Town and country planning – Community infrastructure levy – Liability – Claimant obtaining planning permission for development of property – Defendant local authority serving statutory liability notice on claimant two and a half years after permission granted – Defendant serving statutory demand notice – Claimant applying for judicial review – Whether notices valid – Application granted
The claimant wished to develop her residential property at 40, The Ridgeway, Radlett, Hertfordshire. On 11 December 2016, she applied to the defendant local authority for planning permission to construct a three-bedroom detached house on the site. Her application was submitted on a prescribed form via the defendant’s online planning portal. The development gave rise to a potential charge to community infrastructure levy (CIL). On 13 December 2016, the defendant sent an email to the claimant advising her of the forms to complete for the purposes of the Community Infrastructure Levy Regulations 2010. The claimant was required to complete a self-build exemption claim form to enable her to claim relief from CIL and the defendant said it was highly recommended that the claimant should also submit an assumption of liability form.
The claimant submitted the self-build exemption form but believed that it was neither mandatory nor necessary to complete the assumption of liability form. However, by regulation 54B(2)(a)(ii) of the 2010 Regulations, a formal assumption of liability to pay CIL was a precondition to a valid claim for exemption.
Planning permission was granted in February 2017 and works commenced in August 2017 but the defendant failed to submit a commencement notice as required by regulation 67 of the 2010 Regulations. As the claimant failed to respond to the defendant’s email with the completed forms to enable her to qualify for relief, the defendant issued a liability notice for the full CIL amount of £16,389.75 on 5 August 2019, followed by a demand notice on 21 April 2020.
The claimant applied for judicial review of the demand notice contending, among other things, that the liability notice on which it was based was unlawful because it failed to comply with regulation 65(1), (2)(a) and (g) of the 2010 Regulations.
Held: The application was granted.
(1) The defendant was required to issue and serve statutory notices which complied with the requirements in the 2010 Regulations in the prescribed sequence. In considering the effect of non-compliance with regulation 65, it was necessary to consider the nature and purpose of the liability notice requirements in the context of the overall statutory scheme. The “levy” raised under the CIL statutory scheme was a development tax. There were exemptions for those, such as the claimant, who were developing their own home, but they were only awarded where precise procedural requirements were met. In the sequential scheme of notices under the 2010 Regulations, the liability notice was critically important. It was the formal notification of a person’s liability to CIL and identified any other recipients of the notice, their addresses, and the category within which they fell. It set out the amount of CIL payable, showing how the calculation had been made and indicated whether the authority accepted that the person was eligible for any exemption or relief from CIL. The notice informed the owner of the land that the CIL liability had been registered as a local land charge against the land affected by the planning permission in the notice. It explained the requirement to submit a commencement notice disclosing the date when development would commence. It warned the recipient that failure to submit a commencement notice might result in the loss of relief and explained that the council would send a demand notice after a commencement notice had been served, setting out the final amount payable, the date when payment had to be made, and the precise payment arrangements. It explained that liability to pay in full arose from the date development commenced and the consequences of non-payment, including liability to additional surcharges. The notice offered recipients a right to apply for a review of the calculation by the authority and set out the rights of appeal, directing the recipient to the appropriate links and addresses for obtaining further information and copies of CIL forms: R (Oval Estates (St Peter’s) Ltd) v Bath and North East Somerset Council [2020] EWHC 457 (Admin); [2020] PLSCS 36 applied.
(2) Regulation 65(1) provided that the liability notice should be issued as soon as practicable after the day on which a planning permission first permitted development. In the present case, the 2019 liability notice was issued almost two and a half years after the grant of planning permission. Such a long period of time could not reasonably be described as “as soon as practicable” and that amounted to a breach of regulation 65(1). The breach was not waived by the claimant. There was no provision for extensions of time. Time started to run from the date on which a planning permission first permitted development. The phrase “as soon as practicable” gave an authority some flexibility but, in the light of the statutory scheme and its purpose, the expectation had to be that any delay would be measured in weeks or months, not years. The collecting authority’s power to subsequently issue a “revised liability notice” under para (4) or (5) only enabled it to amend or replace an earlier valid liability notice which had previously been issued and served.
(3) The failure to issue and serve a valid liability notice on the claimant within the prescribed time period was prejudicial. If the claimant had received a timely liability notice, it would have alerted her to the fact that her CIL liability was the substantial sum of £16,389.75, and she had not been granted the exemption or relief for which she had applied. That might have prompted her to challenge the notice with the authority, and then take the necessary steps to complete her exemption application. By the time the 2019 liability notice was issued and served, it was too late, as she had already lost her exemption, and surcharges had been imposed upon her.
(4) As the liability notice was a formal legal document, which imposed a tax liability on the recipient, and placed a land charge on the owner’s property, it was of fundamental importance that the recipient was correctly identified by their name. In this case, the liability notice should have been addressed and issued to the claimant personally. Instead, the defendant addressed and issued the liability notice to the claimant’s business which had no legal or beneficial interest in the property and did not fall within any category of recipients. As the liability notice was not addressed and issued to the correct person, it was invalid and the regulations did not contain any provisions to save a non-compliant notice.
The claimant appeared in person; Emmaline Lambert (instructed by Legal & Democratic Services) appeared for the defendant.
Eileen O’Grady, barrister
Click here to read a transcript of R (on the application of Trent) v Hertsmere Borough Council
