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	England and Wales High Court (Administrative Court) Decisions
You are here: BAILII >> Databases >> England and Wales High Court (Administrative Court) Decisions >> Nero Holdings Ltd, R (on the application of) v Secretary of State for Communities & Local Government [2009] EWHC 749 (Admin) (12 March 2009) URL: http://www.bailii.org/ew/cases/EWHC/Admin/2009/749.html Cite as: [2009] EWHC 749 (Admin)

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IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
THE ADMINISTRATIVE COURT

		Royal Courts of Justice Strand London WC2A 2LL
		12th March 2009

1. THE DEPUTY JUDGE: This is an application under section 289 of the Town and Country Planning Act 1990, against a decision by the first defendant's inspector of 6th August 2007 to uphold, with variations, an enforcement notice served by the second defendant which required the cessation of use on the ground floor of 271 High Street, Epping, for mixed use (A1/A3 purposes) and the reversion of the use of the premises to A1.
2. Permission to appeal was granted by King J on 14th February 2008. The appeal was made under grounds 174 subsection (2)(a), (f) and (g) of the Town and Country Planning Act. The appeals under subparagraphs (f) and (g) are not relevant to the issues before me. The appeal proceeded by way of a public inquiry and a decision was made after that and a site visit. The inspector dismissed the ground a appeal. By the time of the enforcement notice the appellants had been operating as Café Nero on the High Street in Epping for some time.
3. Mr James Finlay QC, who appears on behalf of the claimant in these proceedings, seeks to challenge the decision letter primarily on the basis of a deficiency of reasons. It is convenient, therefore, to start with the relevant parts of the decision letter.

Decision Letter

4. In paragraph 2 the inspector identified the main issue as the effect of the use on the retail function vitality and viability of Epping town centre taking into account the provisions of the development plan. In paragraphs 3 to 7 the inspector sets out the planning policy context. In particular she referred to the Epping Forest District Local Plan alterations of July 2006. Epping is one of three principal town centres in the district. The policies of the local plan seek to safeguard the retail function of the town centre.
5. Paragraph 6 of the decision letter explained the policy role within the town centre as follows:

"The Local Plan recognises the role that appropriate complementary non-retail uses can make to the attractiveness, function, vitality and viability of town centres. But in order to establish to optimum effect considers it necessary to control their extent and location. To safeguard their primary retail function the Local Plan Proposals Map defines 'key frontages' within the main centres. These have at least 70% of their frontage in retail use and no more than two adjoining non-retail uses anywhere in their length. Key retail frontages are defined as the minimum amount of frontage that the local planning authority considers needs to be maintained to ensure that the town centre retains its position in the hierarchy. As a means of achieving a reasonable balance of uses within town centres, Policy TC4 encourages non-retail uses within key frontages, provided (i) the total non-retail frontage length does not exceed 30% and (ii) it would not result in more than two adjacent non-retail uses. The lower case text at 11.50a says that the Council will refuse planning permission for any applications that would result in the 30% non-retail limit being exceeded. Proposals for new uses in non-key frontages are not subject to numerical limits, but will be assessed in accordance with other policies, including TC1 and TC3."

6. The inspector found that the development plan policies very much reflected the guidance in PPS6, which is the national policy guidance for town centres.
7. Paragraphs 8 to 29 of the decision letter set out the inspector's reasons for her decision on the grounds of appeal which are relevant to my decision in these proceedings. In paragraph 8 of the decision letter the inspector observed that 29.9% of the key frontage in Epping was in authorised non-retail use, which was the same position as at the date of the adoption of the local plan. In paragraph 9 the inspector noted that the appeal site was located within a defined key frontage and was flanked by two units in A2 use, namely a bank and a building society.
8. In paragraph 10 the result of allowing the appeal in terms of percentage of non-retail use within Epping's key frontages was set out, namely, that it would rise to 31.3%. In addition, there would be three adjoining non-retail units with a combined frontage length of 24 metres, so that authorisation of the development would reach both parts of the Local Plan Policy TC4.
9. In paragraph 12 the inspector found that the predominant use of 271 High Street, which is where Café Nero was operating from was as an A3 type activity, with A1 as a subsidiary, albeit more than an ancillary element. The mixed nature of the use meant that it had to be regarded as non- retail for planning policy purposes. Paragraph 16 of the decision letter is one to which both parties attach some importance. It reads as follows:

"I have no doubt that the Caffé Nero outlet has proved a popular addition to the town centre for quite a number of customers and nearby business operators. It seems likely that it has attracted additional customers to the town centre, and/or this part of the High Street. The Council does not dispute that it is an appropriate and complementary town centre use that adds to an active street frontage during the daytime. The A1 element of the sales (estimated as representing 600-800 customers a week) is higher than might be generated many other solely A1 (or non-retail) uses. The appellants say that were the ground (a) appeal to be unsuccessful they would continue to operate from the premises as a primary A1 business, with ancillary A3 eat-in facilities and the external appearance of the premises would be unchanged. No evidence of harm to the vitality and viability of Epping town centre arising directly from the unauthorised change of use was put forward by any party."

The inspector went on in paragraph 17 to consider what she referred to as the "bigger picture". In that paragraph she said:

"However, it is necessary to look at the bigger picture and the Council's aims and objectives for their town centres, and Epping in particular, as expressed through their development plan policies. I have no reason to doubt that the operation of development plan policies, in the past has been a major contributor to the health, vitality and viability of the town centre and its position within the local and county hierarchy, underpinned by the retail function of the town centre. The protection of the retail function of those key frontages is expressed most recently and explicitly through Local Plan Policy TC4, which complements and supports Policies TC1 and TC3. It sets an upper limit to non-retail uses as a clear statement of policy to maintain the predominant retail character and function of the town centre in general and the key frontages in particular."

10. The inspector noted special need characteristics that were urged by the appellant's in paragraph 19, but noted that the development plan did not distinguish between types of complimentary non-retail uses. She noted that numerous non- retail uses could make out a good case for being allowed to operate in a key frontage and the 30% limit in Epping allowed many to do so without breaching the development plan limit. But, she noted, that the town centre was then at the point where the policy limit had been reached and any further loss of A1 would breach it.
11. In paragraph 20 the inspector explained the policy implications of reaching the limit as follows:

"With any policy it is easy to say 'one little breach won't cause much harm' and in all cases it is necessary to take into account other material considerations. But once an upper limit policy has been breached, particularly without adequate justification, the status and impact of the policy is devalued. Rather than continuing to mark a firm limit it becomes harder and harder for the Council to refuse other complementary non-retail uses within the key frontages. This can progressively diminish their retail function and character with the danger that in time it becomes so undermined that there is little if anything left to protect and the qualities which made it attractive to retail operators and customers (and other complementary uses) no longer exist, to the detriment of the town centre as a whole and its place in the hierarchy. The critical tipping point in the retail/non-retail balance and function of any frontage or town centre can only be identified retrospectively, possible not for several years, but once that point is passed it is very difficult to redress the balance. The harm has been done."

12. From paragraph 23 the inspector addressed the fallback position put forward by the appellants, namely that they would continue to occupy and operate the premises as a primary A1 unit. In paragraph 25 the inspector found that for the A1 use to become a genuine primary use and the A3 merely ancillary, considerably more than the modest reduction proposed by the appellants would be necessary. In paragraph 26 the inspector accepted that a change of use to A1 would not materially alter the external appearance of the premises and the internal layout and operation of the front part.
13. In paragraph 27 the inspector expressed her view as to what the fallback position would be:

"There are clearly divergent views between the parties on what the fallback position would be in this case. But I take the view that the requirement to revert solely to a Class A1 use (albeit with an ancillary A3 component) would require a significant alteration to the nature of the business and the internal layout. To accept the argument that the fallback would mean little material change to the character and appearance of the unit and that this justifies the case for allowing the use seems to me to be spurious. The authorisation of the mixed A1/A3 use, even if proscribed by conditions limiting its use to that of a coffee bar as currently operated would, in all probability, ensure its continued operation as a predominantly A3, non-retail use. Whereas its reversion to a genuine A1 use, as required by the enforcement notice, would require future occupiers to operate within those parameters."

In paragraph 28 the inspector referred to previous appeal decisions but found that none were comparable to the circumstances before her, so as to add significant weight in favour of allowing the ground A appeal. The inspector finally concluded in paragraph 29:

"The Council's development plan policies for Epping town centre are recent and fully in accord with PPS6. Were the current use to be authorised both limbs of Local Plan Policy TC4 would be breached. In my view these facts are sufficiently significant and compelling to satisfy me that the change of use in this case would add to the proliferation and concentration of non-retail uses in such a way as to have the real potential to undermine the retail function of Epping town centre. To set this potential for harm aside lightly would substantially undermine the intent of Policy TC4 and the efforts of the Council in promoting the vitality and viability of the town centre and maintaining its position in the strategic hierarchy. I have taken into account the material considerations put forward by the appellants. But neither individually nor cumulatively do I find that they are of sufficient weight to justify the grant of planning permission contrary to the development plan and with the risk of harming the long term retail function, vitality and viability of the town centre."

The Legal Framework

14. Section 70(2) of the Town and Country Planning Act 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."

Section 38(6) of the Planning and Compulsory Purchase Act 2004 provides that:

"If regard is to be had to the development plan for the purpose of any determination to be made under the planning Acts the determination must be made in accordance with the plan unless material considerations indicate otherwise."

15. The inquiry was conducted pursuant to the Town and Country (Enforcement) Determination by Inspectors Inquiry Procedure Rules 2002. By regulation 20 the inspector has a duty to give notification of the decision and his reasons for it in writing.
16. As to Reasons the duties of a decision maker have been restated in the decision of the House of Lords in South Buckinghamshire District Council v Porter (No 2) 2004 UKHL 33 by Lord Brown, at paragraph 36 where he says:

"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."

17. On consistency of previous planning decisions, they are capable of being, as a matter of law, material considerations (see North Wiltshire District Council v Secretary of State for the Environment (1992) 65 P&CR 137. In particular, page 145, where Mann LJ indicated that was the case, but that it will depend upon whether those decisions were distinguishable in some way.
18. On precedent, the judgment in the case of Poundstretcher Ltd v Secretary of State for the Environment [1988] 3 PLR 69, at page 79F that mere fear or generalised concern is not enough to found an objection on the basis of precedent was considered in the later case of Rumsey v Secretary of State for the Environment (2001) 81 P&CR 32 at paragraph 16 as not to provide a precise legal test as to the nature of the material that the inspector must have before him but to provide a recognition that the inspector must have some material on which to base his conclusions.

Submissions

19. Mr Finlay QC, who appears for the claimant in this hearing, as he did at the public inquiry in 2007, submits that the challenge is primarily a reasons challenge and concerns the failure to deal adequately with Nero Holdings' arguments as to the fallback position in that, even if the company lost the appeal, it would continue to trade from the premises as an A1 use. He submits that the developer needs to know why he failed in Epping but succeeded elsewhere on similar appeals. A developer, he submits, needs to know what he can do in circumstances such as this.
20. I revert to what might be described as those overarching submissions after dealing with the particular criticisms that Mr Finlay makes. Very fairly, Mr Finlay did not pursue his initial criticism that the inspector made an error in considering the fallback situation. He accepts that, in itself, if that occurred, it would not lead to a quashing of the decision letter. What Mr Finlay does submit is that, in considering the fallback situation, the inspector failed to acknowledge that with an A1 use remaining, there would be a significant retail use and that the use proposed by Café Nero was not the same as other non-retail uses. It could be conditioned to be a coffee bar, as it had been in three other appeal decisions by other inspectors. Although those decisions at Harpenden, Sidcup and Seven Oaks were different, the issues raised were similar, so that the inspector in the instant case should have explained why she was differing from her colleagues. They had identified no harm and no detriment as a result of the proposed use so that, if the inspector was to take a different view, it was incumbent upon her to explain why that was the position. Consistency, it was submitted, was an important factor in the decision-making process. Further, it was submitted, that the inspector did not deal with the reasoning behind the local plan policy TC4 so as to identify what the harm would be through the policy breach here.
21. To set the Epping decision in context it is helpful to set out Local Plan Policy TC4. That reads:

"POLICY TC4 - NON-RETAIL FRONTAGE

THE COUNCIL WILL GRANT PLANNING PERMISSION FOR NEW NON-RETAIL USES AT GROUND FLOOR LEVEL WITHIN KEY RETAIL FRONTAGE (AS IDENTIFIED ON THE PROPOSALS MAP) PROVIDED IT WOULD NOT RESULT IN:

(i) NON RETAIL FRONTAGE EXCEEDING 30%; AND

(ii) MORE THAN TWO ADJACENT NON-RETAIL USES, REGARDLESS OF SHOP FRONTAGE WIDTH."

Paragraph 11.50a of the reasoned justification to the policy reads as follows:

"Retail function will be safeguarded in each town centre by ensuring at least 70% of the ground floor key retail frontage (measured in linear metres) must be kept in retail use. The Council will refuse planning permission for any applications that would result in the 30% non-retail limit being exceeded."

22. If the appeal proposal succeeded, it was common ground that the non-retail frontage in Epping would exceed 30% for the first time and that there would be more than two adjacent non-retail uses, regardless of the shop frontage width. Both limbs of policy TC4 were therefore breached.
23. Before the inspector, at the public inquiry, the appeal was run accepting that was the position but with the emphasis being placed upon other material considerations. One of those was the fallback position which, it was argued, would cause more harm as a result of a reduction of football into the town centre than by allowing the appeal.
24. The inspector at the inquiry was clearly aware of the consequences for policy TC4, through allowing the appeal, as is evident from her clear record in paragraph 10 of the decision letter, which I have set out already. She considered the strategic consequence of the development plan policy in paragraph 17 of the decision letter and the contribution that the policy framework had made to the vitality and viability of Epping town centre. She went on, in paragraph 18, to consider the evidence base for the 70% and 30% split found in policy TC4 and concluded that it had been through the local plan process, was consistent with national policy in PPS6 and allowed for a mix of retail and non-retail use in the town centre. As such, and consistent with section 38(6) of the Planning and Compulsory Purchase Act, her first consideration was to determine the application in accordance with the development plan and against the then appellants unless material considerations indicated otherwise.
25. Her next step was to consider those other material considerations. That is where the other decision letters for Café Nero proposals at Harpenden, Sidcup and Seven Oaks came in. However, none of those decisions related to a situation where a policy tipping point had been reached with the development proposed in any of those centres. It is clearly correct that other appeal decisions are capable of being material consideration and that consistency in the appellate process is important for developers, local authorities and public confidence. Here, however, although there were some similarities in those proposals in that the use proposed was the same as that which was proposed in Epping, those previous appeal decisions were clearly distinguishable, in that, although they were contrary to policy, they were not the proposal that tipped the non-retail frontage in the town centre over a development plan threshold in a recently adopted local plan which was consistent with national policy.
26. In those circumstances, in my judgment, it was not necessary for the inspector to embark upon a specific analysis of the other three appeal decisions, each in a differently locality and to which different policy considerations applied, both in terms of the location of that appeal site, applicable planning policies and the existing balance between retail and non-retail uses at the time those decisions were made. Further, in the cases which have been referred to, namely that of North Wiltshire and Dunster, both of them were cases where previous decisions had related to the same site which is not the position here. I therefore accept the submission of Mr Kolinsky, who appears for the Secretary of State, that the inspector went as far as she needed to in paragraph 28 of the decision letter, when she stated that the other appeal decisions did not appear to her to be directly comparable in circumstances in this case. There was no obligation upon her, having distinguished the circumstances of those three previous appeal decisions, to condescend to any greater detail.
27. The next point raised by Mr Finlay is put that no harm was identified by the inspector from the fallback position, which in fact contributed less to the vitality and viability of Epping town centre than a grant of planning permission for the proposed use.
28. I have already set out the inspector's record of the significance of reaching the tipping point of non-retail uses in Epping in paragraph 17 and 18 of her decision letter. The inspector considered the individual characteristics of Café Nero and the policy implications of permitting its use in paragraphs 20 and 29 of the decision letter. Read together, they disclose the inspector's finding as to the harm that would be caused through the grant of planning permission here. Her conclusions were specific to the situation in Epping town centre which was at the threshold set out in its own recent local plan document.
29. In that context, also, the inspector took into account two previous decisions within Epping town centre. The first in time, in 2005, related to a decision for a proposal by Costa Coffee when the decision was to grant planning permission, but that was against a different policy context to that before the inspector, who held the inquiry in the summer of 2007. In addition there, the change of use did not involve more than two adjoining non-retail uses. Secondly, an appeal decision at 263 High Street, Epping, taken a few weeks before the public inquiry was held was referred to. In that decision a fellow inspector had dismissed an appeal for a wine bar because that would breach policy TC4 also, with consequential deleterious effects on the town centre. Both of those decisions were relevant as being within the same town centre and in the latter case being taken against the same policy framework.
30. The other facet of this issue was the inspector's findings about the character of Epping town centre. In paragraph 13 of the decision letter the inspector found that the character and appearance of the Café Nero business was very much as a café within use Class A3. The inspector mentioned character again in paragraph 20, in which she observed that the progressive diminution of retail function and character caused a danger of progressively undermining a key frontage in the town centre. In paragraph 27 she found, in the specific case of Café Nero, that the fallback position to A1 use would require a significant alteration to the nature of the business and internal layout. Even with conditions to prescribe the mixed class A1 to A3 use, the unit would remain in predominantly A3 use or non-retail in character. In contrast, if the enforcement notice was upheld a genuine A1 use would ensure that all future use would be appropriate in policy terms within a key frontage.
31. In conclusion on this point, it is clear, in my judgment, that the inspector did find harm from the proposed use due to its non-retail use and character which, because of its conflict with policy had the potential to progressive undermine the vitality and viability of the town centre. That was in contrast to the fallback position of an A1 use which, firstly, would be policy compliant, and secondly, would secure that future users of the unit would, unlike the situation if consent was granted to Café Nero, also be class A1. I do not find, as a result, any deficiency in the inspector's reasons when the decision letter is read as a whole on that matter.
32. Thirdly, is the issue of precedent. Mr Finlay submits that there was no evidence before the inquiry to justify reliance on precedent. In particular, he refers to the fact that the council accepted at the inquiry that the proposed use would be restricted to future coffee bar operators who were a net attractor to the town centre and who were a destination in their own right. He refers to the case of Pound Stretcher in support of his submission that mere fear or generalised concern is not enough to support an argument on precedent.
33. As I have set out, the case of Rumsey made it clear that Pound Stretcher did not set a precise legal test but rather the issue was whether there was some evidence on which to draw a conclusion or, in certain cases, that in the facts may speak for themselves. In this case, strategic implications of a use breaching the town centre threshold in that it would make it harder to resist other non-retail uses in a key frontage provided the basis to enable the inspector to conclude as he did. As is clear from paragraphs 20 and 27 of the decision letter, the inspector's concern was not just with the immediate Café Nero use but with subsequent users of the unit. In my judgment, she had sufficient evidential basis to be concerned about precedent and expressed her reasons adequately.
34. In conclusion, on a fair reading of the decision letter as a whole, the developer did know why his appeal had failed, in the particular circumstances of Epping, with its policy framework, which would be breached with a grant of planning permission here. The consequences of that breach were set out, as was the conclusion of the inspector on the fallback position with sufficient particularity of reasoning, for an informed reader of the decision letter to know what the conclusions of the inspector were on the main controversial issues. Accordingly I dismiss this appeal.
35. MR KOLINSKY: I am grateful to your Ladyship. There is only one ancillary matter, which is costs. I understand that there is agreement both as to the principle and quantum and I would ask for an order in the first respondent's favour of £10,000.
36. MR FINDLAY: I have no objection.
37. THE DEPUTY JUDGE: I order that the appellant pay £10,000 to the first respondent in respect of costs.