Belfields Ltd v Nextdom (Bootle) Ltd - and - David Powell Third and Secretary of State for Communities and Local Government and Sefton Metropolitan Borough Council

JurisdictionEngland & Wales
CourtQueen's Bench Division (Administrative Court)
JudgeMr George Bartlett QC
Judgment Date21 December 2007
Neutral Citation[2007] EWHC 3040 (Admin)
Docket NumberCase Nos: CO/5635/2007 CO/6406/2007

[2007] EWHC 3040 (Admin)

IN THE HIGH COURT OF JUSTICE

QUEENS BENCH DIVISION

ADMINISTRATIVE COURT

Royal Courts of Justic

Strand, London, WC2A 2LL

Before:

Mr George Bartlett Qc

(Sitting as a Deputy High Court Judge)

Case Nos: CO/5635/2007

CO/6194/2007

CO/6406/2007

Between :
Belfields Limited
First Claimant
and
Nextdom (Bootle) Limited
Second Claimant
and
David Powell
Third Claimant
and
Secretary of State For Communities and Local Government
First Defendant
and
Sefton Metropolitan Borough Council
Second Defendant

John Barrett instructed by Glassbrooks Ltd for the First Clamant

John Hunter instructed by Planning and Law Limited for the Second Claimant

The Third Claimant in person by videolink

Paul Brown instructed by Treasury Solicitor for the First Defendant

Frances Patterson QC instructed by Eversheds LLP for the Second Defendant

Hearing date: 28–29 November 2007

Mr George Bartlett QC

Introduction

1

On 30 May 2007 the first defendant, the Secretary of State for Communities and Local Government, confirmed with one small modification a compulsory purchase order made by the second respondents, Sefton Borough Council. The CPO, the Sefton Metropolitan Borough Council (Klonsdyke and Hawthorne Road) Compulsory Purchase Order 2005, was made under section 226(1) of the Town and Country Planning Act 1990 and related to 10.2 hectares of land consisting principally of disused industrial land and terraced housing in Bootle. An inspector held a public inquiry into objections to the CPO between July and November 2006. Three of the owners of land in the CPO who were among the objectors now apply under section 23 of the Acquisition of Land Act 1981 to quash the CPO as it affects their ownerships.

2

The CPO lands are part of a mixed commercial and residential area about 1 mile to the north of Bootle town centre and 6 1/2 miles to the north of the centre of Liverpool. They lie on the east and west sides of Hawthorne Road. The area to the west of Hawthorne Road is bounded on its west side by the Leeds and Liverpool Canal and consists for the most part of cleared industrial sites. One of these, the Tannery site, is owned by the claimant Nextdom (Bootle) Ltd. Also within the area to the west of Hawthorne Road is the Mel Inn, a purpose-built club building. To the east of Hawthorne Road is a former industrial site, 2.2 ha in area, known as the Penpoll Estate. It is owned by the claimant Belfields Ltd. Immediately to the south of this is the area of terraced housing known as the Klondyke Estate. Within this area are two shop premises at 115 Monfor Road and 55 Humphrey Street that are owned and occupied by the third claimant, Mr Powell. Mr Powell lives in the rooms above the shop at 115 Menfor Road.

3

At the inquiry the cases advanced by Belfields and Nextdom were similar. They each accepted the need for the council's redevelopment proposals, but they contended that there was no need for the council to acquire their lands, which, they said, they could redevelop themselves. Mr Powell's case, advanced on his behalf by Ms M J Joyce, who also spoke for other small shopkeepers in the CPO area, was that the council had misunderstood the reason for the state of the terraced property within the CPO and that there was no need to demolish it and to redevelop the land.

4

The grounds of Belfields' application are that the Secretary of State took into account a matter that was not part of the case put to them at the inquiry as justifying the acquisition of their land (the “Mel Inn point”– see below); that she failed to apply the correct test in determining whether there was a compelling case in the public interest for the acquisition; and that inadequate reasons were given for concluding that the acquisition was justified. Nextdom challenges the CPO on the grounds, firstly, that the Secretary of State failed to consider properly the issues and evidence regarding its intention or ability to develop the land or alternatively failed to give adequate reasons for her conclusions on this; secondly, that she failed to apply the correct legal and policy test for determining whether there was a compelling need in the public interest for the CPO; and, thirdly, that she erred in law in concluding that an agreement between the council and their preferred developer (the “Overarching Development Agreement”) was lawful and would not inhibit the council from deciding that it should not exercise its compulsory powers in relation to a particular site if the owner was capable of developing it itself. Mr Powell, whose contentions I permitted to be advanced on his behalf by Ms Joyce, put forward two technical points – that the CPO was not made pursuant to the correct statutory provision and that the council's cabinet, which made the order, had no power to make it. The principal submission made on Mr Powell's behalf was that confirmation of the order infringed his Article 6 rights. It was said that it did this in three respects: firstly, in that an agreement between the First Secretary of State and the council and two other councils (the “Market Restructuring (Implementation) Agreement”) amounted to prior approval of the CPO scheme; secondly, in that the Secretary of State had statutory power to disregard the objector's contentions on the foundations for the council's development plan policy on Housing Market Renewal; and, thirdly, in that significant findings of fact were not reported to the Secretary of State by the inspector.

5

Mr Powell also sought to rely on three additional grounds, notice of which had been given to the Secretary of State and the council on the first day of the hearing. In view of the lateness of the notice, I refused to permit these grounds to be relied on, although it is right to say that the arguments advanced in support of the principal grounds included elements of the matters that Mr Powell sought to add.

Belfields – the Mel Inn point

6

On behalf of Belfields Ltd Mr John Barrett submitted that the Secretary of State took account of and gave weight to a matter that was not part of the case put to the claimant, as part of the justification for acquiring its land, and that the claimant had been substantially prejudiced as a result. That matter was the Mel Inn and the need to relocate it on the claimant's land. The inspector recorded (at paragraph 374) that there was no dispute that there was a need in the area for a facility of the type provided by the Mel Inn and went on to say that the need might increase once redevelopment had taken place. At paragraph 383 the inspector concluded that there seemed to be no reason in physical terms why the Mel Inn should not relocate to the Penpoll site. In the decision letter the Secretary of State (at paragraph 14) accepted the need in the same terms as the inspector and the conclusion as to relocation on the Penpol site. She went on to state that the continuing presence of the existing building would detract from the redevelopment and there was no substantial reason why it should not continue to function from within it existing catchment area. None of this, said Mr Barrett, had ever been put to the claimant at the inquiry or advanced as part of the council's case.

7

This ground of challenge is founded on the assumption that the potential relocation of the Mel Inn on the Penpoll site formed part of the reasons of the Secretary of State for confirming the CPO. If it did not, there could clearly be no error of unfairness on her part in this respect. It is in my judgment quite clear from the inspector's report that he did not regard this potential relocation of the Mel Inn as part of the justification for including the Penpoll site in the CPO. He did not mention it when recording the council's case on the Belfields objection. On this he said:

“91. Belfields accept that the area is in need of regeneration. The site is significant due to its size (2.2 hectares) and the number of dwellings it could accommodate. Belfields accept that its timely redevelopment is vital to transform the area. There is nothing between the parties as to the need for the development of the site, the nature of the redevelopment or the timescale. The dispute is how that can be delivered in line with the timescales that the Council has to meet under the Deed of Variation.

92. Belfield's objection is that there is no need for the CPO, as they have their own proposals which have the benefit of planning permission. The Council would be content if the objector delivered the redevelopment of the Penpoll site within the timetable they have offered, subject to ensuring that the Council's aspirations are met. The difference between the objector and the Council is whether there should be any mechanism to ensure that development should take place in the event of default.”

8

At paragraph 343 the inspector summarised the issue between the parties:

“With this background, the issue between the parties is a narrow one, and focuses on the mechanism by which the development of the site can be guaranteed. The concern is whether there is sufficient assurance that development will actually take place, in the light of access to funding and expertise.”

9

After discussing the factors bearing upon this issue, in relation to none of which did he make any reference to the Mel Inn, the inspector concluded:

“353. In conclusion, although there is evidence of informed developer interest, there is no formal relationship with any developer. Therefore there is considerable uncertainty that this key development will go ahead without the Council's intervention. Likewise there is no expertise on the part of the objector themselves to carry out the...

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