Planning Law Solicitors Michael Harman and Ellie Shemming discuss the lessons that can be learnt from the recent appeals concerning liability under the CIL Regulations 2010.
Forget the news of a second lockdown, the past few weeks have seen a flurry of appeal decisions from PINS concerning liability under the CIL Regulations 2010 (‘the CIL Regulations’) and the measures (some might say draconian measures) that apply for what some might see as ‘innocent’ breaches. This article reviews four recent decisions dismissed at appeal and the lessons which can be learnt from these.
In the first appeal, the appellants had been granted a self-build exemption under Regulation 54A of the CIL Regulations. To claim the exemption the procedure under Regulations 54A to 54D must be followed, as must Regulation 67(1), which requires a Commencement Notice (‘CN’) to be submitted to the Collecting Authority (Council) no later than the day before the day on which the chargeable development is to be commenced.
The allegations against the appellants were the failure to assume liability and the failure to submit a CN before commencing works on the chargeable development. The appellants did not dispute that work on the development for which planning permission had been obtained had begun and that a CN was not submitted, however they alleged that they did not believe they needed to submit any further documentation because they received information from the Council that no further action was required and did not receive the Council’s reminder.
The Inspector appreciated the appellants’ argument, however noted that the appellants, as part of the self-build exemption application form, had signed the declaration section which stated, “I understand: That my claim for exemption will lapse where a commencement notice is not submitted prior to commencement of this chargeable development to which this exemption applies”. The Inspector felt this showed that the appellants were aware of what action they needed to take to keep the exemption and the consequences of failing to do so.
The Inspector also had no evidence before him that an Assumption of Liability Notice had been submitted. Whilst the Inspector had “sympathy” with the appellants’ situation, he said it was a matter of fact that they failed to serve a CN before works began on the chargeable development; as such he had no option but to dismiss the appeal and uphold the surcharges.
In the second decision, the appeal was made under Regulation 117 (1) (b) that the Collecting Authority (Council) failed to serve a liability notice (‘LN’) in respect of the development to which the surcharge related as the liability notices were served on the previous owners of the land.
However, as the Inspector highlighted, when an LN is issued it is registered as a local land charge under the Local Land charges Act 1975 and binds the land. This means that any purchaser or owner of the property is deemed to have knowledge of any burden attached to the land by virtue of the registration. As a result, the Inspector was satisfied that the LN had been correctly served and dismissed the appeal.
In addition, although not relevant to an appeal under regulation 117(1)(b), the Inspector went on to emphasise that the only way a CIL charge can be appealed is to the Valuation Office Agency (VOA) under Regulation 114, following a request to the Council for a review of the amount under Regulation 113.
This decision is important for two reasons, not only is it a useful reminder that landowners are expected to have an imputed knowledge of liability notices as they are recorded as local land charges and bind the land, but also perhaps the more pertinent point being that you only have one chance to challenge the calculation of CIL and this is via the review mechanism. So this case further emphasises “buyer beware”.
The alleged breach that led to the surcharge in the third decision was the failure to submit a CN before starting works on the chargeable development. Here the appellant contended he submitted a CN on 18 April 2019, stating an intended commencement date of 3 May 2019. Unfortunately, the Council did not receive the CN and the appellant conceded that he could not provide any proof of postage.
Again, whilst the Inspector had “sympathy with the appellant” (a seemingly common phrase when it comes to CIL appeal decisions!), he believed pressing ahead with the development without having received an acknowledgement of receipt was a “risky strategy to take”. The Inspector could not be satisfied that a CN was submitted before works began on the chargeable development and as such he could only conclude that the alleged breach occurred, thus dismissing the appeal.
In the fourth and final appeal, the alleged breach was again not dissimilar to those already discussed, namely, the failure to submit a CN before starting works on the chargeable development. In this case, the appellant contended he submitted a CN and provided a copy; however, the Council appeared to have never received it and the appellant was unable to provide any proof of postage.
In any case, even if the CN had been received, the one provided by the appellant was deemed invalid as it did not stipulate a commencement date, it simply stated “A.S.A.P”. The Inspector had “sympathy” with the appellant if he had genuinely posted in good faith, but the Inspector felt his decision to press ahead with the development without having received an acknowledgement of receipt was, again, a “risky strategy” to take and on the evidence, he could not be satisfied a valid CN was submitted prior to works commencing. The appeal failed accordingly.
What to take from all this?
We can take a number of lessons away from these appeal decisions, namely:
If ever faced with CIL we do recommend that you consider these points as these appeal decisions make it clear that the law is the law when it comes to CIL and unless there is strict compliance, the result is likely an unsuccessful appeal and a surcharge or CIL penalty you were neither anticipating nor prepared for.
If you have a CIL issue or query, then our specialist planning law solicitors are always on hand to help where we can.