Barristers – Scott Stemp and Hashi Mohamed

The High Court in London ruled this week for the first time on the circumstances when planning application fees may be refunded by local authorities, in the event they fail to determine applications within an extended period of time. This is an important decision for applicants with lodged applications that are taking longer than the usually prescribed 26 week period for determination.

In the claim, a major developer, Provectus Remediation Limited, sought a refund of their £44,000 planning application fee on the basis that the local authority, Derbyshire County Council, had breached the extended agreed period of determination. The claim sought a declaration relating to the proper interpretation of Regulation 9A of the Town and Country Planning (Fees for Applications, Deemed Applications, Requests and Site Visits) (England) Regulations 2012 (“the 2012 Regulations”)

The 2012 Regulations state that fees shall be refunded if a planning authority fails to determine an application within 26 weeks of the date on which it receives a valid application. However there are exceptions to the rule, namely where an extension has been agreed between the parties. On behalf of the Claimant, it was argued that the correct interpretation of the provisions was that a fee should be refundable when an authority fails to determine an application, even if there has been explicit agreement to extend time between the parties.

Scott Stemp, on behalf of the Claimant, argued that the Regulations ought to be applied and interpreted in a manner which allowed fees to be reclaimed if planning authorities failed to determine planning applications within extensions of time that had been agreed between developers and the planning authority.

Hashi Mohamed, on behalf of the Defendant, argued that the Regulations and the particular exceptions contained therein are quite clear; Parliament sought to limit the time period during which fees were refundable.

The Court agreed with the Defendant’s submission; Sir Wyn Williams sitting as a judge of the High Court stated;

“I have reached the conclusion that Mr Mohamed is correct in his contention that reg.9A of the 2012 Regulations is clear and unambiguous. A refund of a fee paid at the time of a planning application should be made only if a period of 26 weeks has elapsed from the receipt of a valid application and that application has not been determined by the local planning authority. In my judgment, if the applicant and the local planning authority agree in writing that the 26 week period should be extended the planning fee paid by the applicant does not fall to be refunded even if the local planning authority fails to determine the application within the extended period.”

Having said this, at first blush it may seem that it would not be in the interest of any applicant to ever agree an extension of time.

However, the court did not rule on circumstances where there has been an agreed extension of time, one of the exceptions to an automatic refund, but where the applicant has reserved its position explicitly. By, for example, making clear that whilst there has been an agreement reached to extend time, the applicant still reserves the right to seek a refund in the event the newly agreed deadline has not been met. This was the crux of this case, in that whilst there were actually multiple agreements between the parties to extend time, at no time did the Claimant suggest that it would seek a refund in the event of non-determination within the extended period. It may be that after this judgement any such agreement would be non-binding, but for now this is untested.

It remains to be seen whether this will now precipitate many applicants not agreeing extensions for fear of not being entitled to a fee refund. It may also lead to sharp rise in applicants lodging appeals for non-determination.

Scott Stemp and Hashi Mohamed are members of the Planning and Environment Group at No5.  View Scott’s CV here.