Hill v London Borough of Bromley: Round 3 – When is permitted development completed?

In Hill v London Borough of Bromley, an inspector has allowed the landowners’ application for a lawful development certificate (‘LDC’), at appeal, after a long-running planning dispute with the local planning authority (decision letter issued 14 April 2020).

The LDC appeal concerned an important point of legal principle over the lawful status of a semi-finished residential development which had been built pursuant to a grant of prior approval. The case will be of particular interest to any developer intending to convert a building into multiple units under ‘change of use’ permitted development rights.

As a result of the inspector’s decision, a lawful development certificate has now been granted for the entire development of 8 flats.

Background to the latest LDC appeal

(i) First LDC appeal: Landowners win (LDC appeal confirms office use)

On acquiring prior approval, in December 2013, to exercise permitted development rights to convert an office building to residential use (under the former Class J of the 2013 GPDO), the landowners had every intention of progressing the development as quickly as possible, and in enabling the 8 flats to be occupied for rent.

Development works to convert the office began in January 2014, with stripping out of internal walls, ceilings, pipework, electrics, air conditioning and floor coverings. Several months later, however, the planning authority began to question the lawful planning use of the building, and so with it the validity of the prior approval consent. The authority’s move was controversial because neither party had doubted that the building was not a B1(a) office building at the time of the original prior approval application.

Works were immediately halted while the landowners tried to resolve matters, and finally, in July 2017, their application for an LDC was successful on appeal.

(ii) Second LDC appeal: Landowners win (LDC appeal dismissed/Inspector’s decision quashed by the court)

The council’s actions in querying (belatedly and incorrectly) the headline requirement for previous office use gave rise to serious financial difficulties, and delays. Ultimately the development work did have to re-start, in early 2016, in order to keep the benefit of the permitted development rights alive. But this was a huge commercial risk for the landowners because final resolution of the first LDC case was then still more than a year away.

By the end of May 2016 just one flat had been finally fitted out, and was occupied, whilst basic services had also been laid to the shell of the former office building. But generally, the rest of the development was a long way behind schedule. By December 2016 works to the other 7 flats had progressed to various stages of completion, but none of them was finally fitted out or occupied. Some of the flats just lacked bathrooms, whereas others had no fixtures or fittings at all.

As to what actually needed to be done, matters were complicated by legislative changes to the GPDO. On 15 April 2015, the 2013 GPDO was consolidated and replaced by the 2015 GPDO, with Class J becoming Class O. The 2015 Order was then subsequently amended on 6 April 2016. All this meant that one of two different legal requirements might potentially apply:

• Either, the use of the building within Class C3 (‘dwellinghouses’) of the Town and Country (Use Classes) Order 1987 (‘the UCO’) had to be begun before 30 May 2016 under limitation J.1(c) of the 2013 GPDO; or
• The permitted development under Class O had to be completed within 3 years of the prior approval date (i.e. by December 2016) by reference to condition O.2(2) of the amended 2015 GPDO.

The landowners again applied for an LDC, which the council refused, and this culminated in a further protracted series of legal proceedings.

At the public inquiry the planning authority successfully argued that 7 of the 8 flats had not been completed by the December 2016 cut-off date, having regard to condition O.2(2) of the 2015 GPDO. The inspector agreed with the council that these matters were to be decided with reference to the court’s decision in Gravesham, and the fact that each flat formed its own separate planning unit.

Gravesham is commonly cited as the defining legal test of what constitutes a ‘dwellinghouse’, but the landowners had disputed its relevance to the appeal. They argued that the guiding test was set down by the court decisions in Welwyn Hatfield and Impey instead. These rulings confirmed that a residential change of use might occur prior to ‘physical’ completion in the sense normally contemplated by Gravesham – and also, that actual, intended or attempted use of the building (as a dwellinghouse) were equally relevant considerations which the council had totally ignored. These matters had to be considered “in the round”.

The landowners took their fight to the Planning Court on three separate grounds, and won.

Round 3: What has now been decided?

The latest inspector’s decision letter confirms that:

• The development had to be completed by December 2016, in accordance with condition O.2(2). Taking account of Welwyn/Impey, this was a question of “fact and degree”.
• In December 2016, 7 of the flats were not habitable in the sense of having all the facilities for day-to-day existence usually required by the Gravesham test. Nevertheless, the inspector concluded that the office use had clearly ceased, and the flat conversions had reached such an advanced stage that reversion to office use was essentially impractical. Moreover, the inspector indicated that the landowners’ serious and determined attempt to complete the conversion was evidence of their clear intentions, which also played a significant part.

Final thoughts

The council’s obvious error was for it to ignore the substantial progress of the building works as a whole, and the landowners’ clear intentions in that regard, when it chose to refuse the LDC application. This case emphasises the need for decision-makers to give fair and objective weight to the entire range of available evidence rather than to focus on narrow issues such as whether an individual flat is physically ‘habitable’.

Lawyers for the Secretary of State had already made it clear in the previous court case that they interpreted the law in the same way, and so it is perhaps unsurprising that the planning authority has now declined to litigate these issues further.

Ben Garbett advised the successful landowners, Mssrs Hill, throughout the course of their dispute. If you would like to discuss any of the issues raised in this article, please contact Ben.