Neutrality Strikes Again

In the wake of Natural England's advice on the Stodmarsh Special Area of Conservation (SAC) in the summer of 2020, residential development in significant parts of Kent has been grappling with a moratorium. Among the UK regions, Kent is among the hardest hit, with six districts affected by this development freeze.

 

However, Kent is not alone in facing this challenge, as a total of 42 local authority areas are now impacted by nitrogen and/or phosphorous neutrality restrictions, directly related to European sites safeguarded by the Habitat Regulations.

 

Mitigation efforts so far have been site-specific, with the majority of development sites struggling to find practical solutions to comply with the regulations. Consequently, tens of thousands of homes in Kent alone, and over a hundred thousand across England, are caught in a state of limbo due to this situation.

 

Until June 30th, the prevailing belief was that only planning permissions granted after the introduction of the moratorium by Natural England would be affected. Reserved matters consent and conditions discharge were considered exempt. As a result, many housebuilders could continue developing projects for which consent had been issued before Natural England's advice.

 

However, a recent High Court ruling has upended this understanding. The case in question, C G Fry & Son Ltd v Secretary of State for Levelling Up Housing and Communities & Anor [2023] EWHC 1622 (Admin), delivered on June 30th, centered on whether nutrient neutrality requirements could be applied to reserved matters or condition discharge applications, even if the original permission predates the Natural England guidance.

 

Unfortunately for developers, the High Court did not only ruled in favour of this position but also indicated that these requirements might extend to a broader range of circumstances than previously assumed. The court highlighted several crucial points from their decision:

 

• The Habitats Directive and Habitats Regulations 2017 mandate an appropriate assessment before consenting to a project, regardless of the stage in the planning process, as per UK planning case law and the precautionary approach.
• If an appropriate assessment is deemed necessary, it can be conducted at any decision-making stage, including the grant of planning permission, reserved matters, or condition discharge.
• Assessments carried out at the condition discharge stage are not limited to matters related solely to the condition in question but encompass the project as a whole.

 

This ruling has far-reaching implications for all residential developments permitted prior to Natural England's advice, and it affects projects that require reserved matters consent or conditions discharge. Consequently, these developments could be required to be put on hold, cease ongoing construction, or find ways to retroactively implement nutrient neutrality mitigation measures. The potential impact on affected areas is vast and significant.

 

In the immediate term, local councils are likely to adhere to the High Court ruling. However, it's worth noting that the claimant has been granted consent to appeal the ruling, although the timeline for the appeal remains uncertain. In the meantime, this ruling deals another blow to housebuilding in the affected areas, exacerbating the challenges faced by developers.