to the restoration of the Market House, an old building in the town centre which was in a dilapidated condition, which it was hoped would be made into a community centre.  Finally £15,000 could form a fund to be used by the proposed Town Centre Manager and to be applied to the marketing and promotion of Long Sutton.   

16.	In his report prepared for the Committee meeting of  2nd February, 2000, the Head of  Planning reported the contents of this letter.   The previous reports and legal advice were before them again.   No further advice had been taken on whether the uses proposed for the £100,000 were sufficiently related to the proposed development for it to be proper for the Committee to take the offer into account.  However, the report advised that the examples of what might be done with the money permitted the Committee to decide what weight might be attached to that obligation.  It also gave advice on the correct approach to the decision.   It advised that there must be compliance with section 54A of the Act.   The Committee must determine the application in accordance with the Development Plan unless material considerations determined otherwise.  If the Development Plan pointed to a refusal, and the Committee wished to grant permission, they must be clear in their minds as to what the material considerations were.  As for the Section 106 Obligation, they should consider the examples of how the money might be spent, how the obligation related to the proposed development and the extent to which the payment would deal with any harm which might be caused by the development.   No reference was made to the Secretary of State’s Policy Circular 1/97.   The Head of Planning recommended refusal of the application but advised that it was for the Committee to decide how much weight should be attributed to the obligation offered.  

17.	On 2nd February 2000, the Committee declared that they were minded to grant planning permission but adjourned for further consideration of the conditions to be imposed.  The Minutes of the meeting record: 
‘The Committee was minded to grant planning permission … notwithstanding the recommendation of the Director of Housing and Planning Services, as it was of the opinion that the additional benefits which the applicants would be able to provide under a planning obligation would outweigh the adverse impact which the development might have had on the vitality and viability of the Long Sutton town centre and that the development would therefore not be contrary to the Development Plan.  In addition, the Committee was of the opinion that the provision of a local retail facility would result in a significant reduction in the number of car borne journeys into and out of Long Sutton and would therefore conform with Government Policy in relation to transport.  

18.	On 23rd February, a resolution was passed in the following terms: 
‘Subject to the applicant first entering into a Planning obligation under the provisions of Section 106 of the Town and Country Planning Act 1990 to secure (i) the payment of £100,000 to fund improvements to Long Sutton Town Centre including a rural transport scheme, improvements to pedestrian and cycle links, the renovation of the Market House, the provision of street lighting and road identification signs and the marketing and promotion of Long Sutton, the payment to be index linked from the date of agreement and paid to this Council on the commencement of the development; (ii) the provision of private parking and a barrier for the residents of Numbers 2 to 12 of Station Road; and (iii) the provision of a footpath for public use to to link the site with Dick Turpin Way, the Director of Housing and Planning Services be authorised to grant the permission for the undermentioned development’. 

The Application for Judicial Review. 

19.	Mr Nardecchia for the applicant raised three issues. He submitted first that the planning obligation in this case was not of such a nature that it could be regarded as a material consideration which the Committee was entitled to take into account. Second, if the Committee was entitled to take the obligation into account, they should have weighed its importance in the light of the advice given in Circular 1/97.  The Committee had not had the circular before them and had not taken it into account as they should.  Third, he submitted that the decision to grant permission subject to the proposed obligation was Wednesbury unreasonable. 

The first issue.

20.	The leading authority on the relevance or materiality of a planning obligation is the Tesco case (supra).  At page 770A Lord Keith said: 	
‘ An offered planning obligation which has nothing to do with the proposed development, apart from the fact that it is offered by the developer, will plainly not be a material consideration and could be regarded only as an attempt to buy planning permission.  If it has some connection with the proposed development which is not de minimis, then regard must be had to it.  But the extent, if any, to which it should affect the decision is a matter entirely within the discretion of the decision maker …..’. 

21.	The House of Lords there set a very low threshold test for materiality. They rejected suggestions made in earlier reported cases that the obligation must pass the necessity test or the test of whether it was fairly and reasonably related to the development.  The advice given by the circular set out the principles which the Secretary of State would apply to such decisions if he called the application in for determination.  However, other decision makers were obliged to take the advice in the circular into account, but their decision was not unlawful if they decided not to follow that advice. 

22.	Mr Nardecchia submitted that these proposals were so loosely related to the proposed development and so vague in themselves that it could not be said that they had a connection which was more than de minimis.   He submitted that the major objection to the proposed development was the harm it would cause to the vitality and viability of the town centre. What this meant was harm to the retail businesses.  Diversion of a substantial proportion of the existing trade would be likely to drive some of the existing shops out of business. The diversion of trade advanced in the Alsop Verrill report should be regarded as the minimum which might occur.  Both Donaldsons and Nathaniel Lichfield thought the diversion of trade might be greater.  The proposed obligation, which was to fund general improvements to the town centre, did nothing to reduce or minimise that kind of harm.  The transport proposal might have some potential to bring more shoppers into the town but there was no scheme in existence and nothing had been evaluated.    No one knew what could be done with £50,000 or for how long.   No one had approached a bus company to see whether it was even willing to undertake the provision of such a service. No one had assessed what it would cost to improve existing services or had estimated how many more people might come to shop in the town.   The improvement of the footpaths and cycle ways was also vague and it could not be said that that would redress damage to retail businesses.    In any event the amount of money that it was suggested should be allocated to that project was so small that hardly anything could be done.   Nor would the provision of signs help the retail businesses.   The contribution to the renovation of the Market House was very small and it was not known whether the building would be renovated or, if it was, when it would be done, what it would cost, and what effect it would have on bringing shoppers into the town.   The sum of £15,000 for advertising and promotion of the town was of quite unpredictable effect.  It was not known for how long the promotion would last or even approximately how many visitors it would bring.  Finally he drew attention to the fact, apparent from the resolution of the 23rd February, that the Committee had not committed the local authority to spending the money on any of the specific projects;  it had only bound it  to spend the money on ‘funding improvements to the town centre’.  This proposed obligation failed to pass even the low threshold set in the Tesco Case.  The Committee had plainly taken the obligation into account.  It had been crucial to their decision.  In 1998, the same application without the obligation had been turned down.  Accordingly, the decision should be struck down. 

23.	Mr Corner for the respondent submitted that this proposed obligation passed the threshold test.  He agreed that the main objection to the proposed development was that it threatened to harm the vitality and viability of the town centre.  He contended that any proposal which was designed to improve the town centre was capable of mitigating the recognised harm.  Therefore the proposed obligation had a connection with the proposed development which was more than de minimis.  He submitted that all Mr Nardecchia’s other criticisms went to questions of weight, not the issue of materiality.  

24.	On this issue I accept Mr Corner’s submissions.  It is agreed that in itself the proposed development is likely to harm the vitality and viability of the town centre. It is true that the main area of harm focussed on is the damage to the retail businesses.  One can well understand why that is so.  Amounts of money spent by shoppers are recorded and their spending patterns can be predicted with a modicum of accuracy.  If spending declines, some businesses will fail.   The closure of shops has a generally depressing effect on a town.  I use the word depressing in its colloquial and technical senses.  It is ‘depressing’ for visitors and shoppers to see empty shops in a High Street and the sight may discourage visitors from coming again.  But the closure of shops also affects other businesses to which the shops had provided trade, for example for cleaning or delivery services.   If people do not come to shop, they may not bother to use the Library and so on.  So it seems to me that the harm envisaged to Long Sutton Town Centre cannot be limited to the damage specifically to be caused to the retail outlets alone.  The town centre’s vitality and viability will be damaged more generally that that.  It follows that any proposal which attempts to make the town more attractive to visitors has a potential to mitigate the harm envisaged by this development.  In my view the connection between the supermarket development and some of the suggested proposals for making the town centre generally more attractive and accessible is somewhat tenuous.  However, it does seem to me that a rural transport scheme which enables people to reach the town centre (as opposed to the new supermarket alone) must be capable of having some beneficial effect on the town centre.  Accordingly I hold that this proposed obligation was one which the Committee was entitled to take into account. I should add, however, that I regard this proposed obligation as being at the very lower limit of materiality.  It has just crept across the threshold.   

The second issue.  

25.	Did the Committee take Circular 1/97 into account?  This issue raises a question of fact.  Mr Nardecchia submitted that the Committee had failed to take into account the advice given in Circular 1/97.  He accepted that the Committee was not obliged to follow such advice, but they were required to consider it.  He drew attention to the fact that the policy document was not before the Committee. Browne Jacobson’s advice, which was before them, mentioned the circular by number but did not summarise or explain its contents.   Annex B to the Circular gives detailed advice and many examples of how the principles are to be applied in different situations.  Mr Nardecchia submitted that if this advice had been heeded there was a real possibility that the decision would have been different. 

26.	Mr Roger Smith, the respondent’s Head of Planning, has submitted a witness statement in response to this application.  At paragraph 12, he states that ‘the Committee considers all planning applications made to the Council and its members are familiar with national and local policies including Circular 1/97.’  Mr Corner submitted that I must accept that unchallenged evidence.   Mr Nardecchia submitted that that bare statement was wholly inadequate as an assurance that the Committee had taken the Circular into consideration.   At the very least there should have been evidence from the Chairman of the Committee.  Moreover he submitted that Annex B is a substantial document (in fact 8.5 pages of closely printed A4 paper) containing detailed advice with examples and it is asking too much of any Committee that they should be asked to rely on their memories when taking it into account.   The evidence does not even explain whether and if so how, the circular was made available for them to refresh their memories if they felt the need.  

27.	I must confess that I find this decision difficult.  I am most reluctant to doubt the word of a person such as Mr Smith.  His statement contains a declaration of truth.  Nonetheless, I find it remarkable that a committee of 25 lay people (not planning officers or lawyers) could retain in their minds a working knowledge of this circular, especially when it is said that they are familiar with all the national and local policies as well.  I wondered when and how they would have acquired this familiarity.    I enquired as to the size of the respondent District Council as it appeared to me that it was small and that the Committee would be unlikely to have many applications which would involve consideration of Circular 1/97.  I wondered too why it was thought necessary to obtain basic legal advice from Browne Jacobson if the Committee was familiar with the operation of planning obligations.  

28.	As the Committee is not obliged to give a reasoned decision and did not do so, I cannot draw any inferential conclusions as to whether they did or did not consider the Circular. I am left with the feeling that they probably did not give it the consideration it deserved because, although they may have been familiar with its general message, I doubt if they could have been sufficiently familiar with its content to have been able to do so without refreshing their memories. 

29.	In the event, in the light of my conclusion on the third issue, to which I shall shortly come, it is not necessary for me to resolve this difficult question.  

The third issue:  Wednesbury Unreasonableness.

30.	As Lord Keith said in Tesco, provided that the planning obligation passes the test of materiality, the weight to be attached to it is entirely a matter for the decision maker.  However, on ordinary principles, if the decision is logically flawed or is one which no reasonable decision maker could have made, this court will interfere.  Mr Nardecchia began by referring to the decision as it is recorded in the minutes of the meeting of the 2nd February 2000.  The Committee was minded to grant permission because in its view, the benefits offered by the planning obligation, namely the £100,000 for improvements to the town centre, outweighed the adverse impact of the proposal on the vitality and viability of town centre so that the development was not contrary to the Development Plan.    He submitted that they were to be judged on their own formulation of the decision.  They need not have gone so far as to say that the benefits outweighed the adverse impact.  But having done so, it is that decision which falls to be examined.   They had carried out or purported to carry out a balancing exercise in which the adverse impact of the proposal development was weighed against the benefits which would accrue from the payment of £100,000.   He submitted that the Committee was in a good position to assess the adverse impact as there was a good deal of information before them in the various consultant reports.  They knew that the consultants foresaw a substantial diversion of trade from the town centre.  They knew that Donaldsons, the consultants who had no interest to serve in the advice they gave, thought the figures in the Alsop Verrill impact assessment were probably too low.  They knew that Donaldsons considered that although the new development was only about 300 metres from the shopping centre, it would be physically and psychologically separate and would operate as a solus site.  There would be little or no benefit to the town centre as the result of spin-off trade from shoppers visiting the supermarket and little or no benefit from claw-back, that is from local people who presently shopped elsewhere but who might in future shop in the town.  Donaldsons had described the likely effect on the town centre as unacceptable.  In 1998, the Council had accepted that view and had rejected the application.  

31.	Nothing had changed since then except the addition of the proposed obligation.  Mr Nardecchia submitted that the benefits which this could confer were at present incapable of proper assessment.   Assessment could be no more than guesswork.  Donaldsons had advised that the proposed obligation did not have the potential to redress the adverse effects. Mr Nardecchia referred back to the submissions which he had made under the first issue, which as Mr Corner had pointed out, went more appropriately to the question of weight.   The rural transport scheme transport had not been costed.  The sums suggested for the other projects were very small and unrelated to the retail trade and it was hard to see how they could significantly redress the effect of so great a diversion of trade from the town centre.  He accepted that the Committee was not obliged to accept the advice of professionals and was permitted to apply their own local knowledge.  Even so, this decision was so much against the weight of the material put before the Committee that the only conclusion was that the decision was obviously wrong. 

32.	Mr Corner submitted that the Committee’s decision was a matter of judgement for them and not one with which this court should interfere.  They had concluded that having regard to the benefits offered, the development was acceptable.   He accepted that it was not possible to assess the impact of the benefits precisely.  He pointed out that the Committee had bound the Council to spend the money on funding improvements to the town centre.  It was open to them to take a more general view of the nature of the adverse impact than was apparent from the diversion of trade figures.  Vitality and viability depended on wider considerations than just the retail trade. The Committee had not suggested that the benefits would provide a precise counterbalance to the diversion of trade.  The money was to assist in enhancing the vitality and viability of the town centre.  

33.	The Committee chose to formulate their decision as they did in order to justify what would otherwise have been the grant of a permission which contravened the Development Plan.  They either had to explain why they were granting  permission for a proposal which contravened the Plan or to say that the proposal did not contravene the Plan.  They chose the latter and in my view their decision must be judged on that basis.

34.	Almost every material consideration pointed to the rejection of this application.  Standing alone, the proposed development contravened the Development Plan on the ground of harm to the vitality and viability of the town centre through diversion of trade. That harm was capable of some meaningful assessment.    Although there was some public support for the proposal, there was no need for a supermarket in Long Sutton, particularly after planning permission had been given for one at Holbeach.    For those sound reasons, the proposal was rejected in 1998.  In 1999/2000, those reasons remained as valid and powerful as before.  Nothing was new except the offer of £100,000.  Save in one small respect there had been no evaluation of what could be achieved with that sum.  The only attempt at costing had been to calculate how much re-paving work could be carried out with the £10,000 which it had been suggested should be applied to that project.  The suggestion was that ‘up to 500 square metres’ could be re-paved.  What beneficial effect that might have was unknown.  The suggestion that a substantial sum be used to provide an improved rural bus service appears to have been an important factor in the Committee’s decision.  It made particular reference to compliance with the Government Policy on transport which advocated the provision of alternative means of transport to the motor car.  But, there was before the Committee no information as to what could be achieved with £50,000 or whatever sum the Council would eventually decide to devote to the project.  Nor could they have known for how long the money might last.  This was a single payment with no obligation to any further payment in future.  Westry had said that the store operators might be prepared to contribute something to the bus service in future but there was no obligation and any contribution which might be forthcoming would be on the store operators terms.  The road signs might be effective in bringing visitors to the town but the Committee had no information as to how many such people might come and what they might spend.  In short, the benefits which might be derived from this payment were a matter of pure speculation.  I accept that the Committee is entitled to take into account their members’ own local knowledge.  But I am not persuaded that the Committee’s local knowledge could possibly have given them rational grounds for believing the sum of £100,000 could significantly redress the harm envisaged let alone outweigh it.  In my judgement this decision was such as no reasonable Committee could have taken.  It must be set aside and the Committee should be required to reconsider their decision.  I am sure that on this occasion they will be provided with copies of circular 1/97 and advice on its contents.  

- - - - - - - - - -

MRS JUSTICE SMITH:  For the reasons given in the judgment which has been handed down in this case, the application for judicial review is granted and the application before the committee must be remitted for their reconsideration.
MS COLQUHAN:  I am grateful my Lady.  I appear in place of Mr Nardecchia.  My learned friend, Jonathan Auburn, appears on behalf of the defendant.  I understand that he has an application to make.
MRS JUSTICE SMITH:  Yes.
MR AUBURN:  In relation to costs, your Ladyship, we would ask for a detailed assessment of costs.  I do not know if you have seen the claimant's schedule of costs.
MRS JUSTICE SMITH: I have not seen any schedule of costs at all, no.
MS COLQUHAN:  My Lady, I do have a spare set.  I am extremely sorry that you did not receive it earlier.
MRS JUSTICE SMITH: I have just had exactly the same problem in the Court of Appeal this morning, which is why I am late.
MR AUBURN:  You may not need it because the application is for a detailed assessment.
MRS JUSTICE SMITH: Yes, but should there be a detailed assessment on a short case like this?  There should  really be summary assessment, should there not?
MR AUBURN:  The normal rule is for summary assessment, but there are a number of matters which we think are appropriate to refer for a detailed assessment.
MRS JUSTICE SMITH: What is the overall bill, £13,000. You see, the costs of a detailed assessment are very substantial.
MR AUBURN:  Yes.
MRS JUSTICE SMITH: What are your objections to this list?  You have had it in time to consider it.
MR AUBURN:  Yes.  We have enquired as to certain matters but we have not had answers to those ‑‑
MRS JUSTICE SMITH: What are your submissions on it?
MR AUBURN:  In relation to the hourly rate of £135, we understand that is for a grade 2.  That is an excessive amount for that grade and a lower figure would be appropriate.  In relation to ‑‑
MRS JUSTICE SMITH: What do you say is appropriate?
MR AUBURN:  £100.
MRS JUSTICE SMITH: Yes.  What else?
MR AUBURN:  That flows through the rest of the page.
MRS JUSTICE SMITH: Of course that has a knock‑on effect throughout.
MR AUBURN:  Yes. Over the page, the attendance at the hearing.  That attendance at the hearing is also listed at £130 per hour. 
MRS JUSTICE SMITH: Yes, I see.  Five hours' attendance at £130.
MR AUBURN:  Then below that the expert's fee.  This is one of the areas why we say it would be necessary for a detailed assessment.  We would say that the attendance was unnecessary.
MRS JUSTICE SMITH: Is it not better to argue that in front of me because I conducted the hearing.  I am the person who can say whether it was necessary to have an expert there, rather than a costs master.
MR AUBURN:  That may well be the case your Ladyship. The situation is that we feel there are a few points which do require clarification and we do not have that clarification.  For that reason, I am instructed to apply for a detailed assessment.
MRS JUSTICE SMITH: I do not know why you do not just ask me for a summary assessment of costs, then it would not cost you any more or anybody else any more.
     (inaudible) you say should be £100, and £130 you do not like.  What do you say the attendance on counsel should be?  I suppose you say £100, do you?
MR AUBURN:  Yes.
MRS JUSTICE SMITH: And you say it was quite unnecessary to have the expert there at all?
MR AUBURN:  In relation to the attendance at the hearing, as I understand it ‑‑ I obviously was not  counsel at the hearing ‑‑ the report was filed beforehand, and I am not aware the expert was called or whether it was necessary for him to attend the hearing.
MRS JUSTICE SMITH: Yes.
MR AUBURN:  Finally, in relation to the brief fee, counsel's fee, the figure of £5,000.  It is a difficult point to raise at this stage.  We would simply submit that is excessive for the hearing and a maximum figure for that should be £4,000.
MRS JUSTICE SMITH: Yes.  Thank you very much.
MS COLQUHAN:  Your Ladyship, I am more than willing to deal with the matter here and now.  I have to say that I do not have details and a breakdown of the expert's fees.  That is the £3,000 figure.
MRS JUSTICE SMITH: I must say I am, at the moment, minded to accept the submission that he should not have attended the hearing.  I cannot see why he needed to. I was not aware that he was here and I do not have any recollection of it being necessary for Mr Nardecchia to take any instructions from an expert.
MS COLQUHAN:  My instructions are that counsel did require the attendance of Mr Goldsmith here.  He had actually sworn a witness statement and there are various points that were actually asked of Mr Nardecchia and Mr Goldsmith could assist because of his knowledge of the matter throughout.  My  understanding is there were certain complex issues to the matter and thereby did require the attendance. I have to add, your Ladyship, that I understand also that the witness for the other side was also here, and equally any criticism ‑‑
MRS JUSTICE SMITH: Is that right?
MR AUBURN:  Your Ladyship, I am afraid I cannot answer that at this stage.
MRS JUSTICE SMITH: I am sorry, you must be able to answer it. Somebody must know whether you had an expert in attendance.
MR AUBURN:  Mr Smith was in attendance.
MRS JUSTICE SMITH: Was Mr Smith the expert?
MR AUBURN:  That is the point which I am finding it difficult to get instructions on.
MRS JUSTICE SMITH: Everybody in this case had instructed ‑‑ including counsel ‑‑ firms of consultants.  The council had instructed a firm called Donaldsons.  Do you mean Donaldsons, or do you mean the Planning Manager?
MR AUBURN:  He was the Planning Officer of the Council.
MRS JUSTICE SMITH: Mr Roger Smith.  He is in a different category altogether.
MS COLQUHAN:  But your Ladyship he was actually required to attend, and so be it that similar assistance be required of Mr Nardecchia. 
MRS JUSTICE SMITH: Entirely different matter. Roger Smith was the person who had provided all the advice to the committee and had co‑ordinated the whole affair.  The equivalent of your expert from Nathaniel Lichfield would have been a representative of the consultants firm, Donaldsons. I was unaware, and indeed I do think anybody was here from Donaldsons, and I really cannot see why you needed to have somebody from Lichfields with you.  I can accept that counsel certainly needed consultations with Lichfield and I would allow something for that.  Really what I am minded to do is simply to take a proportion of that which I think would be appropriate for attendance on counsel for consultation.
     What about the hourly rates?
MS COLQUHAN:  The indication I have been given is that £135 is a perfectly sensible figure to approach. However £100 may well be acceptable.  In relation to counsel's fees, my understanding and instructions are that there were a number of other advices that have not been set out in the schedule.  I do have a copy of a fee note to which those advices apply.
MRS JUSTICE SMITH: It includes the application for judicial review.  What call, approximately, is Mr Nardecchia?
MS COLQUHAN:  My understanding is before 76. 
MRS JUSTICE SMITH: I need not trouble you on his fees now that I have seen what it includes.
MRS JUSTICE SMITH: Anything you want to say?
     What I am minded to do is to give you a hourly rate of £110 which would include the attendance ‑‑ I am just telling you what is in my mind, I am not stopping you from saying anything further.
MR AUBURN:  Yes.
MRS JUSTICE SMITH: And that would also cover the five hours' attendance.  I would be minded to cut down Nathaniel Lichfield's recoverable fees to £1,250.  But I would leave counsel's fees as they are.  That would, of course, require recalculation.  Do you want to say anything else?
MR AUBURN:  I would simply make the point that the hourly rate of £110 flows through ‑‑
MRS JUSTICE SMITH:  Except I notice for travelling and waiting only £100 is spent.  That can stand.  Are you content? Do you want to say anything further?
MR AUBURN: No.
MRS JUSTICE SMITH: Very well.  I so order.  I would be grateful if you would carry out the calculation and agree it between you and tell the associate how much the costs order will be for.  Thank you very much.
MR AUBURN:  Your Ladyship, we do have an application in relation to appeal. 
MRS JUSTICE SMITH: Yes.
MR AUBURN:  I appreciate the difficulty obviously in asking your Ladyship to grant permission to appeal from her own decision.
MRS JUSTICE SMITH: Yes. You have to though.
MR AUBURN:  It is a relatively short point.  I would submit that your Ladyship may have fallen into error in reaching potentially inconsistent decisions on the first and third issues.  We submit that there is a tension between the Tesco Stores case and the operation of the Wednesbury test in relation to planning permission granted with reference to section 106 agreements.
MRS JUSTICE SMITH: I do not think there is a tension.
MR AUBURN:  If I can attempt to convince you otherwise ‑‑
MRS JUSTICE SMITH: Go on.
MR AUBURN:  We say that if there is a particular factor, say factor X, which must be taken into account, then it is difficult to see how a decision which is significantly based on that factor can be said to be Wednesbury unreasonable.
MRS JUSTICE SMITH: Ex hypothesi, the factor crosses the de minimis threshold, otherwise it does not get over the Tesco threshold.  The decision can still be Wednesbury unreasonable if the one factor only just  gets over the threshold, as I expressly said this one did, and if the matters on the other side of the scale are overwhelmingly strong.  It may be Wednesbury unreasonable to allow the tiny factor to carry the day.
MR AUBURN:  Yes.  I can see that.  The point we make is that this was a substantially new reason in relation to planning permission.  This was the main new factor that kicked it and it was that point that was focused on.
MRS JUSTICE SMITH: You say on the basis that there was tension between the Tesco threshold and Wednesbury unreasonable.
MR AUBURN:  Yes. There is a difficult point to raise in relation to assessing reasonableness of planning decisions where the factor relied upon is a section 106 agreement.  It is a point of public importance and it affects many planning decisions.  It is particularly raised in a case such as this, as we have said, where a section 106 agreement passes the Tesco test but only just.  That is why we say it is a particularly suitable vehicle to go to the Court of Appeal on this point.
MRS JUSTICE SMITH: Well, if the Court of Appeal thinks so they will say so.  But I shall say no.  Thank you.