Statutory Obligations

AuthorChristopher Jessel

Chapter 12

Statutory Obligations


Positive obligations can be authorised or created by a statute which overrides the rules of the common law. Several Acts of Parliament impose obligations on the owner of property for the time being where there has been no agreement with anyone. Statute can also authorise a person to give a positive obligation which binds a successor in title. Most such obligations exist for the public good, as under the planning system or for health or the environment or the historic heritage and these are enforceable by official bodies. As with covenants, while most statutory obligations are restrictive in substance, some can give rise to positive duties which bind the land irrespective of who may own it at any particular time.

Many obligations imposed for the public benefit are supported by rights of entry so that the responsible authority can come on to the land to see if problems have occurred. They may be enforced by financial penalties, either fines for commission of an offence or damages for breach of a duty. Where work needs to be done the authority may also have power to enter and rectify the problem and then recover the cost from the landowner.

In addition statute can supplement the law of nuisance or negligence to impose duties on landowners to protect visitors to premises, breach of which may lead to a private claim for damages by the person injured. There are also various private rights conferred by public Acts, as under the Access to Neighbouring Land Act 1992 and the Party Wall etc. Act 1996.1

1See para 5.4.

138 Positive Covenants and Freehold Land


One prominent exception to the rule that positive obligations are not capable of binding land is in the planning system. Planning obligations, created either by an agreement with a local planning authority or by a unilateral undertaking, are specifically able to extend to successors in title of the covenantor. The Town and Country Planning Act 1990, s 106 in its amended form reads, so far as material, as follows:

(1) Any person interested in land in the area of a local planning authority may, by agreement or otherwise, enter into an obligation (referred to in this section and sections 106A and 106B as ‘a planning obligation’), enforceable to the extent mentioned in subsection (3)—

(a) restricting the development or use of the land in any specified way;

(b) requiring specified operations or activities to be carried out in, on, under or over the land;

(c) requiring the land to be used in any specified way; or

(d) requiring a sum or sums to be paid to the authority (or, in a case where section 2E applies, to the Greater London Authority) on a specified date or dates or periodically.

(2) A planning obligation may—

(a) be unconditional or subject to conditions;

(b) impose any restriction or requirement mentioned in subsection
(1)(a) to (c) either indefinitely or for such period or periods as may be specified; and

(c) if it requires a sum or sums to be paid, require the payment of a specified amount or an amount determined in accordance with the instrument by which the obligation is entered into and, if it requires the payment of periodical sums, require them to be paid indefinitely or for a specified period.

(3) Subject to subsection (4) a planning obligation is enforceable by the authority identified in accordance with subsection (9)(d)—

(a) against the person entering into the obligation; and

(b) against any person deriving title from that person.

(4) The instrument by which a planning obligation is entered into may provide that a person shall not be bound by the obligation in respect of any period during which he no longer has an interest in the land.

(5) A restriction or requirement imposed under a planning obligation is enforceable by injunction.

(6) Without prejudice to subsection (5), if there is a breach of a requirement in a planning obligation to carry out any operations in, on, under or over the land to which the obligation relates, the authority by whom the obligation is enforceable may—

(a) enter the land and carry out the operations; and

(b) recover from the person or persons against whom the obligation is enforceable any expenses reasonably incurred by them in doing so.

Paragraphs (1)(b) and (1)(c) are positive and paragraph (1)(d) requires payment of money.

The present form of the section derives with modifications from the Town and Country Planning Act 1947, s 25(1), which provided that a local planning authority could ‘enter into an agreement with any person interested in land in their area for the purpose of regulating the development or use of the land’. Section 25(1)(2) went on to say that the agreement might be enforced by the authority:

against persons deriving title under that person as if the local planning authority were possessed of adjacent land and as if the agreement had been expressed to be made for the benefit of such land.

This was substantially repeated as s 52 of the consolidating Town and Country Planning Act 1962 and again when the Town and Country Planning Act 1990 was originally passed as a consolidation Act. The current provisions were substituted by the Planning and Compensation Act 1991, s 12, which extended it to positive covenants.

These provisions have been the subject of much litigation. In 1958, Lord Denning said in Pyx Granite Co Ltd v Ministry of Housing and Local Government:2

Although the planning authorities are given very wide powers to impose ‘such conditions as they think fit,’ nevertheless the law says that those conditions, to

2[1958] 1 QB 554 at 572.

140 Positive Covenants and Freehold Land

be valid, must fairly and reasonably relate to the permitted development. The planning authority are not at liberty to use their powers for an ulterior object, however desirable that object may seem to them to be in the public interest.

Despite this, in the property boom of the early 1970s, many local authorities took advantage of developers’ wishes to get a swift decision, coupled with the substantial profits they could make, to impose demands which were unrelated to the development or indeed to any planning purpose, such as making a payment to a local charity favoured by councillors. In theory, the developer could appeal but in practice the delay and cost meant it was simpler to give in to the demands of the authority. This created much resentment. Eventually the issue reached the House of Lords in Tesco Stores Ltd v Secretary of State for the Environment.3As it happened in that case the House considered the proposed benefit (the funding of a link road) was justified, but it gave guidance on what was or was not legitimate. Lord Keith of Kinkel said:4

An offered planning obligation which has nothing to do with the proposed development, apart from the fact that it is offered by the developer, will plainly not be a material consideration and could be regarded only as an attempt to buy planning permission.

Much of the financial aspect of s 106 obligations has now been replaced by the Community Infrastructure Levy but obligations still have an important part. The Community Infrastructure Regulations 2010,5regulation 122(2) provides:

(2) A planning obligation may only constitute a reason for granting planning permission for the development if the obligation is—

(a) necessary to make the development acceptable in planning terms;

(b) directly related to the development; and

(c) fairly and reasonably related in scale and kind to the development.

Positive planning obligations bind the land in whoever’s hands it may come, and often (as envisaged by s 106(4)) contain a provision that the original party will not be liable after selling the land. That is important because under many development agreements a landowner grants a building company an option to take the land which will be exercisable only if planning consent is granted. The local planning authority will only grant consent if there is a s 106...

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