Section 106 planning obligations: overcoming problems with ‘permit-free’ development

In a previous article “Use of Section 106 Planning Obligations: Restrictions on Car Parking”, I discussed the rise in use of legal instruments which intend to make some residential developments “parking permit-free”. These restrictions are typically aimed at prohibiting the occupiers of residential development from applying for a parking permit in areas where controlled parking zones are in place. Some councils have adopted this tool to manage localised traffic impacts where new housing development would be likely to exacerbate problems with on-street parking shortages.

However, there are several good reasons why landowners, developers, tenants, and prospective purchasers of residential property may wish to take specialist legal advice on the enforceability of such arrangements.

Lawful use of statutory powers

The proper use of such legal powers was initially tested with disputes in the administrative areas of Westminster City Council and the Borough of Kensington & Chelsea reaching the court in 2013 and 2017, respectively. The chief lesson from those judgments is that the effectiveness of such restrictions may depend on the statutory powers used in their creation. The result is that some section 106 agreements (and ‘unilateral undertakings’) will be binding upon the original landowner but will not be enforceable against future owners and occupiers of the property.

It is difficult to judge the true scale of this problem because some councils have since devised new ways to frame such restrictions which may bring them successfully within the ambit of s.106 of the 1990 Act. The s.106 agreement in Kensington & Chelsea was itself saved by reliance upon an altogether different statutory power: s.16 of the Greater London Council (General Powers) Act 1974. However, this particular ‘get out of jail card’ will not help to preserve the validity of legal agreements made in other local authority areas outside the London Boroughs.

Either way, it does appear that there is a significant legacy problem over the enforceability of some completed s.106 agreements (or unilateral undertakings) of this kind. Furthermore, where a new planning permission is granted this might also be vulnerable to third-party legal challenge (on application for judicial review made within 6 weeks) where it had been intended that the restrictions will remain enforceable in future.

Modification or discharge of restrictions

It may be possible to negotiate voluntary modifications to a valid s.106 planning obligation at any time. Additionally, a formal review process is also available where the obligation is more than five years old, which is triggered by making an application to the local planning authority.

The application will need to be supported by expert traffic and transport evidence to demonstrate that the existing obligation no longer serves a useful planning purpose. On-street parking conditions can change over time, but this proof will generally be easier to come by where it is felt the authority has imposed restrictions unnecessarily in the first place. There are reasons why this happens because applicants for new housing development will sometimes choose to accept an obligation for tactical reasons, as a means of avoiding a refusal and appeal, even where the grounds for imposing such restrictions are relatively weak.

How Keystone can help you

Keystone’s team of expert planning lawyers routinely advise landowners, developers, tenants, and prospective purchasers on a range of s.106 obligations. We can:

(a) assess whether any car-parking restriction (s.106 obligation) in relation to your property is legally valid and enforceable; and

(b) advise you on whether an application made to the local planning authority, to have any legally binding restrictions lifted, is likely to be successful.

If you would like to discuss these matters, please get in touch with Ben Garbett.