Case No: CO/1134/2005
Neutral Citation Number: [2006] EWHC 223 (Admin)
IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
ADMINISTRATIVE COURT
Royal Courts of Justice
Strand, London, WC2A 2LL

Date: Monday, 20th February 2006

Before :

MR JUSTICE WALKER
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Between :

	BAYFORDBURY ESTATES LTD	Claimant	
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	(1)  FIRST SECRETARY OF STATE
(2)  EAST HERTFORDSHIRE DISTRICT COUNCIL	Defendants	

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(Transcript of the Handed Down Judgment of
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Mr David Holgate QC (instructed by Messrs Harold Benjamin) for the Claimant
Mr James Strachan (instructed by The Treasury Solicitor) for the First Defendant
Ms Lisa Busch (instructed by The Solicitor, East Hertfordshire District Council) for the Second Defendant

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Judgment
Table of contents:
Introduction	3	
The main issue at the Inquiry	4	
Witness evidence at the Inquiry	4	
Procedure at the conclusion of the Inquiry	5	
Evidence filed by the Inspector	5	
The Development Plans and Government Planning Guidance	6	
Planning Guidance on Employment Land and Housing	6	
The Development Plan	9	
Policies on Employment Land and Housing at County level	9	
Policies on Employment Land and Housing at District level	13	
History of the planning application	16	
Legislative framework and legal principles	17	
Legislative Framework	18	
Principles of Law	19	
Introductory submissions of the claimant	22	
The claimant’s application to amend	28	
Introductory submissions for the defendants	30	
Ground 1: SP Policy 14	34	
Ground 1: submissions for the claimant	34	
Ground 1: submissions for the defendants	39	
Ground 1: the claimant’s reply	45	
Ground 1: analysis	45	
Ground 2: Prematurity	51	
Ground 2: the claimant’s submissions	51	
Ground 2: the defendants’ submissions	56	
Ground 2: the claimant’s reply	57	
Ground 2: Analysis	59	
Ground 3: Paragraph 42 of PPG3	60	
Ground 3: the claimant’s submissions	60	
Ground 3: the defendants’ submissions	68	
Ground 3: the claimant’s reply	70	
Ground 3: Analysis	71	
Ground 4: The Employment Land Study	73	
Ground 4: the claimant’s submissions	73	
Ground 4: the defendants’ submissions	84	
Ground 4: the claimant’s reply	85	
Ground 4: Analysis	85	
Ground 5: The Viability Study	87	
Ground 5: the claimant’s submissions	87	
Ground 5: the defendants’ submissions	97	
Ground 5: the claimant’s reply	99	
Ground 5: analysis	99	
Ground 6: Prospect of Office Development	100	
Ground 6: the claimant’s submissions	100	
Ground 6: the defendants’ submissions	102	
Ground 6: analysis	103	
Ground 7: Affordable Housing	104	
Ground 7: the claimant’s submissions	104	
Ground 7: the defendants’ submissions	107	
Ground 7: the claimant’s reply	107	
Ground 7: Analysis	107	
Conclusion	108	

Mr Justice Walker : 

Introduction

1.	The Victoria Maltings were located in Broadmeads, within the central part of Ware, immediately to the south of the River Lea. They were destroyed by fire in 1988. The second defendant (“the Council”), which is the local planning authority, designated the whole of the Maltings site as an “employment area”. Consistently with this, part of the Maltings site is now taken up by modern buildings comprising an industrial unit and offices. The remainder (“the Appeal Site”) is owned by the claimant, which wishes to use the Appeal Site for a residential development of 89 flats. It submitted a planning application (“the Revised Application”) to the Council on 14 January 2004. The Council failed to decide on the application within the prescribed period and accordingly the claimant appealed to the first defendant under section 78 of the Town and Country Planning Act 1990 (“the 1990 Act”). The Inspector appointed by the first defendant held an Inquiry on 30 November to 1 December 2004 and a site visit on 2 December 2004. On 13 January 2005 he issued a decision letter (referred to below as “the Decision Letter” or “DL”) dismissing the appeal. The claimant now brings proceedings in this court under section 288 of the 1990 Act, asserting that the decision of the Inspector (“the Appeal Decision”) is not within the powers of the Act, and that in the Decision Letter the Inspector failed to comply with the duty in Rule 19(1) of the Town and Country Planning Appeals (Determination by Inspectors) (Inquiries Procedure) (England) Rules 2000 to give reasons for his decision.

2.	In its particulars of claim the claimant identified seven grounds of challenge. The claimant has also sought permission to rely on a proposed additional ground. Before turning to the grounds of challenge and the proposed additional ground, I set out some background material. 

The main issue at the Inquiry

3.	At paragraph 4 of the Decision Letter the Inspector identified what he described as the main issue in the case. This had two elements. The first was, “whether the proposed development is an appropriate use for this employment land, having regard to local planning policies.” If the claimant had succeeded on that element, then it would have succeeded on the appeal. 

4.	However, if the claimant had not succeeded on the first element, the Inspector identified a second element. This was whether there was an overriding need for the release of the land for housing purposes. Although the Inspector did not say so expressly, it is common ground that if the claimant had succeeded on that element then it would have succeeded on the appeal.
Witness evidence at the Inquiry

5.	The claimant as appellant tendered written and oral evidence from Mr Richard Parsons, Associate Director in the practice of Vincent and Gorbing, Chartered Architects and Town Planners.

6.	The Council as respondent tendered written and oral evidence from Mr Harvey Fairbrass, the Council’s Development Control Manager, Mr Bryan Thomsett, the Council’s Head of Environment Planning, Ms Cristina Howick a partner of Roger Tym & Partners (“RTP”), a firm of consultant planners and economists, and Ms Ann Marie Hulatt of King Sturge, Property Consultants.

Procedure at the conclusion of the Inquiry

7.	At the Inquiry, and in the proceedings before me, the claimant was represented by Mr David Holgate QC and the Council was represented by Ms Lisa Busch of counsel. In addition to hearing evidence from each side, the Inspector also had the benefit of written and oral closing submissions from Ms Busch on behalf of the Council as respondent to the appeal and from Mr Holgate on behalf of the claimant as appellant. The document containing Mr Holgate’s written closing submissions was updated the following day to include submissions made orally, and the updated version was sent to the Inspector. I shall refer to the updated document as “the Appellant’s Updated Closing” and to Ms Busch’s written closing submissions as “the Respondent’s Written Closing”.

Evidence filed by the Inspector

8.	Unusually, in the present case a witness statement from the Inspector was filed by the first defendant. Mr Strachan, who appeared on behalf of the first defendant, acknowledged that in First Secretary of State v Hammersmatch Properties Limited [2005] EWCA Civ 1360 Pill LJ said that a decision letter should generally stand, or fall, on its own wording. In the present case, however, Mr Strachan said that the Inspector was dealing with matters of fact as to what material was before the Inspector, and as to submissions that had been made to the Inspector – much of which had been omitted from the material lodged by the claimant. The response from Mr Holgate was that passages in the witness statement giving reasons additional to or inconsistent with those in the Decision Letter were not permissible in law and therefore could not be relied upon by the first defendant, and that by contrast it was open to the claimant to rely upon defects in the Inspector’s reasoning revealed by the witness statement. In the event, as will be seen below, the question whether or not reference can be made to the Inspector’s witness statement has not been determinative of the view that I have reached. In those circumstances I say no more about that question.

The Development Plans and Government Planning Guidance

9.	At the Inquiry much time was spent considering relevant development plans along with government guidance concerning employment land and the circumstances in which it might be appropriate to use it for residential purposes. There have been actual or proposed changes in approach in recent years both in central government guidance and in the development plans relevant to Hertfordshire in general and East Hertfordshire in particular. 

Planning Guidance on Employment Land and Housing

10.	The first respondent is responsible for central government planning guidance. This included Planning Policy Guidance Note 3: Housing (“PPG3”). A material passage in PPG3 is paragraph 42:

“Reallocating Employment and Other Land to Housing

42. Some local planning authorities have allocations of land for employment and other uses which cannot realistically be taken up in the quantities envisaged over the lifetime of the development plan. Equally, since planning policies may have changed since some of this land was designated for particular land uses, it is possible that the designation is no longer compatible with policy set out in current PPGs. The Government regards this as a wasted resource, especially where such sites include previously-developed land. Local planning authorities should therefore review all their non-housing allocations when reviewing their development plan and consider whether some of this land might better be used for housing or mixed use developments." 

11.	At the time of the Inquiry a supplement to this part of PPG3 was under consideration. The Inspector dealt with this in paragraph 13 of the Decision Letter, in a passage which no party challenges. It was as follows: 

“13. There is also a proposed new paragraph to follow para 42 in PPG3, which proposes that employment land should be considered favourably for housing unless there is a realistic prospect of the allocation being taken up during the Plan period or that its development for housing would undermine regional and local strategies for economic development and regeneration. This additional guidance is a material consideration, but as it is only in a draft consultation form I can give it little weight in this Decision.

12.	Relevant guidance also included paragraphs 47 to 49 of Planning Policy Guidance Note 1: General Policy and Principles (“PPG1”):

“47. Questions of prematurity may arise where a development plan is in preparation or under review, and proposals have been issued for consultation, but the plan has not yet been adopted or approved. In some circumstances, it may be justifiable to refuse planning permission on grounds of prematurity. This may be appropriate in respect of development proposals which are individually so substantial, or whose cumulative effect would be so significant, that to grant permission would prejudice the outcome of the plan process by predetermining decisions about the scale, location or phasing of new development which ought properly to be taken in the development plan context. A proposal for development which has an impact on only a small area would rarely come into this category; but a refusal might be justifiable where a proposal would have a significant impact on an important settlement, or a substantial area, with an identifiable character. Where there is a phasing policy in the development plan, it may be necessary to refuse planning permission on grounds of prematurity if the policy is to have effect.

48. Other than in the circumstances described above, refusal of planning permission on grounds of prematurity will not usually be justified. Planning applications should continue to be considered in the light of current policies. However, account can also be taken of policies in emerging development plans which are going through the statutory procedures towards adoption (or approval). The weight to be attached to such policies depends upon the stage of plan preparation or review, increasing as successive stages are reached.

For example:

•	Where a plan is at the consultation stage, with no early prospect of reaching deposit, then a refusal on prematurity grounds would seldom be justified because of the lengthy delay which this would impose in determining the future use of the land in question.

•	Where a plan has been deposited but no objections have been lodged to relevant policies, then considerable weight may be attached to those policies because of the strong possibility that they will be adopted (or approved) and replace those in the existing plan. The converse may apply if there have been objections to relevant politicise. However, much will depend on the nature of those objections and also whether there are representations in support of particular policies;

•	Where an Inspector has recommended in favour of relevant policies to which objection has been raised, refusal on prematurity grounds is unlikely to be justified for an application which is consistent with these policies.

49. Where planning permission is refused on grounds of prematurity, the planning authority will need to indicate clearly how the grant of permission for the development concerned would prejudice the outcome of the development plan process.”

The Development Plan

13.	The relevant Development Plan comprises the Hertfordshire County Structure Plan 1991-2011, adopted in April 1998 (“the SP”) and the East Hertfordshire Local Plan First Review, adopted in 1993 with alterations adopted in December 1999 (“the LP”). 

Policies on Employment Land and Housing at County level

14.	Prior to the SP, the previous county structure plan had included a Policy 73 in these terms:

“7.6.24 In order to concentrate employment activities on to existing sites and make full use of existing employment land and premises as identified in District Local Plans:

“POLICY NUMBER 73

EMPLOYMENT AREAS MAY BE DEFINED IN DISTRICT LOCAL PLANS. WITHIN SUCH AREAS PRIORITY WILL BE GIVEN TO INDUSTRIAL DEVELOPMENT BUT OTHER EMPLOYMENT USES MAY ALSO BE IDENTIFIED. DEVELOPMENT AND REDEVELOPMENT OF SITES ALREADY INDENTIFIED IN DISTRICT LOCAL PLANS WILL BE ENCOURAGED. PROPOSALS FOR THE DEVELOPMENT OR REDEVELOPMENT OF OTHER LAND AND PREMISES FOR EMPLOYMENT USES MAY BE PERMITTED WHERE THESE PROPOSALS ARE ACCEPTABLE IN TERMS OF THE OTHER POLICIES OF THIS PLAN AND IN ENVIRONMENTAL TERMS OR WHERE SUCH DEVELOPMENT IS IN THE NATIONAL OR REGIONAL INTEREST”

15.	The SP dealt with employment land much more extensively than its predecessor. It is necessary to set out substantial material from the paragraphs in the SP which led up to Policy 14 – Development for Employment Needs (“Policy 14”):

“240.  Taking into account all the relevant considerations, the County Council believes that there is already more than sufficient land and floorspace currently in employment use, together with the Key Employment Sites and other allocated employment land, to enable:

•	Full employment, coupled with a modest reduction in net out-commuting, and therefore a higher proportion of the resident workforce employed within the County;

•	Economic growth of the kinds being promoted through the County Economic Development Strategy.

241.  Therefore the Structure Plan does not make provision for further land allocations for employment development on quantitative grounds. 

242.  The basic premise of Policy 14 is to set a positive approach to providing for changing business and employment needs. It therefore provides a criteria-based approach against which proposals for employment development are to be considered. The policy enables new land allocations to be considered only in exceptional circumstances, taking account of qualitative considerations including the aim to achieve a more sustainable pattern of development, e.g. through mixed land use.

243.  Policy 14 reflects the county Economic Development Strategy, the Bright Green Industrial Strategy and Planning Policy Guidance Note 4 on ‘Industrial and Commercial Development and Small Firms.’ It recognises the need for a balanced supply of employment floorspace and an economy based on environmental sustainability, emphasising quality of life and looking beyond mass production. Many of the other policies of the Structure Plan also support this approach.

244.  The development of ‘Key Employment Sites’ is recognised as being particularly important in securing sustainable economic growth and in meeting the needs of national and international companies at the forefront of the ‘knowledge economy’. Key Employment Sites are listed in Policy 15.

Release of Existing Employment Land and Floorspace for Other Uses

245.  The total stock of office, industrial and warehousing floorspace (i.e. that falling in B1-B8 use classes) in Hertfordshire in 1997 was estimated to be approximately 7,960,000 square metres. A vacancy rate of about 5% is reasonable to allow for normal stock turnover in the context of a vigorous local economy. On this basis, at least 400,000 square metres of floorspace would have been vacant during 1997.

246.  Figure 16 illustrates changes in business, industrial and office floorspace on the market since 1988. (Floorspace on the market at any one time is a proxy measure for vacant floorspace and the sum of these marketing categories equates to the sum of B1 to B8 uses.) It shows the decline in vacant floorspace since 1993, which has been closely correlated with strong economic growth and a corresponding increase in employment during this period. About 953,000 squares metres of B1 to B8 floorspace were estimated to be vacant in December 1997. This indicates a persisting large surplus of existing floorspace, over and above that needed to allow for normal stock turnover, at a time when unemployment is very low.

247.  In addition to the over-supply of vacant existing floorspace, Hertfordshire has a considerable capacity of planning permissions which are yet to be implemented together with other land which is identified in local plans for employment development. In 1997, the sum of additional B1 to B8 floorspace commitments ‘in the pipeline’ in Hertfordshire was estimated to be approximately 1,600,000 square metres.

248.  It remains to be seen whether and at what rate the overall over-supply of B1 to B8 floorspace will be taken up as a consequence of forecast growth in employment. Although in the longer term the overall balance of supply and demand for employment land and floorspace is far from certain, it seems reasonable to proceed on the assumption of a surplus and therefore that some land and buildings either currently in employment uses or allocated for these may be released for other uses. A discriminating approach will be undertaken to enable district councils to reach judgements about what types and quantities of existing employment provision will no longer be required for employment purposes and so may be released for other needs. Qualitative as well as quantitative issues will need to be taken into consideration.

249.  Particular priority is to be given to identifying suitable opportunities to provide more dwellings on appropriate sites as part of planned regeneration. This will include housing as part of mixed redevelopment schemes. The Panel which held the Examination in Public in 1997 concluded that, in the period 1995 to 2011, it should be possible to provided at least 3,800 swellings through the redevelopment and reuse of surplus employment land and buildings which are yet to be identified. This figure is in addition to new homes already built on former employment land in the period 1991 to 95 and dwelling commitments on existing employment land which had already been identified in 1995. The significant contribution which surplus employment land and buildings are expected to make in achieving the overall dwelling requirement of 65,000 has been taken into account in the district dwelling distribution in Policy 9.”

16.	Policy 14 was then set out in the SP in these terms:

“POLICY 14 DEVELOPMENT FOR EMPLOYMENT NEEDS

…

Development will take place mainly in areas allocated for such purposes in local plans, and key employment sites and existing prime employment areas will be identified in them where employment development will be promoted. Exceptionally, new land allocations may be identified for such purposes.

In considering development proposals regard should be had to the following criteria and their expression in local plans: 

(i)	the need to ensure an adequate and balanced supply of employment floorspace, based on joint monitoring and periodic forecasting by the County and District Councils of trend in:

a)	The overall stock of floorspace (including reductions due to the reuse of employment land and buildings for other purposes, notably dwelling provision as part of planned regeneration);

b)	The levels of vacant floorspace and any derelict land formerly used for employment;

c)	The supply of permissions and land allocations still to be realised.

(ii)	assessments of the implications of local and regional economic restructuring, and emerging technological developments particularly for employment densities and operational requirements;

(iii)	assessments of the balance between employment opportunities and the labour market in particular areas;

(iv)	regional, county-wide and local economic development strategies;

(v)	the special advantages and opportunities in encouraging particular types of business development at Key Employment Sites, and in designating other specific locations for them, especially to promote the knowledge economy;

(vi)	the needs of local people and businesses as identified in any comprehensive settlement appraisals;

(vii)	the desirability of encouraging small scale employment development to achieve an appropriate mix of uses in urban areas;

(viii)	the aims of securing planned regeneration, particularly the need to protect sites best suited to housing or mixed use.

Existing employment land and buildings may be identified in local plans as part of a planned regeneration package for an area, to be re-used for either new employment provision, housing or mixed use.  Such proposals must be acceptable in terms of other policies.  In so far as re-use for employment purposes is proposed, regard should be given to the criteria above.  Only types and quantities of existing employment provision which are no longer required to meet future employment requirements and business and community needs may be re-used for other purposes, notably dwelling provision on appropriate sites as part of planned regeneration.” 

17.	The County Council published deposit draft Structure Plan Alterations 2001-2016 in March 2003, but this project was subsequently placed on hold and its progress brought to an end as a result of changes to the plan-making process implemented by the Planning and Compulsory Purchase Act 2004. Consequently, the parties agreed that limited weight could be attached to the draft Structure Plan Alterations. 

Policies on Employment Land and Housing at District level

18.	Although the LP had an end date of 2001, it was common ground that in the absence of a replacement it remained part of the Development Plan.

19.	The LP contained Policy EMP2 – Employment Land (“Policy EMP2”) in these terms:

“In Part II of this plan (Settlement Planning) the District Council:

(I)		Has identified employment areas which are primarily reserved for industry, comprising Classes B1 Business and B2 General Industrial Uses; and, where well related to the transport network, Class B8 Storage or Distribution Uses.

(II)	Will, within employment areas, normally give favourable consideration to employment development as specified in (I) above, and resist other inappropriate proposals.”

20.	Paragraphs 5.3.1 to 5.3.8 of the LP explained that the defined employment areas were those which the Council considered should be primarily reserved for business, industry and where appropriate, storage and distribution uses and where priority would be given to such uses.

21.	The LP also contained Policy WARE 3 – Employment Land (“Policy WARE 3”) which included the following:

“IN ACCORDANCE WITH POLICY EMP2, THE FOLLOWING SITES ARE DEFINED AS EMPLOYMENT AREAS ON THE PROPOSALS MAP AND WILL BE PRIMARILY RESERVED FOR INDUSTRY COMPRISING CLASSES B1 AND B2 GENERAL INDUSTRIAL USES.

…

(II)	BROADMEADS

…”

22.	In that regard paragraphs 12.5.1 and 12.5.2 of the LP stated:

“12.5.1	Ware’s industrial land is mainly confined to the central area of the town close to the river and the railway.  It comprises one large mixed use industrial site, Marsh Lane, and three other smaller sites in addition to the area occupied by the town’s major employer, Glaxo, off Park Road and Harris Lane.

12.5.2	In recent years a considerable number of former industrial sites have been converted or redeveloped for residential purposes.  Whilst the possibility of further similar developments is not ruled out, the District Council considers it important to identify and defend the key remaining employment centres in the town.”

23.	Although the document in which these policies are found is dated December 1999, it was common ground that on matters relevant to the Inquiry the SP had not been taken into account.

24.	The LP was under review at the time of the Inquiry. A Deposit Draft Second Review Plan had been published in December 2000. At the time of the Inquiry the emerging local plan (“ELP”) was to be found in the Second Review Re-Deposit version of the East Hertfordshire Local Plan (November 2004). 

25.	The ELP contained Policy EDE 1 – Employment Areas (“Policy EDE 1”) in these terms:

“The District Council has identified Employment Areas which are primarily reserved for industry, comprising Use Classes B1 (Business), B2 (General Industrial); and, where well related to the transport network, Class B8 (Storage or Distribution).  These Employment Areas are listed in Part II of this Plan (Settlement Planning).”

26.	In this regard the first part of paragraph 6.4.2 of the ELP was unchanged from December 2000 and stated:

“6.4.2	The Structure Plan has concluded that there is sufficient land and floorspace currently in employment use, together with the Key Employment Sites and other allocated employment land, such that no new land allocations are required.  The Structure Plan directs such development to existing allocated employments areas, which are to be identified in local plans.”

27.	The second part of paragraph 6.4.2 was modified in the ELP to read:

“The East Hertfordshire Employment Land Study 2004 identifies a long term requirement for office floorspace and this will be addressed as part of the future Local Development Framework. The Study recommended that the Council safeguard existing Employment Areas to meet demand for industrial and warehousing uses. The Study also identified a shortfall of supply of industrial and warehousing sites in Bishop’s Stortford and this will also be addressed as part of the future Local Development Framework.”

28.	The ELP also contained Policy WA8 – Employment Areas (Ware) (“Policy WA 8”) which included the following:

“WA8 (Amended Existing Policy Ware 3) Employment Areas

In accordance with Policy EDE1 the following sites are defined as Employment Areas on the proposals map and will be primarily reserved for industry comprising Classes B1 and B2 General Industrial Uses:

…

(II)  Broadmeads

…”

29.	As to this, paragraph 13.5.4 of the ELP said

“The Council considers that, in order to maintain a supply of employment land, the Park Road/Harris Lane (GlaxoSmithKline); Marsh Lane; Broadmeads; and Widbury Hill Areas should continue to be primarily reserved for such purposes.”

History of the planning application

30.	In 2003 Council officials advised the claimant that the Appeal Site was allocated for employment purposes in the LP, that the December 2000 Deposit Draft continued that allocation, and that accordingly residential development would be contrary to the provisions of the Development Plan and any proposal for such development would be unlikely to succeed. However officials also advised that the Council would be “prepared to consider a meaningful proposal for mixed development of the site, with at least 50% of the site and its floorspace being devoted to employment uses”.

31.	Three applications for planning permission were lodged in August 2003. None was successful. The Revised Application took into account some but not all of the objections to those applications. Following receipt of the Revised Application the Council commissioned an Employment Land Study (“ELS”), prompted by the proposed changes to paragraph 42 of PPG3. 

32.	On 14 September 2004 the ELS was reported to and adopted by the Council’s Executive. In the meantime, the claimant lodged its appeal against the Council’s non-determination of the Revised Application under section 78 of the 1990 Act. A report on the Revised Application was then presented to the Committee on 10 November 2004. That Report recommended that, if the Committee had been in a position to determine the Planning Application it should have refused it for three reasons:

“1. The proposal would be contrary to the adopted East Herts Local Plan wherein the site is allocated for employment purposes in accordance with policies EMP2 and WARE3. 

2. The proposal would result in the loss of space available for employment purposes in Ware, contrary to policies EMP2 and WARE3 of the East Herts Local Plan. 

3. There is no overriding requirement for the release of non-housing allocated land for housing purposes in relation to the existing supplies of housing land within East Herts”. 

33.	The Committee accepted this recommendation on 5 November 2003. 

Legislative framework and legal principles

34.	The skeleton argument prepared by Ms Busch on behalf of the Council contained a helpful account of the legislative framework and relevant legal principles. The claimant and the first defendant both accepted this account, and accordingly I reproduce it here. 

Legislative Framework

35.	By section 57(1) of the 1990 Act, planning permission is required for the carrying out of any development of land. “Development” is defined in section 55(1) of that Act as meaning, among other things, the carrying out of building operations in, on, over or under land. 

36.	Section 70(1) of the 1990 Act provides (so far as relevant) that where an application is made to a local planning authority for planning permission, it may grant permission either unconditionally or subject to such conditions as it thinks fit; or it may refuse planning permission. Section 70(2) provides that in dealing with such an application the authority shall have regard to the provisions of the development plan, so far as material to the application, and to any other material considerations. 

37.	Section 54A of the 1990 Act provides that where, in making any determination under the planning Acts (including, by section 336(1), the 1990 Act), regard is to be had to the development plan, and the determination shall be made in accordance with the plan unless material considerations indicate otherwise. 

38.	By section 78(2)(a) of the 1990 Act, a person who has made a planning application has a right of appeal to the Secretary of State if the local planning authority have failed to give him notice of their decision on the application within such period as may be described by the development order or within such extended period as may at any time be agreed upon in writing between the applicant and the authority. 

39.	By section 288(1)(b) of the 1990 Act, if any person is aggrieved by any action on the part of the Secretary of State to which section 288 applies and wishes to question the validity of that action, on the grounds that the action is not within the powers of the 1990 Act or that any of the relevant requirements have not been complied with in relation to that action, he may make an application to the High Court under section 288. 

40.	By section 288(4), section 288 applies, inter alia, to any such action on the part of the Secretary of State as in mentioned in section 284(3) of the 1990 Act, including any decision on an appeal under section 78. 

41.	By section 288(5) (so far as relevant), on any application under section 288, the High Court, if satisfied that the action in question is not within the powers of the 1990 Act, or that the interests of the applicant have been substantially prejudiced by a failure to comply with any of the relevant requirements in relation to it, may quash that action. 

42.	Rule 19(1) of the Town and Country Planning Appeals (Determination by Inspectors) (Inquiries Procedure) (England) Rules 2000 requires Inspectors to give reasons for their decisions on planning applications. 

Principles of Law

43.	A challenge to a decision of an Inspector on a planning application made by way of an application under section 288 of the 1990 Act on the basis that decision was not “within the powers of the Act” may be made on standard public law grounds, including the grounds that the Inspector’s conclusion was perverse, that he failed to take account of relevant considerations or took account of irrelevant ones, and that he failed to give reasons which were proper and adequate, and/or clear and intelligible, and/or which dealt with the substantial points which had been raised in a preceding Inquiry (Seddon Properties v Secretary of State for the Environment [1978] JPL 835 per Forbes J; cited  in Bolton MBC v Secretary of State for the Environment [1991] JPL 241 (CA)). 

44.	The interpretation of policy is a matter for the decision-maker; and, where the interpretation is one that the policy is reasonably capable of bearing, there is no basis for intervention by the Court (R v Derbyshire CC ex parte Woods [1997] JPL 958). 

45.	The decision-maker is not required to refer to every material consideration, only the main issues in dispute. The scope for drawing an inference that the decision-maker has not fully understood the materiality of a matter to the decision is limited to the main issues, and then only when the other known facts and circumstances appear to point overwhelmingly to a different decision (Bolton MBC v Secretary of State for the Environment (1995) 71 P&CR 309 per Lord Lloyd at 314-315). 

46.	The weight to be attached to material considerations and matters of planning judgment are within the exclusive jurisdiction of the Inspector (Tesco Stores Ltd v Secretary of State [1995] 1 WLR 759).

47.	An Inspector is not writing an examination paper. His decision letter must be read in good faith and references to policies must be taken in the context of the general thrust of the Inspector’s reasoning. The adequacy of reasons must be assessed by reference to whether the decision leaves room for genuine doubt as to what the decision-maker has decided and why, on a straight-forward, down-to-earth reading of the decision, without excessive legalism or exegetical sophistication (South Somerset DC v Secretary of State for the Environment [1993] 1 PLR 80 at 83E-G and Clarke Homes Ltd v Secretary of State for the Environment (1993) 66 P&CR 263 at 271-271). 

48.	In South Buckinghamshire District Council v Porter [2004] 1 WLR 1953 Lord Brown of Eaton-under-Heywood, with whose opinion the other members of the House agreed, dealt with the requirement to give reasons. He set out a helpful summary of the law at paragraph 36 of his opinion (see [2004] 1 WLR 1953, at 1964), as follows:

“The reasons for a decision must be intelligible and they must be adequate. They must enable the reader to understand why the matter was decided as it was and what conclusions were reached on the ‘principal important controversial issues’, disclosing how any issue of law or fact was resolved. Reasons can be briefly stated, the degree of particularity required depending entirely on the nature of the issues falling for decision. The reasoning must not give rise to a substantial doubt as to whether the decision-maker erred in law, for example, by misunderstanding some relevant policy or some other important matter or by failing to reach a rational decision on relevant grounds. But such adverse inference will not readily be drawn. The reasons need refer only to the main issues in the dispute, not to every material consideration. They should enable disappointed developers to assess their prospects of obtaining some alternative development permission, or, as the case may be, their unsuccessful opponents to understand how the policy or approach underlying the grant of permission may impact upon future such applications. Decision letters must be read in a straightforward manner, recognising that they are addressed to parties well aware of the issues involved and the arguments advanced. A reasons challenge will only succeed if the party aggrieved can satisfy the court that he has genuinely been substantially prejudiced by the failure to provide an adequately reasoned decision”. 

49.	The Court has a discretion as to whether or not to quash an Inspector’s decision, even if an error of approach is identified, and, if the Inspector would have reached the same conclusion in any event, the decision should stand (Simplex Holdings v Secretary of State for the Environment [1998] 3 PLR 25). 

Introductory submissions of the claimant

50.	Mr Holgate submitted that the principles in relation to the giving of reasons included that the Inspector must grapple with each main issue, and that the parties must be able to see how the issues were resolved. The parties might be prejudiced, for example, if the Decision Letter gives rise to doubt as to whether a relevant consideration has been taken into account. He referred me in that regard to the South Buckinghamshire case (see paragraph 48 above) at paragraphs 24 onwards, and especially to the discussion in paragraphs 30 and 31 of the observations by Lord Bridge of Harwich in Save Britain’s Heritage v Number 1 Poultry Ltd [1991] 1 WLR 153:

30 As to the circumstances in which a deficiency of reasons would cause substantial prejudice, Lord Bridge said, at p 167: 	

	"... I should expect that normally such prejudice will arise from one of three causes. First, there will be substantial prejudice to a developer whose application for permission has been refused or to an opponent of development when permission has been granted where the reasons for the decision are so inadequately or obscurely expressed as to raise a substantial doubt whether the decision was taken within the powers of the Act. Secondly, a developer whose application for permission is refused may be substantially prejudiced where the planning considerations on which the decision is based are not explained sufficiently clearly to enable him reasonably to assess the prospects of succeeding in an application for some alternative form of development. Thirdly, an opponent of development, whether the local planning authority or some unofficial body like Save, may be substantially prejudiced by a decision to grant permission in which the planning considerations on which the decision is based, particularly if they relate to planning policy, are not explained sufficiently clearly to indicate what, if any, impact they may have in relation to the decision of future applications." 	

31 The first of those three possible causes of substantial prejudice-the developer's (or, as the case may be, his opponent's) uncertainty, through the inadequacy of the reasons, whether or not the decision is properly open to a vires challenge-Lord Bridge elaborated, at p 168: 	

"If it was necessary to the decision to resolve an issue of law and the reasons do not disclose how the issue was resolved, that will suffice. If the decision depended on a disputed issue of fact and the reasons do not show how that issue was decided, that may suffice. But in the absence of any such defined issue of law or fact left unresolved and when the decision was essentially an exercise of discretion, I think that it is for the applicant to satisfy the court that the lacuna in the stated reasons is such as to raise a substantial doubt as to whether the decision was based on relevant grounds and was otherwise free from any flaw in the decision-making process which would afford a ground for quashing the decision." 

51.	Following on from this, in paragraph 33 Lord Brown noted that in Clarke Homes Ltd v Secretary of State for the Environment (1993) 66 P & CR 263 Sir Thomas Bingham MR felicitously observed, at pp 271-272:

"I hope I am not over-simplifying unduly by suggesting that the central issue in this case is whether the decision of the Secretary of State leaves room for genuine as opposed to forensic doubt as to what he has decided and why. This is an issue to be resolved as the parties agree on a straightforward down-to-earth reading of his decision letter without excessive legalism or exegetical sophistication." 

52.	As to the factual context, Mr Holgate drew my attention to the Council’s letter of 22 October 2003, stating that the Council would be sympathetic to mixed use development on a 50/50 basis. This was also regarded as acceptable in the ELS: see paragraph 6.39 at B1/234. An additional point on the factual context was that the argument at the Inquiry had been as to whether the Appeal Site should be retained for category B1 use, that is use for offices and light industry.

53.	Mr Holgate accepted that where a witness agreed with counsel on a particular point, that agreement was not binding on the Inspector. However, if the Inspector was proposing to depart from a substantial point on which the witness had agreed with counsel, then the Inspector must give reasons for this departure. He accepted that whether the matter was substantial or not was a matter for this court.

54.	As to the Inspector’s witness statement, Mr Holgate accepted that it would be permissible, for example, to exhibit documents before the Inquiry. However, the making of such a statement gave rise to a danger that the Inspector would seek to interpret the Decision Letter, or supplement the reasons given in that letter. On occasion, submitted Mr Holgate, that had happened in this case. Mr Holgate drew my attention to Rumsey v Secretary of State for the Environment Transport and Regions (2001) P&CR 465, at page 472. Mr Duncan Ouseley QC, sitting as a Deputy High Court Judge, in that case ignored a particular paragraph in the Inspector’s witness statement. He said:

“It is wrong in my judgment for witness statements to be used to supplement or clarify the reasoning in a decision letter. I appreciate that the purpose of the statement was the legitimate one of explaining what material was before the Inspector and in this context, a hard and fast distinction between explaining that and avoiding any elaboration of reasoning may be difficult to draw. But in so far as that material could be used to supplement or clarify the reasoning in a decision letter, it should be ignored.”

55.	Turning to the law on development plans, Mr Holgate identified two corner stones found in the 1990 Act. The first was section 70(2), under which the development plan is a mandatory relevant consideration. The second was section 54A (applicable to the present case under transitional provisions) under which the Appeal Decision was required to be made in accordance with the plan unless material considerations indicated otherwise. 

56.	Mr Holgate added that while under sections 36 and 43 a Local Plan is required to be in conformity with the structure plan, the first defendant’s planning policy guidance notes, in Guidance note number 1 dealing with general policy and principles (“PPG1”) recognised in paragraphs 39 to 46 that plans would be kept under review. Account could be taken of policies in emerging development plans, but the weight to be attached to them depended upon the stage of plan preparation. There was a danger that highly detailed policy which provided no flexibility could become outdated very quickly. It was important that sites in existing plans be reviewed as part of a process of keeping the plan up to date. Those which were no longer considered appropriate for their existing or proposed use should be reallocated to other, more realistic uses. 

57.	In the present case by the time of the application the LP was out of date, but Mr Holgate nevertheless accepted that it remained the valid local plan for the purposes of the Inquiry. 

58.	Mr Holgate then turned to what had been common ground at the Inquiry. The particulars of claim, and his skeleton argument, had asserted that five matters concerning the development plan had been common ground. The first four of these were described in this way:

(i)	The local plan had been prepared so as to conform to an earlier version of the Structure Plan (the County Structure Plan 1986 Review) which no longer formed part of the statutory development plan, having been replaced by the Structure Plan adopted in 1998 (DL11);

(ii)	The policies in both the 1986 Review Structure Plan and the currently adopted local plan were prepared for a period expiring in 2001 (DL11 and para. 5.1 on p. 317);

(iii)	On 30 April 1998 the County Council adopted the Structure Plan Review covering the period 1991-2011. On 17 July 1988 and 18 August 1999 (pp. 132-6) it issued a statement under the 1990 Act stating that the local plan was in conformity with the new Structure Plan subject to two important qualifications, firstly that the local plan did not cover development needs between 2001 and 2011 and secondly that the local plan should be the subject of an early review so as to produce a further local plan in accordance with the 1991-2011 Structure Plan (see para. 3.7 on p. 313);

(iv)	An "early review" of the local plan had not taken place (para. 3.7 on p. 313);

59.	A fifth matter was said in paragraph 3.2(v) of the particulars of claim to have been common ground. This was that “very little weight could be given to the adopted local plan.” Having reflected upon the matter in the light of the points made by the Council, Mr Holgate accepted that what had been common ground was that the LP should have “limited weight”. I shall return to this point when I discuss the proposed amendment to the particulars of claim.

60.	As to the status of the ELP, Mr Holgate’s skeleton argument said this:

The Council accepted at the inquiry that a first deposit draft of the Second Review of the Local Plan had been published in December 2000 attracting 10,000 objections and that a second deposit draft had been authorised by the Council in November 2004 for public consultation. In a letter dated 13 July 2004 (pp. 180-2) the Government Office of the Eastern Region had expressed strong concerns about the delay in the progression of the second review of the local plan. Consequently, in July 2004 the Council agreed to a "challenging" procedure intended to achieve adoption by March 2007 (pp. 260-269). In the circumstances, the Council agreed at the inquiry that very little weight should be attached to the second deposit draft of the local plan.

61.	In oral submissions, however, Mr Holgate accepted that the last sentence quoted above put the matter too high: the Council had conceded no more than that the weight to be given to the ELP was “limited”.

62.	Other general points made by Mr Holgate were that under the previous structure plan, Policy 73 had involved a very low threshold for the designation of land for employment purposes. It had made no reference to modern policies, recognised in criterion (viii) of Policy 14 that areas which are no longer needed for industry should be used for houses (see paragraph 16 above). Also in the current SP, paragraph 249 (quoted at paragraph 15 above) assumed a surplus of employment land and gave priority to identifying suitable opportunities to provide more dwellings on appropriate sites as part of planned regeneration. Paragraph 250 envisaged mixed use. The Structure Plan did not suggest that employment land should only be released for housing purposes through a review of the local plan. Returning to the specific wording of Policy 14, it included the following sentence:

“Development will take place mainly in areas allocated for such purposes in local plans, and key employment sites and existing prime employment areas will be identified in them where employment development will be promoted.”

63.	Taken as a whole, said Mr Holgate, this sentence indicated a policy that employment uses should be confined to key employment sites and existing prime employment areas. If that went too far, then it was certainly the case that Policy 14 was no longer accepting a broad brush general approach. 

64.	So far as the Appeal Site was concerned, it had been classified in the LP by reference to the now obsolete Policy 73. Mr Holgate submitted that in consequence its current status was “in limbo.” The highest way in which the Council’s case could be put was that the site would be an existing prime employment area under the ELP. In that regard the Decision Letter at paragraph 10 had said that in the ELP the Council had identified prime areas “as being the significant Employment Areas in the District previously identified in the LP.” However, said Mr Holgate, the Council had not had an actual policy in those terms, and its witnesses had accepted in cross-examination that if the ELP came to fruition, the Appeal Site would not be an existing prime employment area. 

65.	In relation to the LP, policy EMP2 and accompanying explanatory material (found in paragraphs 5.3.1, 5.3.6, and 5.3.7) showed that what had been done was to identify as “employment areas” those which should primarily be kept for employment purposes. This did not mean that such an area would be a prime employment area, – that, said Mr Holgate, would require a qualitative assessment. Essentially, said Mr Holgate, the Council’s arguments involved a process of “elision.” Working from the reference in Policy EMP2 to land being “primarily” kept for employment purposes, the Council now used this to suggest that such land was “existing prime” employment land. This was unjustifiable, for “primarily” in Policy EMP2 qualified the use to which the land should be put, and did not involve any assessment of whether the land in question should be regarded as “prime”, as opposed to less than prime, employment land. 

The claimant’s application to amend

66.	It was in this context that Mr Holgate introduced his proposed additional ground of challenge, Ground 1A. It will be recalled that paragraph 3.2 (v) of the particulars of claim had said that it was common ground at the Inquiry that “very little weight could be given” to the LP. The Inspector’s witness statement disputed this. It said at paragraph 7 that the Council’s witness took the view that the LP policies should be given “due weight”, and that the Council’s approach was set out in paragraphs 13-14 of their closing submissions. Although the witness statement did not spell this out, paragraph 13 of the Respondent’s Written Closing accepted that “limited weight” could be placed on the policies in the LP. This aspect, said Mr Holgate, had been “glossed over” by the Inspector in his witness statement. As noted earlier in this judgment Mr Holgate did not persist in the assertion that the Council conceded that “very little weight” as opposed to “limited weight” should be given to policies in the LP. Nevertheless he maintained that “due weight” was ambiguous, as was the Inspector’s statement in paragraph 11 of the Decision Letter that the LP being out of step with the SP “does … reduce the weight that policies EMP2 and WAR3 carry in this appeal.” Mr Holgate made no complaint as regards the assessment of weight to be given to the ELP, where paragraph 6 of the Decision Letter used the term “limited weight.” The use in paragraph 11, however, of the verb “reduce” in relation to the weight to be given to the LP showed the Inspector had not grappled with the issue of how great the reduction should be. Similarly, by citing “due weight” in his witness statement, the Inspector had missed the point. It was his job to say how much weight was to be given to policies in the LP, or if he could not say how much then to explain why. 

67.	The application to amend was opposed by the first defendant. In reply to that opposition, Mr Holgate said that the Inspector had not been able to recall Mr Thomsett saying “limited” weight could be given to the LP. It was very important that in a plan-led section 54A process the Inspector made it clear how much weight he gave to a particular factor. The word “reduced” might mean “reduced by an insignificant amount.” Given that the Inspector had made a whole series of negative criticisms, one could not understand what he meant when he said that this particular factor “does reduce” the weight to be given to the LP. 

68.	However, to my mind, the proposed amendment had nothing to commend it and the points made in reply were insubstantial. There is no express obligation imposed on the Inspector to quantify the amount of any reduction in weight which he gives to a particular factor. In the present case, his Decision Letter explained the reasons for the reduction in weight – the LP was out of step with the SP, for reasons which he identified. This analysis by the Inspector was positively helpful to the claimant. It meant that on factors where the SP differed from the LP the Inspector would consider how the disjunction between the LP and the SP affected the matter in question. The outcome of that consideration would, of course, be a matter for the Inspector, subject to review on established public law grounds. In some circumstances it might mean that the LP carried little weight, and in others that might not be the case. I can see no basis whatever for the suggestion that the Inspector ignored the Council’s acceptance that the LP had “limited” weight. For those reasons, which are essentially those given by Mr Strachan on behalf of the first defendant, I refuse permission to amend. 

Introductory submissions for the defendants

69.	Mr Strachan, in submissions which were adopted by Ms Busch, said that this challenge was an inappropriate forensic and over-legalistic attempt to impugn a decision which was clear and properly reasoned.  The Inspector had plainly identified and determined the main issue on the appeal, and gave cogent reasons for his decision.  He had explained why he considered the residential proposal as not an appropriate use of the site bearing in mind its designation and importance as an employment area, and the absence of any overriding need for its release for housing. While the claimant might disagree with the Inspector’s judgment, this was not a proper basis for seeking to re-open the merits of the decision, particularly by reference to unjustified and unwarranted extensive and lengthy criticisms of the Inspector’s decision and reasons.

70.	Mr Strachan rejected Mr Holgate’s description of the LP as being “in limbo”. The 1990 Act at section 54A refers to the development plan. In the present case this comprised the SP and the LP. There was no limbo. As to the weight that was to be given to the development plan, submissions could be made on this. That is exactly what happened in the present case, which followed an entirely orthodox procedure. Both in the LP and the ELP the Appeal Site was employment land. It was well established, in particular by the judgment of Brooke LJ in R v Derbyshire County Council ex parte Woods [1997] JPL 958 that interpretation of policy was a matter for the decision maker. If in all the circumstances the wording of the relevant policy document is properly capable of more than one meaning, and the planning authority adopts and applies a meaning which it is capable as a matter of law of bearing, then that authority will not have gone wrong in law.

71.	Moreover, said Mr Strachan, the weight to be attached to material considerations and matters of planning judgment is entirely a matter for the planning authority. As Lord Hoffmann pointed out in Tesco Stores Limited v Secretary of State for the Environment [1995] 1WLR 759 at 780, provided that the planning authority has regard to all material considerations, it is at liberty (short of Wednesbury irrationality) to give them what ever weight the planning authority thinks fit or no weight at all. This is an aspect of the fundamental principle that the courts are concerned only with the legality of the decision making process and not with the merits of the decisions. If there is one principle of planning law more firmly settled than any other, it is that matters of planning judgment are within the exclusive province of the local planning authority or the Secretary of State. Applying those principles, said Mr Strachan, whether an appropriate use for this site was office development was precisely the type of planning judgment which the courts would not interfere with. 

72.	As to the reasoning process found in the Decision Letter, Mr Strachan submitted that the claimant had taken the court through a marking exercise, testing the decision letter against the Appellant’s Updated Closing, of exactly the kind that was condemned in South Somerset District Council v Secretary of State for the Environment [1993] 1 PLR 80 at 83E to G and 87F to G, and Clarke Homes Limited v Secretary of State for the Environment (1993) 66 P&CR 62 at 271-272. Mr Strachan submitted that the Inspector’s task was less onerous than that of a judge in the High Court. The test identified by Lord Brown in South Buckinghamshire District Council v Porter (No.2) [2004] 1WLR 1953 at paragraph 36 was whether the reasoning gave rise to “a substantial doubt as to whether the decision maker erred in law”. In that regard, an adverse inference “will not readily be drawn”. 

73.	On the references made by the claimant to the Appellant’s Updated Closing, Mr Strachan said that while such written submissions, recording the points argued, can be useful to an Inspector, their use to support a section 288 challenge has to be treated with caution. In particular: 

(i)	The question for the court is whether the Inspector had regard to relevant material considerations and provided reasons dealing with the principal important controversial issues in determining the appeal (in accordance with the legal principles dealt with above). It is not an exercise of marking an examination paper by reference to submissions.

(ii)	In any event, if relying on written submissions, it cannot be right simply to ignore the submissions made by the other party to the appeal.  While the claimant exhibited and relied on its own submissions, it neither exhibited nor referred to those of the Council on the principal important controversial issues and areas of potential disagreement.

(iii)	As in this case, the closing submissions often consist of written text and oral additions. The Inspector’s Decision Letter properly dealt with the contentions advanced by the parties at the inquiry generally, including those made orally such as those of the Council relating to the viability study.

74.	By way of commentary on the Decision Letter, Mr Strachan noted that a site visit had been made on 2 December 2004. This was an important part of the process. In paragraph 8 of the Decision Letter the Inspector described in detail the nature of the site, and he expressly referred to the proposed 26 units of affordable houses. 

75.	Mr Strachan gave an overview of the Decision Letter. I shall incorporate certain elements of this overview later in this judgment when discussing particular grounds of review. 

Ground 1: SP Policy 14

Ground 1: submissions for the claimant

76.	The Council’s reasons of 5 November 2003 had stressed that use for anything other than employment purposes would contravene Policies EMP2 and WARE3 in the LP. An important part of the claimant’s case at the Inquiry was that “material considerations” within the meaning of s 54A of the 1990 Act made it appropriate to depart from those policies. In particular, those policies had been adopted prior to, and thus took no account of, PPG3 issued by central government and Policy 14 in the SP (“Policy 14”). The claimant’s first ground of challenge made a number of complaints about the way in which the Decision Letter dealt with a particular aspect of Policy 14. 

77.	The points made by the claimants at the Inquiry about Policy 14 were summarised at paragraphs 4.4 to 4.7 of the Appellant’s Updated Closing as follows:

“4.4 	Structure Plan Policy 14

Mr Thomsett accepted that this policy adopted in 1998 for the Plan period running to 2011 contained a number of requirements for monitoring of employment land supply and demand, and that this would have [included] a requirement for the Local Authority to undertake [an] Employment Study at a much earlier stage.

4.5	The second paragraph of the policy states that ‘development will take place mainly in areas allocated for such purposes in Local Plans, and key employment sites and existing prime employment areas will be identified in them….’  Thus it is clear that a “prime employment area” is to be identified as such in the Local Plan.  Mr Thomsett accepted that that had not been done either in the Adopted Local Plan or in the deposit draft of the Second Review of the Local Plan.

4.6	Mr Thomsett agreed that Policy 14 is substantially different from policy 73 of the 1986 Structure Plan in that it introduces a criteria-based approach for the first time and allows for the release of employment sites to housing or mixed use (see criterion 8).

4.7	Mr Fairbrass stated that no conflict with the Adopted Structure Plan policy is alleged in this case. Indeed, there is no reference to any such conflict in the Committee Report or reasons for refusal.  As to Policy 14, he expressly accepted that there was no conflict with that policy for the reason that the appeal site has not been identified in the Local Plan as falling within a prime employment area.”  

78.	Policy 14 was summarised by the Inspector at paragraph 5 of the Decision Letter in this way:

“… Policy 14 of the SP states that key employment sites and existing prime employment areas where employment development will be promoted will be identified in local plans.  Criteria are listed against which new proposals should be considered, including the need to ensure an adequate and balanced supply of employment floor space and the aim of securing planned regeneration.”

79.	In relation to Policy 14 the Decision Letter at paragraph 10 said this:

 “The Council’s employment strategy is based on concentrating employment development within existing identified Employment Areas. The existing prime employment areas that SP Policy 14 says should be identified in local plans can be seen from policy WA8 of the emerging LP to be basically the same Employment Areas in Ware found in policy WAR3 of the current LP. Broadmeads is identified as one of these in both the existing and the emerging Plans. The Council has simply identified prime areas in the emerging Plan as being the significant Employment Areas in the District previously identified in the LP.”

80.	Also relevant is paragraph 22:

“Overall, on balance, I find that there is a realistic prospect of the site being developed for employment use within the Plan period, subject to it becoming available for that purpose. It therefore cannot be said that the site is no longer needed to meet future employment requirements and business and community needs. I consider that the proposed development would result in the loss of employment land reserved for that purpose in both the existing and emerging Local Plans. Whilst I have concluded that the relevant LP policies carry reduced weight, the proposal would also be contrary to Policy 14 of the SP. This states that only existing employment provision that is no longer required to meet future employment purposes may be re-used for other purposes.”

81.	The claimant asserted, and Mr Strachan and Ms Busch did not deny, that in paragraph 10 of the Decision Letter the Inspector proceeded on the basis that the areas identified in Policies WARE 3 and WA8 were prime employment areas for the purposes of Policy 14. Nowhere in the LP or the ELP or in the reasons of 5 November 2003 did the Council use the word “prime” to describe those areas, and the Council’s witnesses had conceded that they had not been “designated” prime employment areas for the purposes of Policy 14. Yet the Decision Letter had made no reference to these concessions when reaching the view that the Appeal Site, and other “significant Employment Areas in the District previously identified in the LP,” had been identified in the ELP as “prime areas” for the purposes of Policy 14.

82.	The Inspector dealt with this aspect at paragraphs 8 to 11 of his witness statement. Paragraph 8 described the issue as being: 

whether the site could be categorised as a “prime employment area”.

83.	Paragraph 9 of the Inspector’s witness statement was as follows:

I believe Mr Thomsett accepted that the site was not identified by name as a “prime employment area”, but it was clear from his evidence, as reflected in the Council’s closing submissions (see in particular paragraph 9),  that the existing significant and higher quality employment areas were identified in the emerging local plan and seen to be similar to those in the adopted local plan as existing employment areas primarily to be reserved for industry.

84.	However, said Mr Holgate, when one goes to paragraph 9 of the Respondent’s Written Closing one can find no assertions of the kind described by the Inspector. It reads as follows:

The key policy in the ASP … is Policy 14. This states, inter alia, that “key employment sites” and “existing prime employment areas” will be identified in areas allocated for employment uses in local plans, where employment development will be promoted.

85.	Indeed, said Mr Holgate, nowhere in the Respondent’s Written Closing did one find any reference to evidence “that the existing significant and higher quality employment areas were identified in the emerging local plan and seen to be similar to those in the adopted local plan as existing employment areas primarily to be reserved for industry.” That was because there was no such evidence. The matter had been put in this way by the Council at paragraph 18 of the Respondent’s Written Closing:

… the critical point in this regard is that Policy 73 and Policy 14 are broadly consistent in their terms. Hence even if Policy EMP2 is not strictly speaking an application of Policy 14, [it] nonetheless can and should be treated as a realisation of its objectives, including in particular the objective that local plans should identify “prime employment areas”, which objective is achieved by the identification of the Broadmeads site in Policy WARE3, including the Appeal Site, as an Employment Area “primarily reserved” for employment uses in accordance with Policy EMP2.

86.	This, said Mr Holgate, involved the unjustifiable process of elision mentioned earlier. The structure plan applicable at the time policies EMP2 and WARE3 had been adopted did not require “prime employment areas” to be identified as part of a criteria based approach. The Inspector in paragraph 9 of his witness statement had underlined the word “name”, but the issue raised by the claimant was not just “nominalism”. When preferring one witness over another, the Inspector must deal with the point: see Seddon Properties.

87.	Paragraph 11 of the Inspector’s witness statement added:

I also agree that Mr Thomsett agreed that no breach of Policy 14 of the Structure Plan had been put forward as one of the 3 reasons on which the Council would have refused the application, but he did state it would be contravened in answer to one of my questions, and this answer was consistent with his statement in paragraph 3.7 of his own proof of evidence, and the Council’s closing submissions at paragraph 21(i).

88.	Reference to the paragraphs cited in the last sentence, however, showed that this was concerned with the point at paragraph 22 of the Decision Letter – whether the Appeal Site was no longer required to meet future employment purposes. Thus Mr Thomsett’s answer to the Inspector did not offer any basis for concluding that the Appeal Site could be regarded as an “existing prime employment area” within Policy 14. Moreover, said Mr Holgate, the Inspector’s witness statement did not attempt to deal with the claimant’s point that similar concessions had been made by Mr Fairbrass. 

89.	In reply to a question from me, Mr Holgate clarified that the point was not simply that because no new local plan had been adopted since the SP the Appeal Site could not have been designated a “prime” site under Policy 14. In addition, the claimant had been making the point that the ELP had not sought to perform the qualitative exercise of identifying “prime” sites. 

90.	It was on this basis that the claimant contended under Ground 1 that the Inspector erred in law in that:

(i)	He failed to have regard to material considerations, namely the concessions of Messrs Thomsett and Fairbrass recorded in paragraphs 4.5 and 4.7 of the Appellant’s Updated Closing; and/or

(ii)	His conclusion was based on no evidence; and/or

(iii)	He failed to give proper, adequate and intelligible reasons on the application of Structure Plan Policy 14, including why, if it was the case, he was departing from the concessions; and/or

(iv)	He also failed to have regard to a further material consideration, namely that the earlier Structure Plan policy, from which the local plan employment allocation derived, did not allow for or encourage the release of employment sites to housing, unlike Policy 14 and its supporting text.

Ground 1: submissions for the defendants

91.	It is convenient to begin with the skeleton arguments for the defendants.

92.	The skeleton argument of the first defendant included points as follows:

(i)	the claimant’s allegations wrongly characterised the material before the Inspector. In paragraph 10 of the DL, the Inspector concluded that the Employment Areas proposed to be identified under Policy WA8 of the emerging Local Plan (like those identified under Policy WARE3 of the Local Plan) fell within the description of prime employment areas which were to be identified in local plans for the purposes of Policy 14 of the Structure Plan.  This was a matter of interpretation and judgment which was exclusively for his determination (see e.g. ex p Woods and Tesco Stores above).  There was no proper basis for suggesting he had erred in law in reaching and explaining his decision.

(ii)	He was not treating a “prime employment area” as a term of art, requiring formal designation or labelling within a local plan as a “Prime Employment Area”, but nor was there any basis for suggesting that use of the words “prime employment area” necessarily carries such a meaning.  In contrast to the Structure Plan’s express designation of “Key Employment Sites”, there is no equivalent designation of prime employment areas.  The Inspector has quite legitimately concluded that the identified Employment Areas in the Local Plan and emerging Plan can, and should, be treated as prime areas for employment for the purposes of identifying employment land consistent with the intention of the Structure Plan and the Council.

(iii)	This was neither a surprising conclusion, nor should it be contentious in light of the relevant policies. The reasoned justification to both the Local Plan and the emerging Plan explained that the identified Employment Areas were intended to be allocations to meet their respective structure plan employment requirements. The suggestion that the Inspector’s conclusion was based on no evidence wrongly assumed that an Employment Area designated in the Local Plan cannot be treated as a prime employment areas for the purposes of Policy 14 because it is not expressly labelled “Prime Employment Area”. The Inspector’s decision was said to be a perfectly rational and commonsense reading of the policies. 

(iv)	Mr Thompsett’s concession that Broadmeads was not designated by name in the Local Plan or emerging Plan as a “prime employment area” conceded no more than what was obvious from the words of the policy. It was certainly no bar to a conclusion that Broadmeads is in fact a prime employment area within the meaning of Policy 14. It was the Council’s case that designation of Broadmeads as an employment area in the Local Plan and emerging Local Plan achieved the objective of Policy 14 of the Structure Plan to identify “prime employment areas”.

(v)	The Council’s reasons for refusal did not allege conflict with Policy 14 of the Structure Plan, but nor did the Inspector suggest that they did. He had merely legitimately reached his own judgment that the existing prime employment areas that SP Policy 14 says should be identified in local plans can be seen from Policy WA8 of the emerging LP to be basically the same Employment Areas found in policy WAR3 of the current Local Plan, and the Council has simply identified prime areas in the emerging Plan as being the significant Employment Areas in the District previously identified in the Local Plan.

(vi)	As to Broadmeads itself, it plainly was regarded as a prime employment area. 

(vii)	It was correct that the earlier Structure Plan policy, from which the Local Plan employment allocation derived, differed from Policy 14 and its supporting text. However it was wrong for the claimant to suggest that the Inspector ignored this. Paragraph 11 of the Decision Letter showed that the Inspector did have regard to the differences between Policy 14 of the Structure Plan, and those of its predecessor Policy 73 of the previous Structure Plan, and any consequential effects on the interpretation of the Local Plan. The Inspector acknowledged (amongst other things) that Policy 14 altered the way that employment policies should be viewed in that it identified a criteria based approach.  

93.	The Council in its skeleton argument made points which included the following:

(i)	 The Inspector was fully entitled to proceed on the basis that the Appeal Site could be treated as a prime employment area for the purposes of Policy 14. Mr Thomsett’s “concession” was only to the effect that the Appeal Site was not expressly stipulated to be a “prime” employment area in the LP (i.e. specifically, in policies EMP2 and WARE3). The Council’s case was, however, quite clearly, that set out in paragraph 10 of the Decision Letter. This complaint, therefore, wholly lacked in substance, amounting to no more than the purely semantic point that, as the Council agreed, the areas designated as “employment areas” in the LP are not called “prime employment areas”, in terms. 

(ii)	For the same reasons the Inspector did not err in law by failing to have regard to a material consideration, namely, the Council’s so-called “concession”, since the “concession” was not one made with regard to the Council’s substantive case with respect to the question of whether or not the Appeal Site should be treated as a “prime employment area” for the purposes of Policy 14. 

(iii)	Concomitantly, the Inspector was fully entitled to accept the evidence of Mr Thomsett as to the approach that the Council took to safeguarding the relevant employment areas, including the Appeal Site, pursuant to the policies contained in the LP and SP. Likewise, he was fully entitled to take the  view that the employment areas identified as such in policies EMP2 and WARE3 of the LP, and also in policies EDE1 and WA8 of the emerging LP, constituted prime employment areas for the purposes of Policy 14 of the SP, in that this was a matter of interpretation of the relevant policies that was solely for his determination (R v Derbyshire CC ex parte Woods). 

(iv)	It was wholly untenable for the claimant to suggest that the Inspector’s conclusion that the appeal proposal would breach Policy 14 was based on “no evidence” Mr Thomsett’s answer to the Inspector was relied on in this regard. Moreover, the question whether the appeal proposal would result in a breach of Policy 14 turned upon the question whether the Appeal Site could be treated as a “prime employment area” for the purposes of that policy, and upon whether or not it was no longer required to meet future employment requirements. Substantial evidence was adduced at the Inquiry by both parties’ witnesses, as was plain from the claimant’s own Ground 1, as regards the first matter; and as was manifestly apparent from the proofs of evidence of all of the witnesses, as regards the second. 

(v)	The alleged concessions of Messrs Fairbrass and Thomsett were wholly consistent with the proposition that if the Appeal Site did not constitute a “prime employment area”, as the claimant sought to maintain, then there would be no breach of Policy 14. The Council’s whole case, however, was as set out in Decision Letter para 10; and Mr Thomsett confirmed that the Council’s position was indeed that the appeal proposal would, in its view, breach Policy 14, when the Inspector sought clarification on this point from him. 

(vi)	It was perfectly plain from paragraph 22 of the DL, and the Decision Letter read as a whole, why the Inspector concluded that the appeal proposal would be contrary to Policy 14 of the SP, namely, because he accepted the Council’s case that the Appeal Site was a prime employment area for the purposes of that policy, and that it was not “no longer required to meet future employment purposes”. Since, as noted above, the claimant’s own witness addressed the question of conformity to Policy 14 by reference to the questions of whether the Appeal Site was or was not a prime employment area, and whether it was or was not required for the latter purpose, it was untenable for it to seek to maintain that it did not understand the Inspector’s reasoning on this point. 

(vii)	The Council did indeed accept that a contrast could be drawn between the two Structure Plan policies, on the basis that the earlier policy from which the LP allocation derived did not allow for or encourage the release of employment sites to housing, unlike Policy 14. This was not, however, a “material consideration” which it was incumbent upon the Inspector specifically to address for the purposes of his Decision. The Council’s case was clearly to the effect that the Appeal Site should be retained for employment uses, notwithstanding the introduction of Policy 14 of the SP. Consequently, the fact that the Council accepted that the two Policies could be contrasted in the manner in question was irrelevant to the issues in the appeal. Further, or alternatively and in any event, the Inspector expressly addressed the differences between the two SP policies in Decision Letter para 11. Hence any claim to the effect that he failed to have regarded to the differences in question in making the Decision is wholly misconceived. 

94.	In oral argument Mr Strachan submitted that Policy 14 had to be read in the context of paragraphs 240 to 249 of the SP (see paragraph 15 above). A key point was that allocated employment land was thought to be sufficient. “Key Employment Sites” was a term of art – it had a specific meaning, and the sites were identified by name. The last sentence of paragraph 248 was important. The key theme was that qualitative issues were as relevant as quantitative issues. Turning to the second paragraph of Policy 14 (set out at paragraph 16 above), this district has treated its allocation of employment land as existing prime employment areas to be promoted. The focus identified by the claimant on the “prime” was misconceived. The Inspector had focused on the last part of Policy 14, not the second paragraph. That last part triggered a question – is the land required for local purposes? This was a qualitative and quantitative assessment. The structure plan then dealt with key employment sites, but there is no separate treatment of existing prime employment areas.

95.	Returning to the LP, Mr Strachan noted that as part of policy EMP 2 the Council had determined to “resist … inappropriate proposals.” In relation to policy WARE 3, paragraph 12.5.2 of the LP was in these terms:

In recent years a considerable number of former industrial sites have been converted or redeveloped for residential purposes.  Whilst the possibility of further similar developments is not ruled out, the District Council considers it important to identify and defend the key remaining employment centres in the town.

96.	Given the reference in that paragraph to “key”, it could be no surprise that this site should be regarded as prime.

97.	On the ELP, at paragraph 6 of the Decision Letter the Inspector noted that because it had yet to face a public inquiry, it carried limited weight, but it demonstrated the future intentions of the Council towards employment and housing matters. The Inspector identified Policies EDE1 and WA8 as being similar to policies EMP2 and WARE3.  

98.	Mr Strachan drew attention to paragraph 6.4.2 of the reasoned justification to Policy EDE1 :

“6.4.2	The Structure Plan has concluded that there is sufficient land and floorspace currently in employment use, together with the Key Employment Sites and other allocated employment land, such that no new land allocations are required.  The Structure Plan directs such development to existing allocated employments areas, which are to be identified in local plans.

He submitted that the ELP therefore treated identification of existing allocated employment areas as those to which the Structure Plan directs employment uses.

99.	Further, the reasoned justification to Policy WA8 explains at paragraph 13.5.4 of the ELP:

“The Council considers that, in order to maintain a supply of employment land, the Park Road/Harris Lane (GlaxoSmithKline); Marsh Lane; Broadmeads; and Widbury Hill Areas should continue to be primarily reserved for such purposes.”

Mr Strachan attached particular significance to the use of the word “maintain” in paragraph 13.5.4.

100.	Ms Busch in oral submissions noted that the approach taken by Mr Parsons in relation to Policy 14 was to express his personal view. He had said in paragraph 4.10 of his proof of evidence, “I would not regard it as a “prime” employment site.” In another section of his proof, however, he addressed head on the question whether the site was required for future employment purposes. On that the council’s witnesses gave their views. Plainly this was a matter for the Inspector to decide, and it was not appropriate for this court to interfere. 

101.	As to the alleged concession by Mr Fairbrass, he had simply accepted that in so far as the Appeal Site was not a “prime” site then the specific provision in Policy 14 for such sites would not apply. 

Ground 1: the claimant’s reply

102.	Mr Holgate reminded the court that paragraph 8 of the Inspector’s witness statement showed that he correctly understood the issue to be whether the Appeal Site could be categorised as a “prime employment area”.  That was because there was a change in the SP. The assertion had been made by Mr Strachan that the Respondent’s Written Closing showed that the council was treating existing employment areas as “prime”, but the Respondent’s Written Closing had not asserted that the Council had sieved to see if existing sites were indeed prime sites. Policy 14 had required a qualitative assessment for this purpose, and none had been described. 

103.	As to the Council using the adjective “key” in relation to Policy WARE 3, the Inspector had not relied on this. The Council had never purported to have done the Policy 14 exercise. Moreover, said Mr Holgate, the ELP had not repeated that text. 

Ground 1: analysis

104.	Paragraph 10 of the Decision Letter is the first paragraph under the heading “Appropriate use of employment land.” Thus on the first element in the case the Inspector chose to take as his starting point a discussion of the requirement in Policy 14 that local plans should identify “existing prime employment areas” where employment development would be promoted. 

105.	This was not the main question which arose under Policy 14. The last sentence of Policy 14 contained an important restriction: only types and quantities of existing employment provision which are no longer required to meet future employment requirements and business and community needs could be re-used for other purposes. On the first element in the case the claimant did not contend that material considerations indicated that Policy 14 should not apply – the only point taken in that regard arose under the second element, housing need. Thus on the first element, having accepted that the Appeal Site formed part of “existing employment provision”, the claimant had to make good the proposition that future employment requirements and business and community needs did not – in relation to the Appeal Site – call for that type and quantity of employment provision to be retained. Paragraphs 11 to 22 of the Decision Letter were concerned with various aspects of that proposition. 

106.	Nevertheless the parties had made submissions about the requirement to identify “existing prime employment areas”. Paragraph 10 of the Decision Letter does not expressly say what those submissions were, but it is not necessary for it to do so – as Lord Brown observed in South Buckinghamshire, decision letters are addressed to parties well aware of the issues and arguments. What is necessary is to give intelligible reasons which enable the reader to understand why the matter was decided as it was. 

107.	The Inspector did not discuss the significance of compliance or non-compliance with the requirement to identify “existing prime employment areas where employment development will be promoted”. I take the view that if he thought that non-compliance would be insignificant he would have said so. Accordingly I shall examine what I understand to have been the rival contentions on whether the requirement had been met, and how the Inspector dealt in the Decision Letter with issues arising out of those contentions.

108.	On the one hand, the claimant wanted to show that residential development at the Appeal Site would not interfere with the locations where under Policy 14 employment development was to be promoted: key employment sites and existing prime employment areas. In this regard, it had made (at least) three points. One point can be conveniently described as “express identification.” It was that Policy 14 said that a “prime employment area” was to be identified as such in the LP (see Appellant’s Updated Closing paragraph 4.5, second sentence) and that this had not happened either in the LP or in the ELP (see the remainder of Appellant’s Updated Closing paragraph 4.5). Another point can be described as “fundamental change”. This was that Policy 14 was substantially different from the previous structure plan in that it introduced a criteria-based approach for the first time (see Appellant’s Updated Closing paragraph 4.6). A consequence which was not spelt out in the Appellant’s Updated Closing but would be readily apparent was that an identification of a site as “prime” in the LP would be unlikely to satisfy Policy 14, for it would not have taken account of the fundamental change. A third point can be described as the “concession” point – it was said that Mr Thomsett had conceded both the express identification and the fundamental change points (see Appellant’s Updated Closing paragraphs 4.5 and 4.6) and that Mr Fairbrass had conceded the express identification point (see Appellant’s Updated Closing paragraph 4.7). This third point was thus a reinforcement of the first two points.

109.	On the other hand the Council said that Policy EMP2 either realised Policy 14’s objective of identifying “prime employment areas”, or should be treated as doing so (see Respondent’s Written Closing paragraph 18). The Council added that Policy WA8 in the ELP was consistent with this (see Respondent’s Written Closing paragraphs 19 and 20).

110.	On the express identification point, the Respondent’s Written Closing recorded at paragraph 9 the part of Policy 14 which said that “existing prime employment areas” would be identified. This document did not expressly address the question whether there was an obligation to identify “prime” areas as such. However, given that the LP did not use the word “prime”, it was necessarily implicit in paragraph 18 of Respondent’s Written Closing that there was no such obligation. 

111.	It is not clear to me what view the Inspector, in paragraph 10 of the Decision Letter, took on this point. He thought – see the second sentence of paragraph 10 of the Decision Letter - that Policy WA8 of the ELP showed that the “existing prime employment areas” which Policy 14 says “should be identified” were basically the Employment Areas identified in Policy WARE3 of the LP. However Policy WA8 does not refer as such to “prime” areas. There is an assertion in the last sentence of paragraph 10 that the Council “simply identified prime areas” in the ELP, but no explanation as to how what was said in the ELP amounted to such an identification. 

112.	Was the Inspector saying in paragraph 10 of the Decision Letter that Policy WA8 tells us enough to see which sites should be identified as “prime”, and so Policy 14 would be met if when the ELP comes to be adopted that identification is expressly made? Or was he saying that the designation was implicitly made in Policy WA8, and an implicit designation is enough to satisfy Policy 14? The assertion in the last sentence of paragraph 10 leads me to suspect that he may have intended the latter. Paragraph 9 of the Inspector’s witness statement would tend to confirm my suspicion on this point, but I cannot have any confidence that my suspicion is right.

113.	If the Inspector implicitly concluded that an implicit designation is enough to satisfy Policy 14, then I cannot discern from the Decision Letter why he took that view. Perhaps more importantly, I cannot discern why he thought that what was said in Policy WA8 amounted to an implicit designation of the areas in question as “prime”. Nor are these matters explained in the Inspector’s witness statement. 

114.	This is not a case where the conclusion implicitly explains the reasoning which led to it. If Policy 14 does not require that a “prime” area be identified as such, how does it contemplate that a “prime” area will be identified? What was it about Policy WA8 which showed that the sites it identified were “prime”? Did Policy 14 require the Council to “sieve through” the locations where land was to remain designated for employment provision, and identify such of those locations as it considered “prime”? If so, what had the Council done to meet such a requirement? These appear to me to be basic questions. There are no answers given in the Decision Letter. Answers were given by Mr Strachan and Ms Busch, which were in broad terms that in formulating the ELP the Council had applied the criteria-based approach found elsewhere in Policy 14, and had concluded that there was a strong case for retaining as employment land all the sites identified in Policy WA8. I question whether the ELP goes that far, for in paragraph 6.4.2 it indicates merely that a long term requirement for office floorspace will be addressed as part of the future Local Development Framework. In any event, however, these answers are not to be found in the Decision Letter.

115.	Does the Decision Letter need to answer these questions? I readily accept that I am not concerned with a marking exercise, that the interpretation of policy is a matter for the decision-maker, and that, where the interpretation is one that the policy is reasonably capable of bearing, there is no basis for intervention by the court. On this point, however, I simply do not know how the Inspector interpreted Policy 14 and Policy WARE 8. In those circumstances I cannot say whether that interpretation is one which the policy is reasonably capable of bearing, and for that reason alone I regard the reasoning in the decision letter as inadequate and prejudicial to the claimant. 

116.	On the fundamental change point, the Council robustly denied that there was any such change (see Respondent’s Written Closing paragraph 18). The Inspector disagreed with the Council. It is clear from paragraph 11 of the Decision Letter that he concluded that Policy 14 altered the way in which LP employment policies should be viewed. There was therefore no need for him to deal with the concession point on this aspect. His reasons are sufficiently set out for present purposes in the second sentence of that paragraph. Consistently with this, the Inspector does not suggest that Policy EMP2 complied with the part of Policy 14 dealing with “prime” areas, and implicitly he rejects the Council’s contention in that regard. Having done so, however, he does not say that Policy WA8 took account of the fundamental change when performing the function he describes in the second sentence of paragraph 10 of the Decision Letter. I do not think it can be said that this conclusion is implicit. Such a conclusion would run counter to paragraph 11 of the Decision Letter. Moreover the Council had robustly said that there was no fundamental change. I can see no logical basis for a conclusion that the Council had identified “prime” sites using the new criteria in Policy 14. 

117.	As to the concession point, this survives only as a reinforcement of the express identification point. The Decision Letter did not explicitly address this point. If it had specifically addressed the express identification point, it might have been possible to say that what was said implicitly explained why the concession did not matter. The failure either explicitly or implicitly to deal with the concession is a further inadequacy in the reasoning. It prejudices the claimant because it makes it impossible to judge whether the Inspector took the concession into account.

118.	There was not, in my view, any need for the Inspector to go into great detail on any of the above points. However, for the reasons given above, I conclude that the way in which he couched his views in paragraph 10 of the Decision Letter was inadequate and caused real prejudice to the claimant.

Ground 2: Prematurity 

Ground 2: the claimant’s submissions

119.	At the end of the section of the Decision Letter dealing with the first element, the Inspector said this:

“23 Furthermore, both local and national policies encourage the redevelopment of employment land to be identified through the development plan process as part of a planned regeneration package and not by the piecemeal redevelopment of individual Employment Areas. In my view, such developments could undermine the local strategy for economic development and regeneration and that adds weight to my conclusion that the proposal is not an appropriate use of this employment land, having regard to local planning policies”

120.	In relation to the second element, paragraph 25 of the Decision Letter said:

“…In any event these claims add further weight to my belief that the need for the release of alternative sites should be determined through the Local Plan process.  I consider this to be particularly the case for brownfield sites such as this where there are different alternatives and competing uses.   The Council has taken the first steps in this direction by allocating several employment sites for mixed use development in the Second Re-Deposit version of the Plan Review in line with SP Policy 14 and para. 42 of PPG3.”

121.	The claimant said that in these passages the Inspector relied on prematurity as a ground for refusing the application. The Secretary of State’s Guidance Note PPG1 made it clear, said Mr Holgate, that refusal of planning permission on grounds of prematurity will only usually be justified where a grant of permission would prejudice the outcome of the development plan process (see paragraph 47 of PPG1). This was not a legal requirement on the Inspector, but if he was proposing not to apply policy guidance, then he should say so:  see Stephenson v Secretary of State for the Environment [1986] JPL 357 at 358 left hand column. 

122.	The Appellant’s Updated Closing had dealt expressly with prematurity at paragraph 3.1 (B1/310). This read as follows:

“Prematurity

An important meeting of the full Council was held on 28 July 2004 to decide how to react to the requirements of the 2004 Act and criticisms by GOER of progress on the Review of the Local Plan.   The Council has decided to opt for the transitional procedure and proceed towards adoption by March 2007.  The Local Plan issues which need to be resolved were therefore well in the mind of Members at the Committee meeting on 10 November 2004, which dealt with parallel applications. At that meeting, it was not suggested by any Officer or Member that the proposal should be refused on prematurity grounds.  Mr Fairbrass also confirmed that no one had sought to apply the test in paragraph 47 of PPG1 and that prematurity did not form a part of the Council’s case as a ground for refusal for this appeal.   Mr Thomsett’s view on the matters should therefore be accorded no weight.  Furthermore he did not even attempt to apply the paragraph 47 test in his evidence.”

123.	The reference in paragraph 3.12 “Mr Thomsett’s view” was an acknowledgement that Mr Thomsett had differed from Mr Fairbrass by saying that there was a prematurity point. However, Mr Thomsett could not explain how his point fell within paragraph 47 of PPG1. This, said Mr Holgate, was another area where the Inspector had not dealt with a conflict between witnesses, and it could not just be brushed to one side. 

124.	As to paragraph 23 of the Decision Letter, Mr Holgate accepted that the Inspector was right to say that both local and national polices encouraged the redevelopment of employment land to be identified through the development plan process as part of a planned regeneration package and not by the piecemeal redevelopment of individual employment areas. However, those policies did not say that a planned regeneration package was the only way in which one could redevelop employment land. On the question of housing needs, the Decision Letter at paragraph 25 rejected certain of the claimant’s points. For the purposes of the present challenge, the claimant did not complain about the rejection of those points in themselves. However, when in paragraph 25 the Inspector went on to say that these points “add further weight to my belief that the need for release or alternative sites should be determined through the local plan process,” this was plainly a reference back to paragraph 23 of the Decision Letter. The point being taken was a prematurity point. Thus when the defendants said that in paragraph 23 of the Decision Letter the Inspector was talking only about the future they were guilty of sophistry, for the reasoning in paragraph 23 was being used to reject the proposals. 

125.	The legal complaints arising in relation to prematurity were then described by Mr Holgate. First, the claimant said that the Inspector failed to take into account as a material consideration the concession by Mr Fairbrass that it was not part of the Council’s case to ask for the appeal to be dismissed on grounds of prematurity. Second, the Inspector failed to take into account paragraph 47 of PPG1. Third, he had failed to apply the test in paragraph 47 of PPG1. Fourth, he had failed to resolve the conflict between Mr Thomsett and Mr Fairbrass as to whether prematurity was relied upon by the Council. Fifth, he had failed to state that he was departing from the test on prematurity in PPG1 (as required by the Stephenson case) or the concession made by the Council and to give reasons for so doing. Sixth, there was no policy to support the Inspector’s views on prematurity, for neither Policy 14 nor paragraph 42 of PPG3 discouraged the release of employment sites for housing outside the local plan process. No rational reading of the policies could support the view that the only way of redeveloping individual employment areas was through the development plan process as part of a planned regeneration package. 

126.	The seventh complaint in relation to prematurity was that the Inspector had acted unfairly in that he failed to raise the prematurity point with the claimant or its witness, the Inquiry having proceeded on the basis that prematurity was not an issue. In particular, given that Mr Fairbrass had said that there was no prematurity point, if the Inspector was going to take that point he needed to raise it with the claimant. I pointed out that paragraph 3.1 of the Appellant’s Updated Closing (quoted above) expressly sought to address prematurity. Mr Holgate replied that this merely reminded the Inspector that the Council had accepted that prematurity did not arise, and that no one had identified how this could be brought within PPG1 paragraph 47. After reading paragraph 3.1 of the claimant’s written submission, the only course for the Inspector would be to say, “I want to hear evidence about this, evidence bringing it within paragraph 47.” 

127.	In his witness statement at paragraph 12, the Inspector said this: 

“12. In paragraph 5.1 of the Particulars of Claim, reference is made to principles of prematurity as defined in paragraph 47 of PPG1. I confirm that it was agreed at the inquiry that prematurity was not part of the Council’s case, nor does my decision raise this as an issue.  Paragraphs 5.2-5.3 of the Particulars of Claim go on to make allegations of error based on my Decision Letter paragraphs 23 and 25. But these arguments are based upon a factual misreading of my Decision Letter. As I clearly identified in the first sentence of Decision Letter paragraph 23, both local and national policies encourage the redevelopment of employment land to be identified through the development plan process. Contrary to what is asserted in paragraph 5.3(v) of the Particulars of Claim, I did not say they discouraged the release of employment sites for housing outside the local plan process.”

128.	The last sentence of paragraph 12 was criticised as missing the point. In fact, said Mr Holgate, the Inspector had treated the policies in question as discouraging release outside the local plan process. 

129.	Finally on this aspect, Mr Holgate sought to counter any submission by the defendants that the Inspector’s views about prematurity were not causative of his decision to dismiss the appeal. Applying the test in Simplex GE (Holdings) Limited v Secretary of State [1988] 3 PLR 25, the question was whether the same decision would necessarily still have been made. One could not reach that conclusion given the link between paragraphs 23 and 25 of the Decision Letter and the general statement in paragraph 27 of the Decision Letter that the appeal was dismissed for “the reasons given above”. If the claimant succeeded in its contention that the Inspector’s decision on prematurity had been flawed then it was right that the Inspector should think again.

Ground 2: the defendants’ submissions

130.	The first defendant’s primary submission was that paragraph 23 of the Decision Letter was simply an additional conclusion at the end of the Inspector’s reasoning (in paragraph 22 of the Decision Letter, discussed below) on the question of whether or not the residential proposal was an appropriate use of this employment land, and whether there were realistic prospects of the site being developed. Similarly in Decision Letter paragraph 25, the focus of the claimant’s complaint was on an additional conclusion at the end of the Inspector’s reasoning on the question of whether or not the release of this land was required for housing.  

131.	On this basis Mr Strachan submitted that both passages complained of were additional to conclusions already reached on the two elements of the Inquiry, rather than part of the main conclusions.  The decision would have been the same had the Inspector not expressed these views, or had he expressed a different view on those issues. Accordingly, the criticisms made of these passages were academic. What had happened in the Simplex case, said Mr Strachan, was that the error was a logical step in the minister’s reasoning: see [1998] 3 PLR at page 42C. By contrast, in the present case the passages complained of formed no part of the reasoning which had led the Inspector to reject the contentions under consideration. 

132.	In any event, said Mr Strachan, the passages under complaint were not concerned with prematurity of the kind identified in PPG1 paragraph 47. Mr Strachan noted that the draft paragraph 42A which was under consideration for insertion in PPG3 said that applications to redevelop land no longer needed for industrial use should be considered favourably unless, among other things, its development for housing would undermine regional and local strategies for economical development and regeneration. The Respondent’s Written Closing had submitted that the present case fell within that exception. The Inspector had been entitled to reach the view that the appeal proposal could undermine the local strategy.

133.	Similar points were made by Ms Busch on behalf of the Council. 

Ground 2: the claimant’s reply

134.	In reply Mr Holgate said that, as regards the first defendant’s primary submission, Simplex could not be distinguished. The task for the Inspector, correctly identified at paragraph 4 of the Decision Letter, was not to decide the matter by applying Local Planning Policies but to judge whether the proposed developments was appropriate “having regard to Local Planning Policies.” Thus his conclusion on Local Planning Policies did not resolve the matter against the claimant. The first element had not been resolved against the claimant until the end of paragraph 23 of the Decision Letter by which time the prematurity point had been taken into account. Similarly on the second element the Inspector’s conclusion was reached only in paragraph 26 of the Decision Letter, after the passage under complaint in paragraph 25. When concluding in paragraph 27 that the appeal should be dismissed the Inspector said that this was “[f] or the reasons given above…” It was impossible for the court to be sure that in the absence of the prematurity point the decision would have been the same. 

135.	As to whether the considerations identified in the passages under complaint were considerations of prematurity of the kind contemplated by paragraph 47 of PPG1, Mr Holgate drew attention to the opening sentence of paragraph 48 of PPG1. This contained a perfectly general statement that unless the circumstances described in paragraph 47 applied, “refusal of Planning Permission on grounds of prematurity will not usually be justified.” On an ordinary use of language, the Inspector’s belief that the need for the release of alternative sites should be determined through the Local Plan process and not by piecemeal redevelopment was an assertion that it was premature to alter the designation of this land in the LP. 

Ground 2: Analysis

136.	The passages identified by the claimant in paragraphs 23 and 25 are, in my view, rightly criticised as assertions of prematurity. Unless the Inspector determined to act contrary to the guidance of paragraphs 47 to 49 of PPG1, he could only have relied upon prematurity as a factor against the claimant if the grant of permission would prejudice the outcome of the plan process by predetermining decisions about the scale, location or phasing of new development which ought properly to be taken in the development plan context. If that had been the case, then paragraphs 47 and 49 make it clear that the Inspector needs to explain why. However, nobody suggests that this was the case. The Inspector in his witness statement asserts that he did not say that relevant policies discouraged the release of Employment Sites for housing outside the Local Plan Process. To my mind, however, his comments in the criticised passages only make sense if he thought that those policies did indeed mean that a developer had to go through the local plan process rather than bring an appeal in relation to a specific site. The considerations in the proposed paragraph 42A of PPG3 are entirely different – and the Inspector made it clear in paragraph 13 of the Decision Letter that he gave those considerations little weight.

137.	The first defendant’s primary answer, however, is in my view much more substantial. The Inspector was bound to make his determination in accordance with the Development Plan unless material considerations indicated otherwise. In paragraphs 7 to 9 of the Decision Letter he reached positive conclusions about the site and surroundings. It could not be suggested, however, that those matters on their own would justify departure from the Development Plan. Material considerations on whether housing was an appropriate use of the land were discussed in paragraphs 10 to 23. A consideration favourable to the claimant was identified in paragraph 11: the fact that the LP designating the site as Employment Land was out of step with the SP reduced the weight that the LP policies carried in the appeal. Unfortunately for the claimant, all other points it advanced for departing from the LP were rejected. It is in my view clear that on this element the Inspector, quite apart from the prematurity point, and allowing for the LP being out of step with the SP, had found nothing which in his view would warrant a departure from the LP. Similarly on the second element, housing need, in paragraph 25 the Inspector rejected a number of the claimant’s points. He does not rely upon the prematurity aspect when rejecting those points. The remaining points on housing needs are rejected in paragraph 26. Again the Inspector does not rely upon prematurity when rejecting those points.

138.	My conclusion is that Ground 2 fails. The claimant’s criticisms are valid, but the matters criticised made no difference to the result. Unlike the Simplex case, the errors of the Inspector were not logical steps in reaching his conclusion – they were an additional ground for a conclusion which he had already reached by logical steps which were entirely independent of the passages complained of. 

Ground 3: Paragraph 42 of PPG3

Ground 3: the claimant’s submissions

139.	Here the claimant began with paragraph 12 of the Decision Letter, which read as follows:

“Para.42 of Planning Policy Guidance 3 Housing (PPG3) concerns the wasted resource of employment land that cannot realistically be taken up over the life time of the Plan or where planning policies have subsequently changed. It applies particularly to previously-developed land. Local planning authorities are required to review all of their non-housing allocations when reviewing their development plans and consider whether the land might be better used for housing or mixed use development. This paragraph is particularly relevant to this appeal because the site is previously developed land that is allocated as employment land in the Local Plan.”

140.	Paragraphs 13 and 14 are also relevant. The former is set out at paragraph 11 above. The latter comprised 5 sentences. For convenience, I have numbered them  as follows:

“14. (1) The Employment Land Study the Council has commissioned had gone a long way towards compliance with para.42 of PPG3 in that the employment land needs of the District have been identified and suggestions made for the re-use of some of the sites, including the appeal site. (2) The preferred central scenario in the Study is based on the draft Regional Spatial Strategy (RSS14) and the Regional Economic Strategy. (3) In this scenario demand for industrial and warehousing space would decline by around 60000sq.m by 2016 and there is an office floor space net demand of about 20000sq m, a net reduction in business space needs overall of 40000sq.m. (4) Furthermore, the existing supply of office land currently identified would last about 10 years i.e. about up until the end of the life of the LP. (5) Beyond that the Study concludes that further new capacity for offices will have to come from any existing industrial land that becomes surplus and that capacity should also be provided to replace any office sites lost to other uses.”

141.	The claimant stressed the last sentence of paragraph 42 of PPG3. That paragraph is quoted in full at paragraph 10 above, but for convenience I set out the last sentence here:

“Local planning authorities should therefore review all their non-housing allocations when reviewing their development plan and consider whether some of this land might better be used for housing or mixed use developments." 

142.	Mr Holgate said that this sentence was particularly relevant, as the draft local plan in 2000 had not included the kind of review contemplated. This had had to await the Employment Land Study of 2004. 

143.	Mr Holgate stressed that paragraph 42 of PPG3 was concerned with the position over the lifetime of the development plan. Paragraph 14 of the Decision Letter said in sentence (4) that the existing supply of office land currently identified would last about ten years. It was accepted by Mr Holgate that the reference to ten years was, as the Inspector saw it, a reference to an end point of 2011, when the local plan expired. 

144.	Mr Holgate added that while the Employment Land Study referred to a “qualitative audit” [chapter six], this did not involve a Policy 14 approach – no one had ever suggested that it did. The study had divided employment sites into those where there was a “commitment” to B1 [office and light industry] use and those committed to B2 and B8 [industrial and warehousing] uses. It was not known how such “commitment” had taken place – it was apparently found in a County Council register. A short fall of office space was found to exist after 2011, but as the Appeal Site was not being treated by the analysis as a B1 site, its use for housing would make no difference to the outcome of the analysis for office space.

145.	The Inspector dealt with this in paragraph 13 of his witness statement as follows:  

“As to the allegations made in paragraph 6 of the Particulars of Claim, I do not accept that I erred in my consideration of the Employment Land Study as suggested.  It makes no significant difference to the overall conclusion of that Study whether Broadmeads is placed in Table 5.1 or Table 5.2 having regard to the uncertainties as to the actual projection of these figures, but also the question of the quality of the sites. As I recorded in Decision Letter paragraphs 15 and 16, the Study in fact identifies the appeal site as the main brownfield site in the District that is currently available for office development and recommends its retention for employment use either in its entirety or as part of a mixed used development.” 

146.	Accepting the last sentence of paragraph 13, Mr Holgate said that the question was whether the site was needed for office development. Secondly, the reasoning in the second sentence was not in the Decision Letter – nowhere did the Inspector say, the Appellant makes this point, but it does not make a difference. The Inspector had failed to deal with the point made in the Council’s study that other sites would become available over the plan period and beyond so that there would be a surplus. Thus his witness statement simply confirmed that he was confused about the evidence. He ought to have dealt with the issues raised by the policies, and in particular, paragraph 42 of PPG3. 

147.	A second complaint about this aspect was that the Inspector had not given reasons on the point, which was a substantial factor in the appeal. 

148.	The third complaint was initially put on the footing that the development plan referred to in paragraph 42 of PPG3 was the adopted local plan. A ten year supply referred to by the Inspector went substantially beyond the end of the development plan for that period, which was only to 2001. Even, if, however, one took account of the draft local plan, the end point would be 2011, the claimant’s criticisms remained good, for the supply of ten years would go through to 2014. There was no draft plan for the period 2011 to 2014. 

149.	A fourth complaint was alternative to the third. This was that the Inspector failed to take into account the following material considerations taking the Study at face value:-

(i)	The Study predicted a shortfall of 20,000 sq.m. for B1 purposes only in the period 2011-2016 and even then only after inflating the requirement figure by 50% as a safety factor;

(ii)	The Study predicted a surplus of B2/B8 floorspace/land of 60,000 m2 up to 2016;

(iii)	The Study concluded that the shortfall post 2011 was "modest" and given "the small scale of most office requirements in East Hertfordshire any deficiency may be met by windfall opportunities" (para. 5.21);

(iv)	There would be 60,000 m2 of B2/B8 floorspace (or land) available for transfer to other uses such as B1 (see 5.17).

Further or alternatively, the Inspector failed to give any reasons in relation to those substantial matters in the appeal.

150.	The next point concerned paragraph 14 of the Inspector’s witness statement. This stated:  

“In paragraph 6.4(iii) it is asserted that the development plan referred to in paragraph 42 of PPG3 is the adopted local plan.  I do not accept this is correct.  The Study is part of the Council’s review of the supply of employment land for the purposes of the emerging Local Plan which was going through the consultation stage.  It would clearly not be practicable to use it for the existing adopted local plan.  It is clear from Decision Letter paragraphs 11 and 15 that the reference in Decision Letter 14 is to the emerging local plan. ”

151.	 Mr Holgate said that the Inspector was wrong to dispute that paragraph 42 of PPG3 refers to the adopted local plan. 

152.	Furthermore, paragraph 14 of the Decision Letter proceeded on the footing that when the Employment Land Study said that the existing supply of office land currently identified would last about ten years this meant until the end of the life of the emerging local plan in 2011. However, that was a misunderstanding of the Employment Land Study. The study recorded in paragraph 1.2 that it had been prompted by proposed changes to PPG3, which would require planning authorities to review their employment land sites, to see how far they were still suitable and needed for employment. If retention was not supported by an up to date review then Employment Land could be considered available for reallocation to housing. Chapter five looked at the planned supply – the net floor space capacity of the land currently identified by the planning system for development or redevelopment for business uses. This planned supply comprised planning commitments recorded by the County Council’s monitoring system. Where the aim was to release enough land to meet positive demand, as was the case for offices, a margin of  50% was added to the forecast net additional demand to provide a margin for uncertainty, choice and frictional vacancy. Where net additional demand was negative, as it was for industrial/warehousing space, the forecast fall in demand was reduced by a third, to avoid a danger that reductions in space might run ahead of reductions in demand, creating land shortages, forcing industries out of the district and reducing choice. Paragraph 5.5 stated as follows:

“By adding these margins to the forecasts provided earlier, we translate forecast market demand into 15-year planning requirement – the amount of land that should be provided comfortably to meet demand from 2003 to 2016.”

153.	The reference in paragraph 5.5 of the study to 2003 showed, said Mr Holgate, that for market balance this document was working from 2003. The oral evidence of Ms Howick updated the position to 2004. As with the table for 2003, the Appeal Site was listed as B2/B8 rather than B1. Consistently with the 2003 start point in paragraph 5.5 of the study, the figure for built office floor space in chapter 3, dealing with local land and property markets, was a figure giving the position at November 2003 (see table 3.1 at paragraph 3.4). The Inspector might, suggested Mr Holgate, have become confused because demand had been taken for the period from 2001. 

154.	Figure 5.2 in the study gave a pictorial representation of the supply and requirement under a scenario covering the 15 year period 2001 to 2016. This incorporated the safety margin. It did not treat the Appeal Site as part of the office supply, so whether the Appeal Site was used for housing made no difference to the analysis of office supply. Immediately below figure 5.2, paragraph 5.15 said that on this scenario the planned office supply would be some 20,000 square metres short of the forecast requirement. However, over a 15 year planning period, this was not a large shortfall: it was roughly equal to the margin added for uncertainty, choice and friction. Furthermore, bearing in mind the small scale of most office requirements in East Hertfordshire, the gap might be filled by windfall sites – which might include mixed use developments and perhaps intensification of existing offices – rather than formal planning allocations. The last sentence of paragraph 5.15 read as follows:

“Besides, even if there are no more windfall opportunities, the supply currently identified will meet the forecast demand for the next ten years or so.”

155.	The reference to the next ten years or so in this passage, said Mr Holgate, must mean from 2003. The methodology was described in paragraph 5.17, which dealt with the negative planning commitment for industrial and warehousing space. Some 60,000 square metres could be lost over 15 years, equivalent to 4,000 square metres per year. Thus the study was taking a total figure envisaged over a period of years, and dividing it by the number of years in order to identify and amount of floor space per year. Ms Howick’s proof of evidence (pages 299 to 300) showed that updating by a year produced the same picture. Thus, when the study recorded at paragraph 7.2 that the requirement to provide a modest 20,000 square metres net of office floor space over and above existing commitments would arise towards the end of the 15 year period, after some ten years, this was after ten years from the date of the study. Mr Holgate claimed that this was how Mr Fairbrass, on behalf of the Council had seen it. For this purpose he cited paragraph 32 of Mr Fairbrass’s witness statement which was as follows:

“On the basis of the above findings, the authors concluded that to meet expected office demand and provide a comfortable margin for choice, uncertainty and friction, over a 15-year planning period there should be additional floorspace opportunities to provide a modest 20,000 sq m net of office floorspace over and above existing commitments, but this requirement would arise only towards the end of the period, after some 10 years (Executive Summary, para 36). Under those circumstances, they further concluded, if future demand for office space is to be met, then the bulk of existing floorspace should either be retained or replaced; and a “key task” of the planning system would be the management of existing employment sites and areas to ensure that enough land is protected from the pressure of higher-value uses and to facilitate the renewal or replacement of space which becomes obsolete (Executive Summary, para 40; CH PE para 2.20).”

156.	Mr Holgate added that this flaw in the reasoning at paragraph 14 of the Decision Letter was carried through to paragraph 19, where the second sentence said “…the study indicates that all of the surplus office land would be used by the end of the plan period and that there is still a need to provide some employment land in the district for that purpose.” If the end of the plan period meant 2011, the study said no such thing. Similarly, the second to last sentence of paragraph 19 referred to predicted surplus of industrial land in the district by 2010, and again the study provided no support for this proposition. 

Ground 3: the defendants’ submissions

157.	The first defendant’s answer on ground 3 began with the “10 year” point – was the Inspector wrong to think that when the authors of the ELS said the existing supply of office land currently identified would last about 10 years they were referring to 10 years from 2001? Mr Strachan drew attention to passages in the ELS which indisputably showed that the study period started in 2001. If the claimant’s “10 year” point had any validity, it would have been a misnomer to describe the ELS as “2001 to 2016”. Acknowledging that paragraph 5.5 of the ELS looked at stock from 2003 onwards, Mr Strachan said this has assumed that stock becoming available in 2001 and 2002 did not meet demand for those 2 years. Table 5.1 had been dealing with the supply from 2001 to 2016 as assessed at 2003. Accordingly, said Mr Strachan, the reference at paragraph 5.15 to “forecast demand for the next 10 years or so” was from 2001. Mr Strachan noted that the proof of evidence of Ms Howick at paragraphs 2.10 onwards examined employment during the period 2001 to 2016.

158.	In any event, said Mr Strachan, even if the “10 year” point were right, the margin of forecasting error made the point insignificant.  

159.	Finally on the “10 year” point, Mr Strachan submitted that it had not been advanced by the claimant at the Inquiry. The claimant’s planning consultants produced a commentary on the ELS. In the schedule to that commentary they had worked by reference to the period 2001 to 20016. Further, said Mr Strachan, the Appellant’s Updated Closing was consistent with the Inspector’s interpretation. Particularly relevant were paragraphs 6.1 and 6.5 as follows:

“6.1…it is accepted in the ELS that there is no shortfall fall…during the plan period to 2011…

6.5. In summary, the following points were made by the Council’s witnesses:-

…

(ii) The office market is in balance. There is no shortfall to 2011;

(iii) The office shortfall relied upon by the Council is only 20,000 sq.m., but this figure:

(a) relates solely to 2011 – 2016;…” 

160.	These three references to “2011” were, said Mr Strachan, plainly references to the “next 10 years” in paragraph 5.15 of the ELS. The Inspector could hardly be criticised for taking the same approach as that of the claimant.

161.	Mr Strachan then turned to the “B2/B8” point, as to which he said that everyone appreciated that the Appeal Site was recorded as B2/B8. It was in that category because as a maltings it was a B2 site. The analysis by Ms Howick was concerned with quantity, not quality – that had been dealt by Ms Hulett. Particular qualities of the site making it suitable for office development and other class B1 uses were recorded by the Inspector at paragraph 16 of the Decision Letter. Ms Howick had explained at paragraphs 3.1 to 3.4 of her proof that over the next 15 years net new capacity for office development would have to be provided from existing industrial land, or intensification of existing sites, unless new land were identified for employment, and accordingly sites such as the Appeal Site which are attractive for office use should be retained and allocated for such use. As the Inspector noted in paragraph 13 of his witness statement, the inclusion or non-inclusion of the Appeal Site in the existing allocated B1 commitments created no significant difference having regard to the inherent uncertainties of the figures generally. 

162.	The criticism of lack of reasoning fell away, said Mr Strachan, as matters he had identified earlier showed that it was based on a false premise. As to the suggestion that paragraph 42 of PPG3 focused on the adopted plan, this was clearly unfounded: the paragraph advised Local Planning Authorities to review all their non-housing allocations “when reviewing their development plan”. This was plainly a reference to the emerging Local Plan Process.

163.	Ms Busch on behalf of the Council adopted Mr Strachan’s submissions on this aspect. 

Ground 3: the claimant’s reply

164.	In reply Mr Holgate said that if the Council had really been saying at the Inquiry that the existing supply of office land would be exhausted by 2011 one would have expected that to have been in a written proof of evidence and in the Respondent’s Written Closing. Yet it was not, and the Inspector did not identify a source for these vital findings. Neither the Inspector nor Mr Fairbrass suggested that this was a new point. The Appellant’s Updated Closing had focused on 2011 because PPG3, paragraph 42, was directed to the Local Plan Period – the claimant was saying that PPG3 Paragraph 42 did not require it to go beyond 2011. The proof of evidence of Mr Parsons was consistent with this, and in the last bullet point of paragraph 10.6 he had referred to the 10 year period citing paragraph 5.21 of the ELS. Mr Holgate said that so long as his interpretation was tenable, and no one at the Inquiry had said to the Inspector that he should understand the 10 year period to expire in 2011, the claimant had a valid criticism that the Inspector ought to have raised with the parties before arriving at his interpretation, and ought to have explained his reasoning. 

165.	On the “B2/B8” point, the Inspector had simply not dealt with it in the Decision Letter. Even in his witness statement he did not address the basic question – why did the site need to be retained in quantitative terms, given that the commitment figures did not treat it as an office site? Further, there was no reasoning in the Decision Letter which said that purely because of its qualitative value this site must be retained for employment. 

Ground 3: Analysis

166.	On the “10 year” point, it seems to me impossible for the claimant to complain at the fact that the Inspector took 2011 as the date after which the office market would no longer be in balance and the date from which there would be a shortfall on the Council’s case. That is because the Appellant’s Updated Closing at paragraphs 6.1 and 6.5 (2) (3) (a) constitutes an express acknowledgment by the claimant that this was the Council’s case. Mr Holgate suggested that 2011 had been specified because the Council had made reference to the period of the ELP. Even if right, this would not affect the matter: for whatever reasons, the Appellant’s Updated Closing invited the Inspector to proceed on the basis that the Council’s case involved a shortfall from 2011 onwards. If Inquiries are to be run efficiently an Inspector must be entitled, when preparing the Decision Letter, to work on the footing that absent obvious error, the Appellant’s Updated Closing set out the claimant’s case. There was no reason for him to think that paragraphs 6.1 and 6.5 involved obvious error.    

167.	Additionally, it seems to me that the reference to “for the next 10 years or so” in the ELS can hardly be regarded as a particularly precise assertion. If the claimant wished to button this down to 2014 rather than 2011, then it was for the claimant to elicit this in cross-examination. Indeed in paragraph 14 of the Decision Letter the Inspector himself was not particularly precise – his words were, “about up until the end of the life of the LP.” In this context, given the substantial margin for error, the difference between 2011 and 2013 or 2014 is unlikely to have been significant – on any view, the Council accepted that during the plan period a shortfall would not arise.

168.	The “B2/B8” point has greater merit. It was squarely taken at paragraph 6.5(iv) of the Appellant’s Updated Closing. It is nowhere addressed in the Decision Letter. Mr Strachan may be right when says that everyone was aware that the Appeal Site had a recorded commitment for B2 use. Even so, I do not understand how it can be thought irrelevant that the ELS proceeded on the footing that the Appeal Site had not been committed for office use. This point has real significance when it is appreciated that the ELS also concludes that land committed for office use will be sufficient at least until 2011. At the very least, it seems to me that the claimant was entitled to an explanation of why the Inspector thought that the Appeal Site should be retained for office use when on the Council’s own case there was sufficient other land designated for office use at least until the plan period expired in 2011. 

169.	For these reasons I conclude that ground 3 succeeds.

Ground 4: The Employment Land Study

Ground 4: the claimant’s submissions

170.	Paragraphs 18 and 19 of the Decision Letter were as follows:

“18.  The methodology used in the Employment Land Study has been criticised on a number of grounds by the Appellant.  These include the unclear translation of county-wide statistics to the district level, the inconsistent use of regional and district housing and employment projections, and that the conclusions are based upon assumptions and judgments.  It is also said that some important employment sites are ignored.  I agree there are some shortcomings in the Report, but it appears to be the best information available and, in my view, the criticisms do not significantly affect its general applicability to this appeal.”

19.  I acknowledge that the market for office development in Ware is small compared with neighbouring towns and that there is full employment in the area. But the study indicates that all of the surplus office land would be used by the end of the Plan period and that there is still a need to provide some employment land in the District for that purpose. Any such provision would also assist in minimising commuting out of town and in catering for the rising population. Whilst there may be a predicted surplus of industrial land in the District by 2010, the current position seems, from the study to be much tighter than that, with little surplus available. Furthermore, the Council has earmarked anticipated surplus employment land for development for mixed use in the LP Review.”

171.	Ground four of the particulars of claim concerned the Employment Land Study and the way in which the Decision Letter dealt with it in paragraphs 18 and 19. Here the particulars of claim made a serious of complaints. For convenience, I group them under five headings.

172.	The first and second heads of complaint concerned concessions by the Council’s witnesses as to the validity of criticisms of the study. The first head of complaint said that the Inspector failed to take into account as a material consideration each such concession. The second head of complaint was that he had failed to give reasons in relation to these matters, each of which was a substantial matter raised at the Inquiry.

173.	Eight concessions were relied upon. Each of them was set out, in some cases with commentary, in the claimant’s written closing submissions. 

174.	Concession 1 was described in paragraph 6.1 of the Appellant’s Updated Closing:

“The study claims (see paragraph 1.1) that the brief from the Council was for RTP to produce a document which would inform policy in the forthcoming Local Plan and further Local Development Frameworks.  Mrs Howick accepted, however, that the January 2004 brief merely referred to the Second Revision of the Local Plan with its end date of 2011 and that the brief did not contain any reference extending to 2016.  This is significant because it is accepted in the Employment Land Study that there is no shortfall on RTP’s statistics during the Plan period to 2011.  That fundamentally undermines any attempts to refuse development for alternative uses by reference to the emerging Local Plan.”

175.	Concession 2 was set out in paragraph 6.2 of the Appellant’s Updated Closing:

“Despite the request made on the first day of the inquiry no further documents or evidence has been produced by the Council to explain why RTP’s study went beyond the remit of the January 2004 written brief to cover the period 2011-2016.”

176.	Concession 3 was described in paragraph 6.3 of the Appellant’s Updated Closing:

“There is a serious inconsistency in the Council’s case. On the one hand it relies upon draft RSS14’s employment proposals to support RTP’s study (but only in relation to the period 2011-2016 so far as this appeal is concerned) and yet does not accept or even deal with housing requirements in RSS14 for the post 2011 period. Yet the Council’s policy witness and RTP accepted that consideration of housing and employment needs must go together. No weight can be attached to the Council’s reliance on RSS14 to support the employment land objection because (i) the Council recently rejected the recommendations of the local plan inspector as to additional housing sites at Bishop Stortford and (ii) the evidence based upon past experience and recent statements from Council members is that the Council will oppose the RSS14 housing figures. On that basis alone the reasons for refusal here cannot be supported. Mr. Thomsett claimed that the Regional Office’s comments on the draft local plan had supported the Council’s approach to housing policies. However, when the letter was produced it appeared that it had been written in 2001 and had been commenting on the 2000 deposit draft, which, obviously, had not taken on board 2004 draft RSS14.”

177.	Concession 4 was at paragraph 6.4 (iii) of the Appellant’s Updated Closing:

“In summary, the following points were made by the Council’s witnesses:-

…

“(iii) RSS14 gives employment figures for counties but not individual districts. There is no explanation in the RTP document as to how the Hertfordshire County figure was disaggregated to produce an East Herts District figure. Mr. Thomsett did not ask for that explanation. The members of the Council who approved the RTP study were not aware of the basis for distributing employment requirements to East Herts District and therefore it is impossible to test whether the Council agrees with the assumptions and judgments made by RTP. These views of RTP have yet to be set out transparently and tested;”

178.	Concession 5 was described at paragraph 6.4 (iv) of the Appellant’s Updated Closing:

“In summary, the following points were made by the Council’s witnesses:-

…

The RTP study does not comply with paragraph 42 of PPG3;”

179.	On this, the particulars of claim cross-referred to paragraphs 4.1 and 4.2 of the Appellant’s Updated Closing, which read as follows:

“4.1 PPG3 paragraph 42

It was agreed by Mr Thomsett that this paragraph is a material consideration. 

The first sentence raises the issue of whether employment allocations will “realistically” be taken up during the lifetime of the development plan. “Realistically” reflects the test laid down by the House of Lords in Westminster City Council v BWB (1985) A.C. 676. The statutory development plan runs to 2001. The redeposit draft plan runs to 2011. The Council’s case accepts that the site is not needed for employment purposes up to 2011.

Secondly, the second sentence in paragraph 42 is applicable because planning policies have changed since the EMP2 sites were designated, in particular the new Structure Plan Policy 14 adopted in 1998.  He also agreed that the following sentence would be applicable in as much as the site is previously developed land.  He finally accepted that the last sentence of paragraph 42 applies in this instance.  In the course of cross-examination of Mr Parsons it was suggested that the September 2004 Employment Study by RTP complies with the last sentence of paragraph 42.  In particular it was suggested that this was a study that purported to comply with that sentence.  Obviously that requirement is not satisfied by a document which merely ‘purports’ to comply with paragraph 42; what matters is whether it does in substance fulfil the requirements.  Paragraph 42 requires the Planning Authority to consider whether some of the allocated employment land might be “better used” for housing or mixed use developments.  The RTP study did not address housing needs and their relative importance as compared with employment needs at all.  For that reason alone the 2004 study does not even “purport” to comply with paragraph 42.

4.2 Mr Thomsett accepted that it should have been obvious to the Council from March 2000 that a proper Employment Land Study was required.  In fact, nothing was commissioned until 2004, and even then neither the document produced nor the Council’s Committee Report in September 2004 nor the December 2004 Redeposit Draft involved any exercise to compare housing and employment land needs.”

180.	Concession 6 was described at paragraph 6.4(v) of the Appellant’s Updated Closing:

“In summary, the following points were made by the Council’s witnesses:-

…

RTP prefer the central scenario based on RSS14, but recognise (para. 4.7 of Study) that this is consistent with population growth and distribution which is policy driven (i.e. draft policy in RSS14). Paragraph 10 of the Executive Summary makes it clear that 31,200 jobs is a labour supply figure (and see for confirmation para. 4.44 of Thomsett), whereas 64,700 (the central scenario) is based upon RSS14. The difference between the two figures, 33,500 jobs, is policy driven. If the Council is to object to the housing figures in RSS14 then the employment requirements should also be reduced, if substantial in-commuting is to be avoided.”

181.	Concession 7 was described in paragraph 6.5 of the Appellant’s Updated Closing:

“ 6.5 Evidence on need

In summary, the following points were made by the Council’s witnesses:-

(i) The Council’s case on employment need on the appeal site is limited to offices, and does not include B1(c), B2 or B8;

(ii) The office market is in balance. There is no shortfall to 2011;

(iii) The office shortfall relied upon by the Council is only 20,000m2, but this figure:

(a)	Relates solely to 2011-2016;

(b)	Assumes that RSS14 is approved both as to employment and housing figures;

(c)	Assumes the addition of a safety margin of 50% to the requirement figures, without which (and without any other adjustment) there would be no shortfall at all even to 2016;

(d)	Disregards any contribution to office requirements from surplus industrial/warehousing land/floorspace, which RTP assess to be 60,000m2 (after deducting a ⅓ safety margin). That net surplus far exceeds the office requirement figure of 20,000m2;

(iv)	In the Schedules of floorspace, Broadmeads has been included by the Council/RTP as a B2/B8 site, not as a B1 or B1(a) site. Thus, even if the appeal site were to be released for housing, there would be no difference at all to the supply of sites to meet office needs and no significant difference to the supply of employment land sites.

Consequently, Mr. Parsons was correct to state that even if the RTP study is taken at face value, there would be no adverse effect on the supply of employment land now or for the future if the appeal were to be allowed.”

182.	The conclusion which the claimant derived from these concessions was set out in paragraph 6.6 of the Appellant’s Updated Closing:

“For the above reasons, the Council’s reasons for refusal should be rejected without needing to go into the evidence on viability of office development on the appeal site and the issue of whether office development is a “realistic likelihood”.”

183.	In oral submissions on concessions 1, 2 and 3, Mr Holgate summarised the inconsistency relied upon. Essentially, the point was that additional offices and additional housing go hand in hand. On concession 7, Mr Holgate accepted that there might be scope for argument in relation to paragraph 6.5 (i) of the written closing submissions. In that regard, the Council might dispute that it had conceded that its case on employment need at the Appeal Site did not include category B1(c). However, there was no dispute that the Council’s case on employment need at the Appeal Site did not include categories B2 or B8. 

184.	Turning to how the Decision Letter had dealt with these matters, Mr Holgate said that the only reference to them was in paragraph 18, and was in such vague terms that the claimant simply did not know if the Inspector agreed with the concessions. If he did not agree with them, it did not know why not. If he did agree with the concessions it did not know how much weight he gave to them. Paragraph 18 of the Decision Letter had not even stated that the Council accepted these criticisms. It did not say that the Council did not know how the apportionment was reached. 

185.	As to the Inspector saying that the study appeared to him “to be the best information available”, Mr Holgate was prepared to assume for the purposes of argument that this was correct. However, what the Inspector should have been asking was, “is it good enough?”

186.	At the end of paragraph 18 of the Decision Letter the Inspector said that the criticisms of the study, “do not significantly affect its general applicability to this appeal.” Mr Holgate described this as meaningless waffle. The claimant had made serious points which went to the robustness of the study and the Inspector had not dealt with them.

187.	In paragraph 18 of his witness statement prepared for these proceedings Mr Fairbrass said that the claimant at the Inquiry had accepted that the study constituted a review of the kind required to be undertaken by paragraph 42 of PPG3. Mr Holgate said that any such assertion could not stand with the passages from the claimant’s written closing submissions cited above.  Indeed, in paragraph 44 of that witness statement Mr Fairbrass had accepted that the criticisms based on concessions 1, 3 and 4 were made. On these, Mr Fairbrass set up as responses:

Concession 1:

“LPA response: First, this “criticism” did not indicate that the methodology employed in or the conclusions of the ELS were in any respects flawed. Second, the authors of the LPA had engaged in discussions concerning the ELS from an early date, in the course of which the authors had made it plain that they proposed to consider the period to 2016, and the LPA had accepted this approach, irrespective of the time-period set out in the Project Brief.”

Concession 3:

“LPA response: Once again, first, this criticism did not serve to undermine the ELS’s methodology or conclusions. Second, merely because the LPA intended to oppose the RSS14 housing figures, it did not follow that it was not entitled to rely upon the findings of the ELS as regards the future need for employment land, or upon the recommendations contained therein and based upon the Central Scenario, as providing it with good reasons to seek to retain the Appeal Site for employment uses.”

Concession 4;

“LPA response: As the ELS’s authors informed the Appellant in response to the latter’s pre-Inquiry questions, the manner in which the relevant numbers and breakdowns were reached is set out in the technical Appendix that Roger Tym & Partners produced alongside the RPG14 alignment study, and is readily available on the East of England Regional Assembly website.”

188.	The response on concession 4, said Mr Holgate, did not deal with the claimant’s point. It had sought an explanation from the authors of the study as to how the desegregation had been produced.  Mr Thomsett, the Council’s officer responsible for policy formation, had not asked for that explanation and did not know it. That meant that it was impossible to know whether the Council agreed with the assumptions and judgments made in the study. This failure by Mr Fairbrass in his witness statement for these proceedings echoed a failure of the Inspector in the Decision letter. 

189.	On concession 5, Mr Fairbrass’s witness statement for these proceedings said at paragraph 47:

“This point did arise for discussion during the course of the Inquiry. Specifically, the point that was put to Ms Howick by the Appellant’s representative in his cross-examination of her was that the removal of the Appeal Site from table 5.2 would not change the conclusions set out in the ELS with respect to B2/B8 land supply. Ms Howick’s response was that this was strictly speaking correct, in that, if the Appeal Site alone were removed and nothing else, there would not be a huge difference in the final conclusions, but that the same argument applied to other sites, so that if the removal of the Appeal Site from the list could be justified on this ground, so could the removal of any other site. No reference was made to this point in the Appellant’s closing submissions, indicating, therefore, that it was without merit and that the Appellant’s criticisms of the ELS were made on the grounds, namely, those set out above.”

190.	This, said Mr Holgate, did not deny the accuracy of paragraph 6.5 (iv) of the Appellant’s Updated Closing. In the second sentence, Mr Fairbrass must be intending to refer to table 5.1, not table 5.2. The remainder of paragraph 47 of his witness statement for these proceedings simply did not meet the claimant’s point. 

191.	Head three of complaint concerned paragraph 19 of the Decision Letter. This is set out at paragraph [44] above. The fourth sentence contrasted the expected surplus of industrial land in the district by 2010 with the current position, saying that the current position was “much tighter…with little surplus available.” There was no evidence, said the claimant, to support this assertion by the Inspector. The surplus of 60,000 square metres of B2/B8 purposes predicted for [2016] was a figure reached after deduction of a one third safety margin. The study had not suggested that the surplus was tighter than that figure either before 2010 or even in the extended period of analysis up to 2016. 

192.	The Inspector’s witness statement commented on this part of the particulars of the claim in paragraph 16, which read as follows:

“At paragraph 7.3 of the Particulars of Claim criticism is made of my observation in Decision Letter paragraph 19 that the current position for industrial land appears to be very much tighter than that for 2010.  I do not understand the allegation that there was no evidence to support my observation.  It does in fact reflect table 5.2 which clearly shows that existing commitments are currently offset by losses where sites have been earmarked for other uses.  The Study shows a significant decline in market demand for industrial land in the future, and as a result the surplus becomes much larger and reaches 60,000 sq m by 2016 (as identified in my Decision Letter paragraph 14).”

193.	Mr Holgate said that this paragraph in the Inspector’s witness statement was incomprehensible. The study showed a surplus of industrial land because of a reduction in demand for that use. There was no evidence of a shortage of industrial land currently, or a “tight” situation. Indeed, the Inspector in his witness statement referred to the current surplus becoming larger. It was still currently a surplus. The increase in supply could be seen in the update provided by Ms Howick. The ELS figure in table 5.2 for B2/B8 planning commitments, as at 2003, was a net loss of 639 square metres. By contrast, as at 2004, appendix 1 to the proof of evidence of Ms Howick gave a figure of 2,286 square metres surplus. The Inspector’s observations about this had simply missed the point. 

194.	Heads of complaint 4 and 5 identified four material considerations militating against taking the Employment Land Study at face value. Under head 4, the claimant said that the Inspector had failed to take these matters into account. Under head 5, it was said that the Inspector failed to give any reasons in relation to these matters.

195.	The first material consideration was that the Study predicted a shortfall of 20,000 square metres for B1 purposes only at some point during the period 2011 to 2016, and even then only after inflating the requirement figure by 50% as a safety factor. The second was that the Study predicted a surplus of B2/B8 floorspace/land of 60,000 square metres up to 2016. Thus paragraph 5.17 of the Study, dealing with figures as at November 2003, said:

“For industrial and warehousing space yet again the forecast loss in demand is not matched by negative planning commitments. There is room for transferring land to other uses over and above existing commitments, but the floorspace capacity that can be lost is …some 60,000 square metres over 15 years, or 4,000 square metres per year.” 

196.	Appendix 1 to Ms Howick’s proof of evidence said that the revisions for 2004 figures had an insignificant effect. 

197.	The third material consideration was that the study concluded that the shortfall after 2011 was “modest” in paragraph 5.21, and added “any deficiency may be met by windfall opportunities, including mixed developments at the intensification existing office sites, without a need for formal planning allocations.”

198.	The fourth material consideration was that there would be 60,000 square metres of B2/B8 floorspace [or land] available for transfer to other uses such as B1 [see paragraph 5.17, quoted above].

199.	Generally, Mr Holgate said that where there was a failure by the Inspector to mention a particular point, this warranted the conclusion that he did not take that point into account. Where the Inspector mentioned a point, but what he made of it was unclear, then his reasons were inadequate. 

Ground 4: the defendants’ submissions

200.	The first defendant said that the Inspector did not need to delve into every criticism. The claimant had not suggested any alternative Employment Land Study, nor had it suggested any alternative figures. The Appellant’s Updated Closing on these aspects was entirely directed to the quantitative analysis, no points of contention were raised with the qualitative analysis. Paragraph 19 of the Decision Letter had set out those matters which the Inspector derived from the Employment Land Study. The Inspector concluded elsewhere in the Decision Letter that there was a realistic prospect of the site being developed for employment use within the plan period. This conclusion could not be materially affected by the detailed points of criticism that were being made of the Employment Land Study by the claimant. 

201.	Ms Busch adopted these submissions. She added that Mr Parsons on behalf of the claimant had accepted in paragraph 1.2 of his proof that the ELS was an assessment of employment land requirements, and in paragraph 10.9 had sought to deploy the results of the ELS. 

202.	As to the current position being tighter than 2010, this was supported by the analysis in table 5.2 of the ELS. This showed the position of land supply for B2/B8 purposes as at 2003, with indeed little surplus available. Gains in terms of allocated lands were offset by losses for land earmarked for other purposes, as identified in paragraph 5.10 of the Study. This justified a comment that the current position was in fact one of tight supply, albeit that over the plan period supply would increase as demand fell for office space and other sites became available. 

Ground 4: the claimant’s reply

203.	In reply Mr Holgate said that there had been no dispute that the concessions in question were made. The reader of the Decision Letter, however, could not tell which of those concessions were accepted by the Inspector and which was not. This aspect, he said, had not been addressed by the first defendant. 

Ground 4: Analysis

204.	As to the conceded weaknesses in the Employment Land Study, it seems to me possible that the Inspector may have accepted all of them and nevertheless reached the conclusions which he describes in the Decision Letter. On the other hand, it appears to me equally possible that he regarded some of the claimant’s criticisms as unsound, and for that reason was able to arrive at certain of his conclusions. The difficulty is that a reader of the Decision Letter cannot tell which of these is the case. This is a real difficulty, causing real prejudice to the claimant for two reasons. First, the claimant cannot assess the extent to which the Inspector is giving reduced weight to the Employment Land Study unless it knows in general terms what matters the Inspector considers give rise to such reduced weight. There is a contrast here with paragraph 11 of the Decision Letter. There the Inspector has identified the way in which the LP is out of step with the SP. Accordingly, it is possible for the reader to identify the nature of the reduction in weight, and in turn see how this has a knock on effect. Second, as long as it is possible that some criticisms have been rejected, without knowing which those criticisms are it will be impossible for the claimant to know whether there is reason to think that the Inspector has erred in law in relation to a material consideration.

205.	I stress that I am not in this regard placing any great burden on the Inspector. He will have applied his mind to the criticisms. He may have accepted them all. He may have taken the view that he rejected one or more of them. As regards one or more of them, he may have concluded that even if he were to accept them this would not affect his conclusion on relevant points. It is no great burden on the Inspector, and is only fair to the claimant, that he should record which of these is the case.

206.	On the subsidiary point concerning the Inspector’s comment about the current situation being tighter than 2010, the points made by Mr Strachan and Ms Busch were in my view a complete answer to those of Mr Holgate. There was no real attempt by Mr Holgate to counter them in his reply. 

207.	However, for the reasons given above, the claimant succeeds on the main point under ground 4.

Ground 5: The Viability Study

Ground 5: the claimant’s submissions

208.	In paragraphs 20 to 21 of the Decision Letter, the Inspector said:

“20. At the Inquiry the Appellant presented estimates of the cots of an office and mixed use development of the site, which purported to demonstrate that either project would not be economically viable, largely because of the low rent and limited demand for office space in Ware. The Council rightly complained about the shortage of time to consider the document, but was not able to challenge the methodology at the time.

21.  From my consideration of the case I can find no explanations of how the figures were derived or other commentary on the results or their implications. However, it is possible to infer from the calculations that even if the higher Hertford rental rate of £18 pfs were used an office development would still make a loss. If accurate these estimates also cast doubt on the viability of any quality office scheme in Hertfordshire, even allowing for the additional construction costs of this site. Moreover, the analysis relies on a comparison of rented office space versus residential accommodation that would be sold on the open market, without further explanation of how the retained capital value of the offices would be handled beyond the chosen rental period, for instance. Nor does it take account of any fluctuations in the economic cycle or the possibility of other non-housing forms of development in conjunction with office development. I therefore give the document little weight.”

209.	Mr Holgate observed that there was no obligation on the claimant to show at the Inquiry that the Local Planning Authority’s preferred use was unlikely, but it was open to the claimant to do so. In paragraph 42 of PPG3 the test to be applied is whether there is a realistic prospect of the site being developed for employment purposes during the plan period. That was similar to the approach taken by the House of Lords in Westminster City Council v. British Waterways Board [1985] AC 676. 

210.	It was necessary for the Planning Authority to show that the land will be used for the intended use. The standard of proof was the balance of probabilities, not in the strict sense of 51%, however, as the law had moved on. 

211.	The first sentence of paragraph 20 of the Decision Letter was not, said Mr Holgate, a full account of the points made in the viability study. These points included the fact that the Appeal Site was in a conservation area, that it was expensive to develop, that rents achievable in Ware were low, and in Ware there was only 14,000 square metres of office space turnover per year. Eventually, the Council had claimed that the office space they envisaged could be let over a period of four years.

212.	The final sentence of paragraph 20 referred to a shortage of time for the Council to consider the document, and an inability to challenge the methodology at the time. This was amplified in paragraph 17 of the Inspector’s witness statement, which was as follows:

“Under paragraph 8 the claimant makes criticisms of my findings in respect of the viability study. The viability study was delivered to the Council at approximately 6pm the night before the inquiry commenced and I was not provided with it until the inquiry commenced. As my decision letter and costs decision letter record, the Council rightly complained about the shortage of time to deal with the document, but chose not to apply for an adjournment.  The Council dealt with the study in evidence and in closing submissions.  ”

213.	As to this, the claimant’s skeleton argument said that the Council made it clear at the Inquiry that they would not seek an adjournment. That was a matter for them. If they felt prejudiced by the timing of the document then the obvious course was to ask for an adjournment. That they did not do so should not be taken against the claimant. In any event both parties discussed the document outside the Inquiry on Day 1 and it was dealt with by the Council’s witness on Day 2.

214.	Mr Holgate said that there had been good reason for late production of the document. For the purposes of the proceedings in this court it does not seem to me necessary to go into the rights or wrongs of that contention.

215.	The first head of claim under ground 5 concerned alleged concessions by Ms Hulatt summarised at paragraph 6.8 of the Respondent’s Written Closing. This paragraph read as follows:

6.8  The evidence produced by the Appellant does not show that office development can never be viable anywhere in East Herts. Instead, it shows why office development on this site in Ware is unrealistic. In summary, the reasons, which are not in dispute (see the cross-examination of Ms. Hulatt) are as follows:-

(i)  The valuation method put forward by the Appellants is correct and there is no dispute as to the inputs;

(ii)  The office market in Ware is local and is handled by local agents. The rents there are low (£12 psf) compared to Hertford (£17 psf). The rents are low because of a lack of demand relative to the size of the existing supply;

(iii)  The annual turnover, or “churn” of floorspace is estimated by RTP to be only 1400 sq.m. Vacancy rates are higher than County or other local averages;

(iv)  There have been no office developments in Ware of 5000 or 7000 sq.m. over the last 10 years or so;

(v)  Ms. Hulatt therefore envisages that it would be necessary to phase any office development over 4 years. However, she accepts that on that assumption the supply of office accommodation coming to the market would double during that period and that, in these circumstances, it would be unrealistic to assume any real increase in rental levels above £12 psf for the foreseeable future. By contrast build costs may increase;

(vi)  If there were to be an upturn in the regional economy demand would go to sites well located in relation to the primary road corridors which define the office markets (i.e. A1, M1, M11) not Ware;

(vii)  There is no evidence that office demand would increase in Ware because supply is constrained. Instead, office rental levels in Ware would need to be much higher in order to support the costs of development. For that to happen there would need to be a “fundamental shift” in the market and not just a “general upturn.”

These points, which were accepted by Ms. Hulatt, negate any suggestion that office development of about 5000 sq.m. might take place on a single site in Ware because of a ripple effect. There is no evidence to show that there is a “realistic likelihood” (see PPG3) of such development occurring.

All the above is reinforced by the views of a local agent with long, local experience, Mr. Davies (App. 13 of Parsons). That evidence has not been challenged.”

216.	Mr Holgate said that these concessions were not disputed. The failure on the part of the Inspector to mention them was relied on as showing that he had failed to take them into account. Alternatively, he had failed to give reasons in relation to those matters, which were substantial factors in the appeal. 

217.	The claimant also sought to rely upon a further concession. This was described in paragraph 12 of Mr Parson’s first witness statement. He said that he heard Ms Hulatt confirming in cross-examination that although the Employment Land Study had recommended that the Broadmeads Site should be retained for employment development, the consultants had not assessed the viability of such a redevelopment scheme or a mixed use scheme. This, said Mr Holgate, had not been contradicted or dealt with in the Inspector’s witness statement.

218.	The second head of complaint on ground five was that there was no evidence upon which the Inspector could suggest, as was implicit in the first sentence of paragraph 21 of the Decision Letter, that there was no explanation of how the figures were derived or “other commentary on the results or their implications.” Generally, the claimant contended that it was common ground that the method used was a standard valuation method. As to how the figures were derived, Mr Holgate pointed to the first page of the viability study. I set this out below, and in the remainder of this judgment will refer to the material which followed the heading “Sources” as “the Footnotes”.

“BROADMEADS, WARE

Viability Study for 100% offices

Assumption

1. Net lettable:	500,000 square feet	
2. Gross build:	60,000 square feet	
3. Land value:	650,000 per acre	
4. Yield:	8 ½% (12 Y.P.)	
5. Build cost:	£130 per square foot	
6. Site clearance costs:	£50,000	
7. Professional fees:	15% of build costs	
8. Interest costs:	6 ½% per annum	
9. Build period:	2 years	
10. Void:	6 months no letting after building completed	
11. Letting period:	3 years after building completed 
(optimistic assumption)	
12. First occupation:	2 ½ years after start on site	
13. Office rental:	£12 pfs	

Sources
1. Based on King Sturge evidence para 4.13
2. Based on King Sturge evidence para 4.13
3. Local agent – Davies & CO
4. Local agent – Davies & CO
5. Quantity Surveyor – Monroe White & Hilton
6. Quantity Surveyor – Monroe White & Hilton
7. Quantity Surveyor – Monroe White & Hilton
8. Bayfordbury Estates – bank rate + 1.75%
9. Bayfordbury Estates
10. Bayfordbury Estates
11. Bayfordbury Estates. Assumes no rent free period
12. Bayfordbury Estates
13. King Sturge”

219.	Commenting on this, Mr Holgate said that items 1, 2 and 13 had come from the Council itself. Items 3 to 7 were from experts. Thus in relation to all items there was an explanation of from whom they were derived, and in three cases they were derived from the Council. In relation to “abnormals” – that is, additional costs which will not normally be expected for an office development – a separate document had been provided to the Inspector giving a breakdown of the total sum of £546,850. Other material on the building costs had been supplied by the quantity surveyor. In cross-examination witnesses had said that there was no disagreement about the methods used, and there was no disagreement about yields. Neither the Inspector’s witness statement nor that of Mr Fairbrass disputed these matters. The first sentence of paragraph 21 was, in this regard, inexplicable. 

220.	The third head of complaint under ground 5 was that there was no evidence upon which the Inspector could suggest, as he had done in the third sentence of paragraph 21 of the Decision Letter, that the claimant’s estimates cast doubt on the viability of any office development in Hertfordshire. Instead, the claimant contended that the viability study was directed to the agreed low level of rental income which could be achieved for modern offices in Ware, against the abnormally high costs of developing the Appeal Site. 

221.	The Inspector responded to this contention in paragraph 19 of his witness statement as follows:

“…at Decision Letter paragraph 21 I refer  to the fact that if the viability study calculations were accurate, even if the higher Hertford rental rate of £18 pfs were used, an office development would make a loss even allowing for the additional construction costs of this site.  Hertford was the County town with the highest level of office rents in East Hertfordshire (as identified in paragraph 3.6 of Ms Hulatt’s proof of evidence).  It is therefore self evident that on this basis there would be some doubt about the viability of any quality office scheme in Hertfordshire.”

222.	This paragraph in the Inspector’s witness statement was said by Mr Holgate to be implausible. It made the facile assumption that rents in Hertford must be the highest in the County because it was the “County Town”. The evidence was that Hertford was a small, local office market. The greatest demand was located elsewhere in the County, as appeared from chapter three of the Employment Land Study dealing with the local land and property markets, the first part of which dealt with offices. Overall on this head of complaint, Mr Holgate submitted that the Inspector had not said that the claimant’s material was “just gratuitous”, and further submitted that what the Inspector said could not square with the Council’s witnesses having accepting methodology and yield. 

223.	The fourth head of complaint under ground 5 focused on the fourth and fifth sentences of paragraph 21 of the Decision Letter. The reference to relying on a comparison of rented office space versus residential accommodation was, said Mr Holgate, bizarre. The viability study had presented two options. The first was for 100% office development, while the second, described as “Viability Study for 50:50 scenario” was looking at joining both types of development. No questions were put to the claimant’s witness and no issues were raised about the alleged failure of the viability study to deal with other non-housing forms of development in conjunction with office development on the Appeal Site or fluctuation in the economic cycle. The same was true of “how the retained capital value of the offices would be handled beyond the chosen rental period” – a phrase which was said by the claimant to be incomprehensible. 

224.	Taking these in turn, as to non-office development, paragraph 20 of the Inspector’s witness statement said that Ms Hulatt had been asked in re-examination whether the site could also accommodate light industrial buildings which have a low vacancy rate, and she stated that it could if the buildings were suitable for a residential and conservation area. This, said Mr Holgate, did not contradict points made by the claimant under this head. As to fluctuation in the economic cycle, paragraph 21 of the Inspector’s witness statement said that the failure of the viability study to take account of any fluctuation in the economic cycle was a point made in the Council’s submissions. Again, said Mr Holgate, this did not contradict the points made by the claimant under this head. As to the question of how the retained capital value of the offices would be handled beyond the chosen rental period, paragraph 22 of the Inspector’s witness statement said this:

“In Decision Letter paragraph 21, I have also set out my conclusion that the viability study analysis relies on a comparison of rented office space versus residential accommodation that would be sold on the open market, without further explanation of how the retained capital value of the offices would be handled beyond the chosen rental period, for instance.  The office space was to be rental and the houses to be sold on the open market and I could not see that the two things compared very easily and I found no explanation of how these figures were derived or any other commentary on the results or implications within that study. ”

225.	On this last point in particular, and on this head in general, Mr Holgate said that if the Inspector found that there was something in the viability study which he found difficult to understand he should have asked for an explanation or clarification. If a point occurred to him after the inquiry, he could write to the parties, or reopen the inquiry. Mr Parson’s second statement in these proceedings at paragraph 13 made the point that the Inspector had the opportunity to clarify with him any matters upon which he was unclear. Further, the author of the viability study, Mr Barham, was at the inquiry and specifically made himself available to answer any questions on the viability study. At paragraph 14, Mr Parsons confirmed that the Inspector had not asked him for any explanation in relation to the handling of “the retained capital value of the offices” beyond the chosen rental period. Nor did the Inspector ask Ms Hulatt to comment on that matter. In paragraph 15 he said that if the Inspector had raised this point, it could have been easily explained that the rental figure put forward by Ms Hulatt for an office development of the Appeal Site (£12 per square foot) had been converted in the viability study to a capital value by the application of a yield, thereby placing the residential and office valuations on a comparable basis. Paragraph 17 added in relation to other non-housing forms of development that if asked, he would have explained that based on his professional and personal knowledge of the town of Ware there were no other uses that would generate a comparable value to housing. In fact, Mr Thomsett had been asked this question in cross-examination and had given the same answer.

226.	The fifth head of complaint concerned the Inspector’s observation in paragraph 20 of the Decision Letter that there had been a shortage of time for the Council to consider the viability study and it had not been able to challenge the methodology at the time. However, said the claimant, the Council had chosen not to apply for an adjournment, and had had the benefit of a period overnight in which to consider the document and to seek clarification from the claimant’s representative. These comments by the Inspector were therefore misconceived, but they appeared to have contributed to his decision to attach little weight to the viability study, and in the circumstances this was said by the claimant to be improper. 

227.	The sixth head of complaint under ground 5 was that the Inspector had simply relied upon the three matters set out in paragraphs 20 to 22 of his witness statement without taking into account the unchallenged concessions by the Council’s witnesses identified in the first head of complaint under this ground. Thus, by way of example, the Inspector’s point about the viability study not taking account of any fluctuation in the economic cycle [paragraph 21 of his witness statement] was dealt with by the concession on the part of the Council that if there were to be an upturn in the regional economy demand would go to sites well located in relation to the primary road corridors rather than Ware, and that there was no evidence that office demand would increase in Ware should supply be increased, there being a need for a fundamental shift upwards in the market, and not just a general upturn, before office rental levels in Ware would support the costs of development. These were concessions numbered (vi) and (vii) in paragraph 6.8 of the Respondent’s Written Closing.

Ground 5: the defendants’ submissions

228.	The first defendant’s skeleton argument said that the viability study was an afterthought by the claimant, first investigated with the Council two weeks in advance of the hearing, whereas the relevant procedural rules provided for exchange of evidence four weeks before the hearing. If the viability study were to assist the claimant, it must show that nothing other than the appeal proposal would be viable. Here, however, all that was dealt with in the viability study was 100% office development and 50/50 office/residential development. 

229.	The Inspector gave the viability study little weight, and applying the approach of Lord Hoffmann in Tesco Stores, this was a matter for the Inspector.

230.	As to the criticisms made by the claimant, the first sentence of paragraph 21 of the Decision Letter was accurate. The Footnotes did not explain how the figures were derived – they merely gave sources for assumptions, of which items 8 to 12 were the claimant itself. As to items 3 and 4 there were no explanations, and on land value, this will inevitably depend on what you have permission to do with the land. Nor were the implications explained – for example, if assumption 3 gave a negative, what would happen if you used a lower value? The claimant had chosen to put forward a study with a lack of explanation. 

231.	The point that if you put into the computation the rates for Hertford then the computation would still produce a loss was a point which had been made by the Council and was a perfectly fair point, submitted Mr Strachan.

232.	As to the Inspector’s reference to Hertfordshire, the Inspector had allowed for abnormals. There was no dispute that Hertford has the highest rentals for East Hertfordshire. Beyond that area, East Hertfordshire competed with Stevenage and Welwyn. The competing areas had more office space, and rents were below £18. It was difficult to see how the Inspector could be criticised – the viability study proved too much. 

233.	As to the comparison point, the sentence in question began, “moreover”. The claimant’s reliance on the points made in paragraph 6.8 of its closing submissions and the allegations made were little more than an impermissible challenge to the weight that the Inspector ultimately chose to give to the viability study. He had given his reasons, including the deficiencies that he identified. The particulars of claim had made no complaint about the “retained capital value” point.

234.	As to fluctuations in the economic cycle, there was no allowance for such fluctuation in the viability study. There was evidence before the Inquiry that the cycle was in downturn at the relevant time. 

235.	Turning to other non-housing uses, for example light industrial, Mr Strachan observed that the Inspector’s witness statement in paragraph 20 said that there were questions about this to Ms Hulatt. Combinations of office, light industrial and housing use might well offer profits. 

236.	Mr Strachan submitted that all these points were legitimate ones for the Inspector to take, and to lead him to attach little weight to the viability study overall. The Council had been quite entitled to conclude that they could make submissions on the viability study taking it at face value.

237.	Ms Busch adopted the submissions of Mr Strachan in this regard.

Ground 5: the claimant’s reply

238.	In reply Mr Holgate said that there was no suggestion by the Inspector that he attached less weight to the viability study because it was late. Mr Holgate submitted that the British Waterways Board case did not show that the claimant must demonstrate no other use was viable – the question was whether the preferred use might come about. As to the Footnotes, both the methods used and the input were agreed – Mr Parsons’ second witness statement had explained the process. As to land value, one could take this out of the viability study and still result would be negative. On the £18 per square foot, Mr Strachan had overlooked the point at that the “churn” was very low – 1,400 square metres. Here phasing was important. In the present case what the Council envisaged was a 4 year development scheme. No one suggested that in Stevenage it would take 4 years to phase in. 

Ground 5: analysis

239.	When late material is submitted by one side – for whatever reason – there is often a difficult tactical decision for the other side. The hearing is likely to have been arranged some considerable time in advance in order to fit in with the diaries of busy professional people. Any adjournment is likely to cause considerable inconvenience and expense. The result is that the party served will be under considerable pressure to try to deal with the late document at the hearing rather than seek an adjournment. 

240.	This is what happened in the present case. I can sympathise with the Council’s natural concern about the late service of the document, and I can well understand the considerations that led the Council to decide not to seek an adjournment. From the point of view of the claimant, however, it seems to me that it was entitled to expect that points taken against it by the Inspector on the viability study were points which it would have an opportunity to answer. Mr Parsons’ second witness statement specifically identifies two of the Inspector’s points which were not put to him and which, had they been put to him, he would have been able to answer. The first of these is the concern as to the rental/capital value comparison, lack of explanation as to how “these figures” were derived, and lack of “any other commentary on the results or implications within that study”. The second is the failure of the viability study to canvass other non-housing forms of development. Neither defendant has lodged any evidence to suggest that these points were in fact put to Mr Parsons. Both points formed part of the Inspector’s reasoning in paragraph 21 of the Decision Letter. I conclude that as the claimant had no opportunity to deal with these points the Inspector was not entitled to rely upon them. It is true that they are preceded by the word “moreover”, but that is too slender a basis to justify a conclusion that the Inspector would necessarily have arrived at the same result if he had left these matters out of account.

241.	For these reasons ground 5 of the challenge succeeds.

Ground 6: Prospect of Office Development

Ground 6: the claimant’s submissions

242.	When dealing with the first element, the Inspector said at paragraph 22 of the Decision Letter:

“22.  Overall, on balance, I find that there is a realistic prospect of the site being developed for employment use within the Plan period, subject to becoming available for that purpose. It therefore cannot be said that the site is no longer needed to meet future employment requirements and business and community needs. I consider that the proposed development would result in the loss of employment land reserved for that purpose in both the existing and emerging Local Plans. Whilst I have concluded that the relevant LP policies carry reduced weight, the proposal would also be contrary to Policy 14 of the SP. This states that only existing employment provision that is no longer required to meet future employment purposes may be re-used for other purposes. ”

243.	Here the claimant repeated its submission made under ground 5 that the test in paragraph 42 of PPG3 was whether there was a realistic prospect of the site being developed for employment purposes during the plan period. The Inspector’s conclusion that on balance this was so (paragraph 22 of the Decision letter) was said to involve error on the part of the Inspector in five respects:

(i)	His conclusions were inconsistent with his findings, and the Council’s evidence, on the surplus of office floorspace and industrial floorspace during the plan period (including the Council’s evidence treating the appeal site as a B2/B8 site). The Inspector’s witness statement (para. 23) had not responded to this point (e.g. by indicating the evidence relied upon). There was no evidence to support the assertion he makes; and/or 

(ii)	His conclusion was improperly tainted by his approach to the viability study ( see ground 5 above): and/or

(iii)	The Inspector’s conclusion was tainted by the errors identified in grounds 3  and 4 above; and/or

(iv)	By contrast the Inspector failed to identify any evidence or reasoning to support his assertion; and/or

(v)	The Inspector failed to give any reasons in relation to the above matters which were substantial factors in the appeal

244.	Point (i) above was supplemented orally by Mr Holgate. He pointed to Ms Howick’s proof of evidence updating the Employment Land Study. At paragraph 2.18 Ms Howick referred to the demand-supply relationship for total business space – the sum of industrial/warehousing space and offices. In that regard, her update identified a surplus even greater than that identified when the Employment Land Study was prepared. This allowed for changes from office to other business use, and the more the supply, the more questionable it was that the land would be used for offices.

Ground 6: the defendants’ submissions

245.	The first defendant said that far from there being no evidence to warrant the Inspector’s conclusion in paragraph 22 of the Decision Letter, that conclusion was clearly supported by the ELS. Once the Inspector had attached little weight to the viability study he was entitled to come to this conclusion. Ms Hulatt had said in paragraphs 4.12 and 4.13 of her proof of evidence that Ware had the capacity to accommodate additional office floor space, and that the Appeal Site was an important component of the District’s office land supply. At paragraph 5.3 her conclusion was that the retention of the site principally for offices was justified bearing in mind its sustainability and physical quality, the current vacancy rates in the market, the predicted need for additional office floor space in the future and the lack of suitable and available sites in the other main settlements of the District. Ms Howick in her update of the ELS, at paragraphs 3.3 to 3.5, cited Ms Hulett’s conclusions and added that because local market conditions and the features of the site itself were both favourable, she concluded that the Appeal Site, if safeguarded principally for offices, had good prospects of being developed as such within the plan period. These views had been expressed by qualified professionals. More generally, the errors alleged were in substance repeats of allegations made under other grounds and this ground was said not to add anything of substance. 

246.	The Council adopted the first defendant’s submission on this point. 

Ground 6: analysis

247.	In my view the contentions of Mr Holgate on ground 6 added nothing of substance to the points which he made on earlier grounds. Ms Howick’s conclusion that the Appeal Site had good prospect of being developed within the plan period was reached after taking account of various demand/supply mismatches. In paragraph 2.19 of her proof she commented that all these demand/supply mismatches were small, especially bearing in mind that the period under consideration was 15 years and that estimate were subject to margins of error. If there had been no legal flaw in the Inspector’s approach to the ELS and viability study, there could be no complaint about paragraph 22 of the Decision Letter. 

248.	However, for reasons given earlier, the Inspector’s approach to the ELS and the viability study cannot be sustained in law, and accordingly his conclusion in paragraph 22 of the Decision Letter must fall. 

Ground 7: Affordable Housing

Ground 7: the claimant’s submissions

249.	This ground concerned the second element. On this, the Decision Letter read as follows:

“24. The Council is exceeding it annual housing provision towards its target to provide 11100 dwellings in the period 1991-2011 and there is about 6 years land supply available in the District. It now expects a figure of 12226 dwellings to be achieved by the end of the Plan period, 10% more than required. The figures include a cautious 100 dwellings per annum of dwellings from large windfall sites against a 12 year average of 209 per annum. The contribution from Ware is substantially higher than the share of the apportionment required in the LP and most of the allocated sites in the town already have planning permission. The current Regional Planning Guidance 9 (RPG9) and the emerging East of England RSS do not at this stage identify any material change in the general non-strategic District-wide annual housing provision up to the end of the LP period, although there will need to be more reliance on Greenfield sites beyond then.

25. The Appellant claims that some of the allocated sites are Greenfield, but the Council has explained that there is a need to make provision for housing in villages, as well as in main towns, a strategy which has been endorsed by the Government Office. The allegations that the Council is relying on a draft document for the information about housing needs and that some of the sites do not yet have planning permission may also be true. But I see no reason to suppose from the previous take-up of housing land and availability of housing from windfall sites that the SP target will not be met and probably exceeded by the end of the Pan period. In any event these claims add further weight to my belief that the need for the release of alternative sites should be determined through the Local Plan process. I consider this to be particularly the case for brownfield sites such as this where there are different alternatives and competing uses. The Council has taken the first steps in this direction by allocation several employment sites for mixed use development in the Second Re-Deposit version of the Plan Review in line with SP Policy 14 and para 42 of PPG3.

26.  Whereas the site could make a contribution to the housing needs of the District as a large windfall site, I believe that there is no overriding need for it to do so because there is sufficient housing land emerging through the Local Plan process. The same is also likely to apply to the provision of affordable housing as this is related to the supply of new houses. This leads me to the conclusion that there is no overriding need for the release of the land for housing purposes.”

250.	There had, said the claimant, been a failure in these passages to take into account material considerations which had been set out in chapter 13 of Mr Parson’s proof of evidence. Paragraph 3.8 of the Appellant’s Updated Closing pointed out that the information set out by Mr Parson in this regard was agreed. It followed that the proposal of 26 units of affordable housing would make a valuable contribution.

251.	The points made by Mr Parsons in chapter 13 of his proof were as follows:

“13.1 East Hertfordshire district is a high cost housing area, with average house prices well above the national average. A number of surveys have shown that house price to income ratios in the district are also well above the national average. There is thus a major housing affordability problem for local households.

13.2  A Housing Needs Survey carried out by David Couttie Associates for the District Council in March 2004 (Appendix 14) estimates a need for 4,158 affordable homes to be built in the district 2004 to 2011 (594 units per annum). The survey identified a particular need for smaller dwelling i.e. flats and terraced houses, which are under-represented in the existing stock.

13.3 The survey largely confirmed the findings of the previous Housing Needs Survey carried out in 2000. Following that survey, the District Council’s Housing Strategy 2002 to 2005 (Appendix 15) set a target of 200 new affordable homes per annum to supplement the estimates 280 that will become available through re-lets to the existing RSL stock. The document stated that the target of 200 was set in recognition of the supply-side limitations, such as limits on land availability.

13.4  Nevertheless, the District Council document ‘Residential Land Availability Monitoring Statement 2002-2003’ (Document RJP 9) indicates that, over the two-year period 2001-2002, only 85 affordable housing units were completed in the district, of which only 7 were in Ware. This level of affordable housing provision obviously compares very unfavourably with the target new-build of 200 dwellings per year.

13.5  In recognition of the affordable housing requirements in the district Bayforbury Estates Limited has proposed the inclusion of 26 affordable units 11 x 1-bedroom and 15 x 2-bedroom) in the appeal scheme, located within the building adjacent to the Broadmeads frontage. This represents 29.2% of the total number of flats proposed (89).”

252.	This material, said Mr Holgate, showed that the only way the relevant targets could be achieved was by providing more general housing. 

253.	Turning to what the Inspector had said in paragraphs 24 and 25 of the Decision Letter, Mr Holgate said that these observations related to general housing, and what was said did not deal with the affordable housing needs. The only insight into the Inspector’s thinking about affordable housing was found in the second sentence of paragraph 26 of the Decision Letter: “[t]he same is also likely to apply to the provision of affordable housing as this is related to the supply of new houses.” However, when the Council had released land for general housing development this had not met the targets for affordable housing. The Inspector had made a leap of faith - the mere fact that the Council has enough general market housing land available for the future does not warrant any belief that there will be a change in the Council’s ability to meet the targets for affordable housing, given that it had failed to meet those targets in the past when it had equally been the case that the Council had enough land to meet general housing needs.

254.	Alternatively, said Mr Holgate, if the Inspector had taken this matter into account, the Decision Letter did not explain his reasoning.

Ground 7: the defendants’ submissions

255.	The first defendant said that the affordable housing aspect was a minor part of the case that had been advanced by the claimant on market housing needs. It had simply been asserted that the affordable housing aspect reinforced the main submissions. It had never been suggested that this aspect warranted allowing the appeal on its own. The contribution to affordable housing had plainly been taken into consideration by the Inspector, and it offered no basis for leading into the conclusion that there was an overriding need for the Appeal Site to be given over to housing use. 

256.	The Council adopted the submissions of the first defendant on this aspect.

Ground 7: the claimant’s reply

257.	In reply Mr Holgate said that the extent to which any particular housing development could include affordable housing depended upon the specific circumstances of that development. Mr Parsons had adduced hard evidence that the Council lagged behind in the securing of affordable housing. The response of the Inspector to this evidence was complete silence.

Ground 7: Analysis

258.	In my view the affordable housing point was no more than a makeweight and the Inspector was entitled to treat it as such. It is obvious that the mere fact that the Council has enough general housing land available for the future does not of itself demonstrate that there will be a change in the Council’s ability to meet the target for affordable housing. It is equally obvious, however, that the failure to meet those targets in the past does not of itself show that the Council will not be able to meet them in the future. Neither point called for specific mention by the Inspector. The contention – if there was one – that the claimant’s proposed contribution to affordable housing should on its own amount to an overriding need was, in my view, not so significant as to call for any specific analysis by the Inspector in his Decision Letter. This ground of challenge fails.

Conclusion

259.	For the reasons given above, this challenge succeeds on grounds 1, 3, 4 and 5. My reasoning on those grounds has the consequence that ground 6 also succeeds. In these circumstances I need not go into the question whether success on a single ground only would warrant relief. The cumulative effect of the flaws which I have identified is, in my view, plainly such that the Inspector’s decision must be set aside. 

260.	Orders consequential on the above conclusions should, I hope, be capable of agreement.