Court of Appeal: Infrastructure on the Regulation 123 List can be a factor in refusing planning permission or imposing conditions


Last month, in the case of Oates v Wealden [2018] EWCA Civ 1304, the Court of Appeal considered the relationship between infrastructure which has been placed on a local authority's Regulation 123 List, and the need for local authorities to ensure development is acceptable in planning terms.

What is the Regulation 123 List?

Under the CIL Regulations, every local authority has to keep a list (called the Regulation 123 List) of specific infrastructure projects (or types of project) which it intends to fund wholly or partly through CIL receipts. 

What does it have to do with planning obligations and conditions?

A local authority cannot impose a planning obligation on an applicant through a s 106 agreement or unilateral undertaking that requires them to fund infrastructure projects on the Regulation 123 List or (in the case of highways) enter into a highways agreement to carry out all or part of the project themselves. Similarly, an authority cannot attach a condition to a permission which prevents the development being carried out until a highways agreement to carry out highway works on the 123 List is entered into.

What issue did the court consider?

Oates v Wealden concerned a decision by a local authority to grant planning permission for a residential development. When considering the application, the Council had identified that the new development would put increased pressure on the roads and that upgrade works at a number of junctions would be needed to mitigate these impacts and make the development acceptable. However, several of the junctions were already included on the Regulation 123 List as infrastructure to be funded by CIL receipts.

Following the CIL Regulations, the Council concluded (rightly) that it could not impose any conditions or obligations requiring the applicant to carry out or fund the junction works which were on the Regulation 123 List. This meant that there might be a delay between the development being completed and the required works to the junctions being carried out but the Council noted that there was nothing more that the applicant could do (other than pay CIL) to mitigate the impacts on the highway network. 

However, the planning officer's report to the Council's planning committee also appeared to suggest that the CIL Regulations meant that the Council could not consider the need to deliver the junction works before the development was completed as a factor in its decision.

The Council went on to grant the permission.

The claimant challenged the decision on the basis that the Council had made an error in law by failing to consider the harm that would be caused by a delay between the residential units being occupied and the required improvements to the junction being completed.

What did the court decide?

The court decided that, taken as a whole, the planning officer's report was not misleading and rejected the claimant's challenge.

However, the court also considered the proper interpretation of the CIL Regulations and provided the following guidance:

  • a planning authority can take into account any delay or possible delay between a development being finished and infrastructure required to mitigate the development's impact being completed under the CIL regime when deciding whether or not to grant planning permission; and
  • there is nothing to prevent a local authority from attaching a condition to a planning permission that requires the infrastructure on the Regulation 123 List to have been completed before a development may be used.

What does this mean?

In practice, many local authorities already consider exactly the issues set out above when considering planning applications. However, the Court of Appeal's guidance does clarify the law on: what local authorities can and cannot take into consideration when dealing with proposed developments the impacts of which are to be mitigated by infrastructure on the Regulation 123 List; the types of condition that can be imposed. The decision may embolden local authorities to impose conditions preventing or limiting occupation until the required infrastructure projects have been completed. 

The decision may make delivering new development more difficult:

  • local authorities may require more mitigation measures than previously to cover any delay between the completion of the development and the upgrading of infrastructure on the Regulation 123 List;
  • local authorities may grant planning permission subject to a condition which prevents occupation until the required infrastructure upgrades have been completed meaning that developers may complete their developments but be unable to occupy until the local authority has completed infrastructure works.

Key Points

The decision shows that there is a real risk that developers may be faced with conditions requiring infrastructure to be developed the delivery of which is outside their control.

The case exposes one of the key tensions that results from the CIL Regulations – that where offsite works are needed to mitigate impacts, and those works appear on the Regulation 123 List, the developer is reliant on the Council delivering those works to enable the development to be delivered.

In their report A New Approach to Developer Contributions the CIL Review Team, chaired by former BPF Chief Executive Liz Peace, recommended that the CIL regime should be amended to allow a more flexible approach for situations such as the one considered in Oates v Wealden to allow developers to provide the infrastructure themselves. However, to date the Report's recommendations have not been implemented.

Key contact

Marnix Elsenaar

Marnix Elsenaar

Partner, Head of Planning
United Kingdom

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