Public Sector Update - September 2011

Tuesday 6th September 2011

Planning

Draft National Planning Policy Framework Published for Consultation

The Department for Communities and Local Government ("DCLG") published for consultation on 25 July the draft National Planning Policy Framework ("NPPF"), which aims to simplify the planning system and promote sustainable development.

The NPPF summarises, and will replace, existing Planning Policy Statements, Planning Policy Guidance notes, Minerals Planning Guidance Notes and some circulars.

Policy Framework

The document outlines a new policy framework for making planning decisions.  Planning decisions will be based on the NPPF, together with local policies, neighbourhood plans and other material considerations.

New emphasis will be placed on local plans in the planning process.  The term "local plan" is not defined in the NPPF, which has led to speculation that there may be a new type of plan that is not the same as local development frameworks.  Local plans should be drawn up by local planning authorities ("LPAs") as soon as practicable, should be consistent with the NPPF, and should be informed by up-to-date market and economic data so that they meet development and infrastructure needs.

The NPPF also introduces a lower layer of planning policy:  neighbourhood plans, which are provided for in the Localism Bill.  Neighbourhood plans will give local districts the ability to set planning policies for their area and give planning permission through Neighbourhood Development Orders and Community Right to Build Orders.  Neighbourhood plans should be in line with the NPPF and the local plan for the relevant area.

Main Elements of the NPPF

The main theme running through the document is the "presumption in favour of sustainable development".  LPAs should endeavour to approve applications wherever it is practical to do so and where the benefits are not outweighed by potential adverse impacts.  Economic growth is given particular emphasis by the document.

The NPPF seeks to encourage housing growth, both in urban and rural areas.  Quality design will be encouraged, but there no longer appears to be a requirement, as is contained in PPS7, for housing in rural areas to maintain or enhance the local environment.

The NPPF retains the current guidance in PPG2 on green belts, but does not appear to give protection from development to undesignated green spaces or countryside, leaving decisions to the discretion of LPAs.

Minerals extraction and renewable energy are given particular encouragement in the NPPF, with LPAs being required to put in place positive strategies to "promote energy from renewable and low-carbon sources."

Timescale

The document is out for consultation until 7 October 2011, and it is envisaged that it will be in place by spring 2012.

Judicial Review Time Limits for Bringing Proceedings Under EU Directives Should not be 'Uncertain'

In the case of R (on the application of U & Partners (East Anglia) Ltd) v Broads Authority, Collins J has held that the courts may set a reasonable time limit for bringing proceedings under a Directive that has been transposed into English law, but the time limit must be certain.  This has implications for any time limits for bringing proceedings that involve an element of judicial discretion.

The case concerned the judicial review of a grant of planning permission to the Environment Agency to construct flood defences.  Collins J held that the local planning authority ("LPA") had made errors in its decision making process in concluding that an environmental impact assessment was not required. 

The LPA obtained planning permission to build a new defensive wall to protect land adjacent to the claimant's ("U") property after U refused them access to his land to carry out works as part of the flood defence programme. 

Collins J held that the LPA should have considered the impact of building new flood defences on U's land, since the existing defences protecting his land would be abandoned if the new wall was constructed. 

As such, there had been a breach of Directive 85/337, which was transposed into English law by the Town and Country Planning (Environmental Impact Assessment) (England and Wales) Regulations 1999.

CPR 54.5, which sets the time limit for bringing judicial review proceedings, states that an application should be made "promptly and in any event not later than 3 months after the grounds to make the claim first arose". 

In the case, U had made his application for judicial review a week before the deadline for bringing judicial review proceedings.  Although his application was allowed, Collins J held that a time limit subject to judicial discretion, such as CPR 54.5, is not sufficiently certain to represent a proper transposition into domestic law of a Directive allowing a person to challenge action adversely affecting him. 

Time limits should comply with the EU law principles of equivalence and effectiveness.  The principle of effectiveness is breached if a time limit lacks certainty, as the protection of rights derived from the Directive would not be effective. 

Collins J applied the cases of Uniplex (UK) Limited v NHS Business Services Authority (C-406/08) (2010) PTSR 1377 ECJ (3rd Chamber) and European Commission v Ireland (C-456/08) (2010) PTSR 1403 ECJ (3rd Chamber), the scope of which was held not to be confined to the Procurement Directive.

It does not automatically follow, however, that the time limit will now simply extend to three months: Collins J recommended that serious consideration should be given to amending CPR 54.5 to impose a 6 week time limit on bringing judicial review proceedings to challenge grants of planning permission.

Employment

Employer Held Liable for Racial Harassment and Discrimination Perpetrated by Child in its Care

Sheffield City Council v Norouzi UKEAT/0497/10

The Employment Appeal Tribunal has upheld the decision of an Employment Tribunal, which found that Sheffield City Council was liable for indirect racial discrimination and harassment because if failed to protect an Iranian social worker from regular harassment by a child in a care home. The key findings of the Tribunal were that a) the Council had been made aware of the child's behaviour but had not taken action to prevent it, b) this behaviour amounted to harassment, and c) the Council was liable by virtue of its failure to take action.

Although the claim was brought under the Race Relations Act 1976 it may be indicative of the approach Tribunals will take under the Equality Act 2010. It also runs contrary to some commentators' views that the principle of third party harassment is unworkable in practice. The Government is due to consult on whether the provisions of the Equality Act relating to third party harassment will be brought into force.

Construction

Construction Act changes coming into force on 01 October 2011

The changes to the Housing Grants, Construction and Regeneration Act 1996 (the "1996 Act") being introduced by Part 8 of the Local Democracy, Economic Development and Construction Act 2009 (the "2009 Act") will come into force in England and Wales on 01 October 2011.  These changes will affect all construction contracts where the employer does not intend to occupy the premises as his main residence. There are 5 key changes being introduced by the 2009 Act:

1.    Contracts - oral or in writing
The provisions of the Acts, including the right to go to adjudication in respect of a dispute, will now apply to oral contracts as well as written contracts. The motivation behind this is to bring disputes about oral contracts into adjudication, rather than tying up the courts.  The adjudication rules in the Statutory Scheme will apply unless there are written adjudication rules in the contract.

2.    Adjudication Costs
The 2009 Act now prohibits clauses in a contract which provide that the referring party should pay all of the costs arising from the adjudication, hopefully preventing a more economically powerful party taking advantage of a financially weaker party who would have to wait to adjudicate until it could afford to do so. Parties can make provision for the payment of adjudication costs, but this will be ineffective unless it is made after the notice of intention to refer the dispute to adjudication has been served and it is in writing. Parties can agree to confer the power on the adjudicator to allocate the costs of the adjudication between the parties but again this must be in writing. Statutory force is also given to the "slip rule", enabling the adjudicator to correct typographical errors in his decision.

3.    Abolition of "pay-when-certified" clauses
The 2009 Act prevents construction contracts from stating that payment is dependent on work or obligations carried out under separate contracts, commonly known as "pay-when-certified" clauses. "Pay-when-paid" clauses are already prohibited save in relation to payer insolvency. The purpose of these provisions is to offer protection to parties further down the contractual chain, particularly sub-contractors, and to help cash-flow.

4.    Payment Notices:
The requirement to give a notice of the amount of an intended payment has changed and is now given real teeth. If the employer does not serve such a notice then the contractor may serve its own notice, and unless the employer then serves a pay-less notice the employer will have to pay the amount stated in the contractor's payment notice. Payment notices must be given even if the amount due is zero.  Withholding notices are replaced by pay-less notices.  Once a sum has been notified as due in a payment notice then the paying party can serve a pay-less notice if it has reasons for paying less than the notified sum.  The pay-less notice must state the amount that the payer intends to pay together with the calculation.  Contracts can now provide for the payer, the payee or a third party (such as contract administrator) to give the payment notice.  Employers will need to understand the rules as if they fail to serve a pay-less notice they will have to pay the notified sum even if they dispute it.

5.    Suspension
Under the 2009 Act, if the paying party fails to pay the notified sum by the final date for payment, then the unpaid party can give notice to suspend performance of any or all of its obligations under the contract, in contrast to the "all or nothing" option under the 1996 Act. The unpaid party is also able to recover reasonable costs and expenses incurred in exercising its right of suspension, such as demobilisation costs. 

If anyone has any queries regarding this article I can be contacted at s.homer@ashfords.co.uk 

Personal Injury

Local authority resources and section 58 of the Highways Act 1980

The Court of Appeal judgement in the case of Wilkinson v City of York Council is, on the face of it, a crushing blow to highway authorities. The road in this case should have been inspected every three months. Due to limited financial resources, the local authority only inspected the road annually - the last inspection being 10 months before the accident.

S58 provides a defence to claims against a Highway Authority for failing to maintain the structural condition of highways. However, the defence will succeed only if the local authority can show that it has done all that was "reasonably required" to make the road safe for users.

In Wilkinson, the Appeal Court held that a local authority's resources should not be taken into account when deciding whether they have a defence under s58 of the Highways Act 1980.  Toulson LJ considered that any reliance on limited resources would undercut the purpose of imposing an absolute duty of maintenance on a highway authority.

This judgment is inconsistent with previous decisions of the Court, which have favoured a more balanced approach between private and public interests in relation to the Highways Act. In particular, judges have in the past expressed the clear view that resources are a relevant consideration under s58.  A discussion of what is "reasonably required" has also been a prominent feature in the debate.  In Wilkinson Toulson LJ concluded that this is an objective test based on the risk of injury arising from various factors set out in s58(2) (of which financial resources is not a factor).  However, judges in previous cases have favoured a concept of reasonableness which balances all considerations, including the authority's financial constraints. 

Even under Toulson LJ's strict interpretation of the s58 defence it seems that there may be room for financial resources and other similar considerations to be indirectly considered under s58 (2).  It would seem illogical to try and assess, for example, "whether the authority knew or should reasonably have been expected to know of a relevant defect" without considering the labour force available and the budget at their disposal for carrying out inspections.

Local authorities must, however, pay attention to any codes of guidance when discharging the statutory burden under s41 of the Highways Act.  If they wish to depart from the code of guidance they should ensure that these decisions have been properly recorded and passed through a thorough consultation process at an executive level.

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