London Borough of Richmond Upon Thames v Secretary of State for Communities and Local Government & Anor [2006] EWHC 3324 (Admin)

[2006] EWHC 3324 (Admin)Case No CO/4547/2006
IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
THE ADMINISTRATIVE COURT
Venue Royal Courts of JusticeDate Thursday, 7th December 2006
Strand
London WC2
B E F O R E:
HIS HONOUR JUDGE GILBART QC
Between
LONDON BOROUGH OF RICHMOND UPON THAMESClaimant-v-
Between
THE SECRETARY OF STATE FOR COMMUNITIES AND LOCAL GOVERNMENTDefendantPRINCEGATE ESTATES (HAMPTON) LIMITEDDefendant
Computer-Aided Transcript of the Stenograph Notes ofWordWave International LimitedA Merrill Communications Company190 Fleet Street London EC4A 2AGTel No: 020 7404 1400 Fax No: 020 7831 8838(Official Shorthand Writers to the Court)
MISS A ROBINSON (MR R MOULES for judgment) (instructed by London Borough of Richmond Legal Services) appeared on behalf of the CLAIMANTMR P GREATOREX (MISS L BUSCH for judgment) (instructed by the Treasury Solicitors) appeared on behalf of the FIRST DEFENDANTMR H PHILLPOT (instructed by Pitmans, Reading) appeared for SECOND DEFENDANT
J U D G M E N T
[1]This is an appeal by the claimant local planning authority against a decision of an inspector appointed by the defendant Secretary of State for Communities and Local Government to allow an appeal by Princegate Estates (Hampton) Limited and to grant planning permission for development of 28 residential retirement flats with associated landscaping and car parking at High Street, Hampton Hill, Hampton in the London Borough of Richmond. This of course is an application made to the court under section 288 of the Town and Country Planning Act 1990.[2]The proposed flats concerned consisted of a mixture of one bedroom and two bedroom dwellings. The local planning authority had not given a decision so there was an appeal in the absence of a decision.[3]The statutory framework is set by section 38(6) of the Planning and Compulsory Purchase Act 2004 and by section 70 of the Town and Country Planning Act 1990.[4]Section 38(6) states that if regard is to be had to the development plan for the purpose of any determination to be made under the planning Acts, the determination must be made in accordance with the plan unless material considerations indicate otherwise, and of course regard has to be had to the development plan under section 70 of the 1990 Act.[5]There is a statutorily approved Unitary Development Plan for the borough. Policy HSG 6, which is at page 104 of the bundle, reads as follows:
"Opportunities will be sought to maximise the provision of permanent affordable housing in any proposal which includes housing. The Council will encourage residential developments involving Registered Social Landlords, acting either on their own or in conjunction with the private sector, that will meet the needs of buyers or renters on low to middle incomes who are unable to gain access to the housing market. Affordable housing will be expected on sites: (a) capable of providing 10 or more units, or (b) of 0.3 hectares or more Such schemes will be subject to negotiation as to the appropriate amount of permanent affordable housing to be included. The Council expects that over the Plan period 40% of all new units will be permanent affordable housing. Provision will be made to ensure that housing remains permanently affordable for successive occupants. Where necessary, the Council will use its powers to restrict the occupation of property to people falling within particular categories of need. The long term management implications of the scheme should be taken into account and designed into a proposal from its inception. In exceptional circumstances, the Council may consider a financial contribution to its Affordable Housing Fund as an alternative to on site provision on the basis set out in para 8.41 below."
[6]I turn now to paragraph 8.41, which is at page 106 of the bundle. It reads thus:
"In exceptional cases, where the Council accepts off site provision of affordable housing, a Section 106 Agreement would be sought whereby a financial contribution to the Council's Affordable Housing Fund would enable equivalent provision to be made elsewhere [I interpose, that is of course section 106 of the Town and Country Planning Act]. The amount involved should take account of the value for money approach and other financial constraints under which RSLs operate and would be the subject of negotiation. The amount would be applied to the same ratio of private:affordable housing as would have been provided on site, eg if one:three of all units on site would have been affordable, then the formula should be applied to one third of the on site total. All contributions made to the ring fenced Affordable Housing Fund are re used as Local Authority Social Housing Grant (LASHG) funding, for purposes under the Housing Act 1985, either for new affordable housing or for bringing existing private properties back into use as affordable housing in pursuance of housing and planning objectives. As an alternative to financial contributions it may be possible to 'match' a site for off site provision, where it is in the ownership or control of the same developer involved in the affordable housing site. In such cases, an agreement would need to be drawn up to ensure that the affordable housing was built before, or in conjunction with, the market housing element. Information on the Fund is available from the Council."
[7]I should also read 8.42:
"Affordable housing provision will be expected in relation to sheltered housing schemes, equivalent to that stated elsewhere in the policy, but the Council would not expect a proportion of the scheme to be taken over or managed by a RSL. The affordable housing could be in the form of either: (a) a separate construction on the same site, or (b) an allocation on a separate 'matched' site as outlined in the preceding paragraph, or (c) a contribution to the Affordable Housing Fund as described in the preceding paragraph, using floor space as well as the number of units as a guide."
[8]The London Borough of Richmond had also approved supplementary planning guidance, which of course has status as a material consideration, and, as I shall come to later, was given significant weight by the Inspector.16.1 of the supplementary planning guidance, on page 117 of the bundle, reads as follows:
"In line with Circ 6/98 and PPG33 [of course that would now be Planning Policy Statement 3], the Council's policy has a strong presumption in favour of on site provision of affordable housing. In exceptional circumstances, the following alternatives may be considered..."
The first alternative it gives is a linked site proposal; the second relates to private development of sheltered housing and provision on housing on another site; the third is this it is described as a third alternative, I am sure they meant option:
"a financial contribution to the Council's Affordable Housing Fund. This Fund, established in 1993, is ring fenced to the provision of affordable housing in the Borough. It is used on schemes agreed between the Department of Social Services and Housing, the Department of Environmental Protection and Customer Services, and the Department of Environment, Planning and Review, in accordance with Housing Corporation guidance. The level of contribution is calculated according to the method described in section 17 below."
[9]Section 17 is headed "Calculation of financial contributions". 17.1:
"Where, in exceptional circumstances, a financial contribution is acceptable as an alternative to on site provision, a standard method is used."
[10]I pause to note, first that it relates to exceptional circumstances; secondly, it relates to an alternative to on site provision; and, thirdly, it describes what it calls a standard method. 17.2 reads :
"The UDP adopted in 1996 set out the formula for calculating financial contributions as 'the market value of the property less 75% TCI' [TCI is an engaging acronym for total cost index]. In most cases where financial contributions have been accepted, 100% TCI has in practice been found appropriate. The formula was not carried forward into the UDP First Review, partly because of on going discussions about the adoption of a London wide formula, and partly because it was considered that a formula is better set out in supplementary planning guidance, which is more responsive to changing circumstances than a long term plan. 17.3. The formula to be applied now is: 'The value (unencumbered) on the open market of units of the same size and in the same location, less any Social Housing Grant granted to that scheme.' 17.4. The formula is applied in such a way that a similar ratio of market:affordable units would be achieved as if they were provided on site. Thus on a scheme of 10 units involving 40% on site affordable housing there would be 6 private and 4 affordable housing units; but if the affordable housing were provided elsewhere, there would be 10 units on site and 6.4 affordable units elsewhere. The formula would therefore be applied to 6.4 units."
[11]Now, there was agreement between the local planning authority and the developer that the alternative method of making a contribution should be adopted. There was agreement on all inputs of the formula save one. The formula requires the following inputs. First, the market price of the units in question. In this case different prices were to be assumed depending on whether they were one bedroom units or two bedroom units. Second, the total cost index, the TCI, which is a proxy for the cost of providing the unit. Third, the market value less the TCI produces a figure, that is then multiplied by the number of units, so the fourth input is the number of units. The fifth input was the number of one bedroom units, and there was a size band assumed, and the sixth is the number of two bedroom units, and there was a size band assumed. I have described six inputs, it is actually five of course, the third one is the result of applying the first two. There was agreement on every item between the Borough and the developer except one, which was the market value of the units. The argument between the developer and the Borough was about how one interpreted the policies to which I have referred.[12]There were two questions in issue: first, is the value being calculated that of units which would otherwise have been built on the site itself or of units located in a wider area?; second, is the value being calculated that of newly built units, or can one use the value of existing properties of the same general description? It was common ground that if one took the value for newly built units, the figures endorsed by the Inspector were too low.[13]There was broad agreement between counsel on the principles of law relating to the interpretation of planning policy. They were recently repeated by Auld LJ in The Queen (on the application of Springhall) v London Borough of Richmond Upon Thames [2006] EWCA Civ 189. At paragraph 7 Auld LJ said this:
"In any particular case involving the interplay of a policy indicated in a development plan and other material considerations, there may be more than one acceptable interpretation in planning terms of a policy indicated by the plan, and more than one 'correct' application of it when set against the other considerations. A planning decision maker's approach to policy will only be interfered with by the court if it goes beyond the range of reasonable meanings that can be given to the language used: see R v Derbyshire County Council, ex parte Woods [1997] JPL 958, CA, per Brooke LJ at page 967 968: "
If there is a dispute about the meaning of the words included in a policy document which a planning authority is bound to take into account, it is of course for the court to determine as a matter of law what the words are capable of meaning. If the decision maker attaches a meaning to the words they are not properly capable of bearing, then it will have made an error of law, and it will have failed properly to understand the policy (see Horsham DC v Secretary of State for the Environment [1993] 1 PLR 81, per Nolan LJ at 88). If there is room for dispute about the breadth of the meaning the words may properly bear, then there may in particular cases be material considerations of law which will deprive a word of one of its possible shades of meaning in that case as a matter of law." "45. In Gransden & Co Ltd v Secretary of State for the Environment [1986] 54 P&CR 56, Woolf J, in dealing with issues relating to policies promulgated by the Secretary of State in circulars, commented by way of general observation at page 94: 15. '... it is essential that the policy is properly understood by the determining body. If the body making the decision fails to properly understand the policy, then the decision will be as defective as it would be if no regard had been paid to the policy.' 46. In R v Derbyshire County Council ex parte Woods [1997] JPL 958, Brooke LJ said this:
'if there is a dispute about the meaning of the words included in a policy document which a planning authority is bound to take into account, it is of course for the court to determine as a matter of law what the words are capable of meaning. If the decision maker attaches a meaning to the words they are not properly capable of bearing, then it will have made an error of law, and it will have failed properly to understand the policy (see Horsham DC v Secretary of State for the Environment [1992] 1 PLR 81, per Nolan LJ at 88). If there is room for dispute about the breadth of the meaning the words may properly bear, then there may in particular cases be material considerations of law which will deprive a word of one of its possible shades of meaning in that case as a matter of law. This, in my judgment, is the underlying principle of law which Auld J was putting into words in his judgment in Northavon DC v Secretary of State for the Environment [1993] JPL 761. When discussing the meaning of the expression 'institutions standing in extensive grounds', the report reads at 763: '
The words spoke for themselves and were not readily susceptible to precise legal definition. Whether a proposed development met the description was in most cases likely to be a matter of fact or degree and planning judgment. He [the judge] said "in most cases" because it was for the Court to say as a matter of law whether the meaning given by the Secretary of State or one of his Officers or Inspectors to the expression when applying it was outside the ordinary and natural meaning of the words in their context. See Gransden (EC) v Secretary of State for the Environment (1987) 54 P&CR 86, per Woolf J, as he then was (upheld by the Court of Appeal [1987] JPL 465). The test to be applied by the court was that it should only interfere where the decision maker's interpretation was perverse in that he has given to the words in their context a meaning that they could not possibly have or restricted their meaning in a way that the breadth of their terms could not possibly justify...' If in all the circumstances the wording of the relevant policy document is properly capable of more than one meaning, and the planning authority adopts and applies a meaning which it is capable as a matter of law of bearing, then it will not have gone wrong in law.' 47. It is true that ex parte Woods was a decision on a renewed application for leave to appeal. But both parties, it would appear, were legally represented; the judgment of Brooke LJ is detailed and fully reasoned; and the other two members of the Court of Appeal expressly agreed. Moreover, that approach was adopted by the Court of Appeal in the case of Wandsworth London Borough Council v Secretary of State for Transport, Local Government and Regions, 19th February 2003, [2003] EWCA Civ 142. It also has been adopted in numerous first instance decisions, including decisions by reference to section 54A of the 1990 Act. 48. Miss Lieven cited to me in this context a selection of cases both reported and unreported; she also being anxious that I should note (as I do) that those were decisions of judges with particular expertise in planning matters. Of these I may note by way of example the observations of Ouseley J in R v Oxford City Council ex parte J A Pye (Oxford) Ltd [2002] 2 P&CR 568, [2001] EWHC Admin 870 at page 581 of the report; and of Keene J in R v Secretary of State for Environment, Transport and Regions ex parte Tesco Stores Limited (19th October 2000) at paragraphs 27 and 28 of that judgment. Moreover, such an approach is not inconsistent with Lord Hope's and Lord Clyde's observations in the City of Edinburgh case. 49. There are in fact pragmatic reasons for this being the approach to be adopted in this particular planning context: which approach by no means of course mirrors the approach ordinarily otherwise adopted by the courts in other civil contexts: for example, interpretation of statutory instruments or of commercial contracts. For one thing, in the planning field policies and development plans of this kind are commonly drafted by planners for planners and often are very loosely drafted. They are not, putting it broadly, intended to be legally binding documents in the strict sense. For another, the relevant phrases used will often be hardly sensible of bearing a strict hard edged interpretative approach and resort will be needed to elements of value judgment: for example, "institutions standing in extensive grounds" (the Northavon case) or "existing town centre" (the Wandsworth case). Thus, the ex parte Woods approach can in fact be operated, as Miss Lieven observed, so as to reduce the potentiality for legal disputes. 50. All the same, I would, speaking for myself, sound a note of caution. The courts must be wary of an approach whereby decision makers can live in the planning world of Humpty Dumpty, making a particular planning policy mean whatever the decision maker decides that it should mean. I make the following observations. (1). First, it is plain that ex parte Woods does not sanction such an approach. As Brooke LJ makes clear, the court will need to assess, as a preliminary matter, whether the interpretation propounded by the decision maker is one that the words used are in law properly capable of bearing. (2). Second, and following on from that, if, in any particular planning case, one meaning is, on any viewpoint, highly probable but a counter meaning is advanced on behalf of the decision maker which can at best justify no epithet better than "tenuous", that, I apprehend, is not likely in the ordinary case to avail the decision maker; and in such a context the parties should not be surprised if the courts choose to adopt a robust approach. As stated by Mr George Bartlett QC (sitting as a deputy judge of the High Court) in Virgin Cinema Properties Limited v Secretary of State for the Environment [1998] PLCR 1 at page 8, there may be instances, on a point of interpretation in a relevant planning context, where the ambit of reasonableness is narrow or even nil. (3). Third, there may be instances where, even if the words of the policy taken on their own prima facie support the interpretation of the decision maker, consideration of the purpose and underlying objective of the policy in question may show that such linguistic interpretation simply will not accurately represent the true policy: see Patter and Harris v Secretary of state for Environment, Transport and the Regions [2000] 79 P&CR 214 as an example of that. (4). Fourth, decision makers will of course need to bear in mind that the adoption of a particular interpretation of a policy in a development plan in a particular case will make it difficult, at all events in the absence of convincing explanation, for them to adopt a different interpretation in another case without attracting a challenge on the ground of arbitrariness or collateral purpose or the like."[14]It follows from the above that I must determine whether the interpretation of the decision maker is one which the words can properly bear. If they do not do so, then it is conceded that his decision cannot stand.[15]I should make one other observation on the interpretation and application of policy. It involves two stages. The first is interpretation and the second is, once interpreted, its application. At the second stage the decision maker will address other material considerations which he may decide should affect whether he applies the outcome of the interpretation in full or at all.[16]It is not necessary for me to read the whole of the decision letter into the judgment, however I will set out paragraphs 3, 7, 9 and 15 to 20 inclusive:
"Main Issues 3. I consider the main issues in this case to be: a) the effect the development would have on the living conditions of neighbouring residential occupiers; b) whether satisfactory arrangements have been made towards meeting the need for affordable housing in the area ... 7. Policy HSG 1 sets out an overall housing target. Policy HSG5 gives general encouragement to new residential provision in areas of mixed use. Policy HSG 6 seeks opportunities to maximise the provision of permanent affordable housing in housing proposals. Affordable housing will be expected on sites capable of providing 10 or more units or of 0.3 hectares or more, with the appropriate amount of affordable housing to be subject to negotiation. It is indicated that in exceptional circumstance the Council may consider a financial contribution to its affordable housing fund as an alternative to on site provision. Policies HSG 7 and HSG 8 give requirements on mobility and wheelchair standards respectively. Policy HSG 11 indicates that, in considering the appropriate density and mix of dwelling sizes, regard will be given to the need to use land as intensively as is compatible with the protection of the quality, character and amenity of the area and the contribution to meeting housing need for all sections of that community. Factors are identified that will be taken into account, with an expectation that a reasonable number of small units will be provided. Policy HSG 12 deals with the particular implications of backland and infill development, including consideration of any significant loss of amenity space or material loss of privacy as a result of overlooking adjoining houses and/or their back gardens. Policy HSG 18 refers to standards that will normally be applied in considering residential proposals... 9. The Council in 2003 issued supplementary planning guidance on affordable housing. At the hearing it was agreed that this should form the basis for assessing the affordable housing arrangements for the proposal in conjunction with the development plan policies, and I accord it significant weight... Affordable housing 15. Provision for affordable housing in association with the development is expected under UDP policy HSG 6. There is no dispute in relation to the principle of providing a financial contribution in lieu of on site provision of affordable housing. This is allowed for under the policy, and was an approach supported by the previous Inspector. There is also agreement in relation to the methodology to be applied in calculating the appropriate contribution pursuant to the supplementary planning guidance (SPG). This deals with the equivalent proportion of units sought, dwelling sizes, and expectation regarding the availability of public subsidy towards affordable housing (Total Cost Indicator). 16. Dispute arises in relation to the open market value of units that should be used in the relevant formula so as to derive the difference between this and the relevant TCI, which is then applied as the factor in calculating the contribution. The appellant's original offer of £225,119 was based on research of asking prices of properties within the area. The Council is requesting a contribution of £1,268,960 cited two identified comparisons within the immediate vicinity of the site. The appellant subsequently increased the offer to £300,000 and this is incorporated as a planning obligation within the undertakings. The Council continues to seek its original sum, and therefore the difference between the parties remains considerable. 17. I regard a number of points as relevant in assessing these respective positions. In the SPG there is no definition of the term 'in the same location' as the basis for calculating open market value. The appellant's research was based on market details of 46 one and two bedroom properties centred on the TW12 postcode area, then used to derive average prices. These figures appear to be verified by the Land Registry data for TW12. In my opinion the geographical basis for this approach is reasonable, and the analysis relatively robust. The appellant fairly points out that the two original comparators used by the Council are of new high specification developments, and not necessarily indicative of wider market prices. The further examples brought by the Council to the hearing were limited and undocumented. 18. The SPG refers to the intention of the formula as being that a similar ratio of market:affordable housing would be achieved as if the units were provided on site. The Council argued at the hearing that only new build comparisons should be considered. However, the UDP refers to the affordable housing fund to which contributions are directed as being used either for new affordable housing or to bring existing private properties back into use as affordable housing in pursuance of housing and planning objectives. I have no reason to doubt that these objectives could be achieved with the types of property identified in the appellant's research. The formula refers to 'open market value of units'; it does not specify only new build. While there will clearly be a variation in the number of units that could potentially be achieved depending on location and other factors, I do not regard the calculation basis of the appellant's contribution as incompatible with the purposes of the off site formula. 19. As a further matter, both the London Plan and the UDP refer to details of affordable housing being agreed by negotiation. This reflects advice in Circular 06/98. Reference is also made in policy to a need for flexibility having regard to particular circumstances. There is some information before me regarding the viability of the proposal. The Council criticises this information for lacking full details of the individual premiums over market values payable to the existing owners of the site, identified at the hearing as totalling 26%. Nevertheless, the written brief of the Council's adviser on viability, while referring to a lower norm for such premiums, also states that the submitted appraisal calculations are not unreasonable. In identifying the premium as the factor preventing payment of the off site contribution sought by the Council, it suggests that the alternative would be the scheme not proceeding. I acknowledge that brownfield development is not unusual in the Borough, but in this case I accept the appellant's explanation of the relatively high premium based on the number of different owners involved in assembling the site. In this respect I take into account the intention of the London Plan that development should be encouraged rather than restrained, and the reference of 06/98 to the need to achieve a successful housing development. 20. Negotiations will lead to variable outcomes. However, having regard to the evidence before me, I consider that the affordable housing contribution that would be secured by way of the unilateral undertakings is reasonable and complies with the aims of the development plan in this respect."
[17]The Inspector's approach is, first, to take the value of units to be that derived by averaging out the values achieved in transactions of any one bedroom or two bedroom properties in the postcode area in which the site lies, and, secondly, to include within that exercise all types of such units, whether newly built or not. Of course, in both cases he is doing so within the relevant size band.[18]Is that approach of the Inspector a reasonable interpretation? I start by the context. The policy in the Unitary Development Plan seeks the provision of units within schemes which are given planning permission; in other words, in the way in which the policy is preferred to operate there would be built on the site a number of units. If the contribution route is followed, the Council is entitled to a contribution whereby, in the words of the UDP, "equivalent provision" is enabled elsewhere, and, as already observed, more detail is given in supplementary planning guidance. There is another passage in supplementary planning guidance to which it is helpful to refer, and that is on page 112 to 113, it is section 8, called "The amount of affordable housing to be provided". "8.1. Some sites will involve 100% affordable housing; for example a site brought forward by a RSL, or sites where the principle of a change of use from another land use has been established as an exception to policy. 8.2. On other sites the amount to be provided will have been specified, for example on a UDP proposal or in a site brief. 8.3. In the UDP First Review, as recommended to be modified by the Inspector, Policy HSG 6 states that 40% affordable housing should be provided over the Plan period. Given the relatively small number of sites owned by the Local Authority or RSLs, or otherwise available as an exception to other policies, the implication is that 40% is the minimum which should be provided on sites exceeding the threshold. 8.4. In line with the Policy, the primary measure of the amount of affordable housing will be a proportion of units. However, this proportion should be reflected in the floorspace provided. In relation to specific sites, it is expected that 40% of floorspace will be affordable housing of a type and mix considered appropriate by the Council."[19]In my judgment, 17.3 and 17.4 of supplementary planning guidance are only capable of meaning that one is seeking to ascertain the value of units as if the preferred route of on site provision had been taken. They are also directed to valuing equivalent provision, i.e. new built units, not existing units. Mr Greatorex and Mr Philpott, for the Secretary of State and the interested party respectively, were driven to argue that the only factor relevant to determining equivalence was the number of the units and whether they were one or two bedroom units within the agreed size bands.[20]The claimant's interpretation of policy is that it requires that one assesses the value of the units which would notionally be built on the appeal site. One does so by assessing the market value of such units. The developer's contention, which the Inspector supported, is that one takes the number and size of the units. One then looks at the value of transactions throughout the postcode area for properties of that size, whether newly built or not, and then take an average value per transaction. One then simply takes that as the value to be used for the calculation of the contribution. That approach was supported by the Inspector.[21]It is conceded by the Secretary of State and the interested party that the claimant's interpretation could be correct. I regard the developer's interpretation, which the Inspector accepted, as misconceived and obviously wrong. I do so for the following reasons.a. First, it has the effect of negating the fundamental objective of the policy, which is that the provision be equivalent. If new built units command higher prices than second hand units (as was accepted) that is not by chance or whim, it is because they are more attractive places to live. If the market regards a flat in a house conversion as not being the equivalent of a new built flat, how could a policy aimed at making equivalent provision on a value basis do so?b. Second, as the Inspector says in paragraph 16, the point of the exercise is to identify the relevant market value of units so that the "equivalent provision" contribution can be calculated. Assessing the market value of proposed development is a very common place valuation exercise and presents no difficulties at all. One has an identified site, with an identified type of development. All the matters which inform a valuation are known, such as distance to facilities, visual appearance, whether the neighbouring uses are noisy or quiet, and so on. One may properly have regard to other transactions in the area in which the site lies to inform that judgment, i.e. use them as comparables, in which process the valuer will use his judgment to identify matters which differ as between the comparables and the subject site. Mr Greatorex and Mr Philpott submitted that such a process is something to be found in the Lands Tribunal, as if that made it other than normal. To hear their submissions one would have thought that valuation of this straightforward kind was a black art of a subtlety beyond the scope of a planning inquiry. I emphatically reject that contention. We are not talking here of some analysis requiring a sophisticated series of assumptions such as residual valuation, but of the everyday process of assessing value by the use of judgment having regard to the value of recent transactions in the property market. It is what every estate agent does many times a day when valuing property. The Inspector has adopted an interpretation which requires a different method. It requires one to take an average of all transactions in an area and then derive a value for units notionally constructed somewhere in that area on an unknown site or sites. It prevents any realistic attempts at valuation as it prevents any judgment being formed on a site specific basis. It also makes no allowance for any differences between properties or locations.c. It has the extraordinary effect that if the site in question is in a less attractive location than the run of properties in the area, his interpretation would drive the market value up above the market value of any units constructed on the site.d. It follows also that the Inspector's interpretation has the effect that, first, if the site in question is a more attractive site than the run of sites in the area, the developer has his contribution assessed on a lower value than is actually the case for his site; and I repeat, if the site in question is less attractive than the run of sites in his area, he would have it assessed on a higher value than is actually the case. That is absurd. No interpretation of policy which produces that absurd result is reasonable.[22]Mr Greatorex and Mr Philpott also seek to say that because the fund generated by the contributions could be used to refurbish existing property or bring existing properties back into affordable housing use, that supports the Inspector's interpretation. I reject that argument. The policy in issue relates to the calculation of the contribution, not the use to which the fund of which it will form part will be put.[23]It follows, in my judgment, that the Inspector has not had regard to the development plan policy as required by the statute and has used an interpretation which cannot be correct. That is not to say that the Council's assessment of the market price is correct, but it is certainly the case that the developer's was wrong. I express no view at all on what the proper figure is.[24]I have not lost sight of paragraph 19 of the decision letter. Once interpreted, the decision maker then has to consider the application of the policy. That may involve asking whether the level of the calculated contribution would so affect viability that the scheme might not go ahead, and if not whether that would be an undesirable consequence. But before he gets to that stage, he must interpret the policy properly and calculate the contribution in accordance with the policy. That the Inspector failed to do.[25]I should add that I have some sympathy with the Inspector. This was a classic case where cross examination would have exposed the flaws in the developer's argument, but that is not what happens at an informal hearing. This was one of those types of planning dispute where the Inspector should have insisted on an inquiry, where there would have been formal cross examination which would have tested the two rival methods of calculation.[26]As to Miss Robinson's other grounds on behalf of the claimant it is unnecessary for me to express a view, save on ground 3. Miss Robinson complained that the Inspector prevented the Richmond witness from giving the Inspector up to date information on the market prices of new build units in the area. One related to a site that everyone knew about, the other related to a new site. That evidence on behalf of the Borough was put in to the Administrative Court on 27th June of this year. At the hearing of this challenge the Secretary of State sought to rely on a statement of the Inspector made as late as 1st December 2006 and filed on 4th December 2006. The interested party, who had already filed a second witness statement as recently as 22nd November 2006, now sought to file further evidence at the hearing in the form of an undated third statement, which was sent to the claimant on 4th December 2006. I refused to allow the late evidence of either the Secretary of State or the interested party to be given. There was no reason at all why it could not have been filed several weeks ago.[27]Looking at the evidence which was admitted, there is a conflict of evidence on what happened at the hearing about the further evidence on valuation. However, as Mr Philpott pointed out, the evidence did not support a higher figure than already argued for by the Council. Miss Robinson says that it would have demonstrated that the Council's figure was supported by market evidence.[28]If the interested party did claim at the hearing that it was new evidence which should not be admitted, I would regard that as spurious, for any competent chartered surveyor such as the interested party's witness would have made himself familiar in that week with all recent transactions in the area so as to be ready for the hearing. However, given my finding on the principal grounds, I decline to make any factual findings on this issue.[29]It follows from my judgment that there must be judgment for the claimant. MR MOULES: I am grateful, my Lord. In light of your Lordship's comments, I ask for the claimant's costs. HIS HONOUR JUDGE GILBART QC: Have you provided a list of your costs to the Secretary of State? MR MOULES: A summary has been provided to both the defendants. HIS HONOUR JUDGE GILBART QC: I think you can only get one set of costs. I am not so much in your favour that I am going to award costs twice. Is there any objection? MISS BUSCH: No objection in principle, my Lord, but I do have some comments on the schedule. HIS HONOUR JUDGE GILBART QC: Yes. MISS BUSCH: First, the work done on documents. 21 hours, we say is excessive. HIS HONOUR JUDGE GILBART QC: What do you say would the right figure be? Have you put in a counter schedule? MISS BUSCH: We do have a schedule actually. HIS HONOUR JUDGE GILBART QC: Good, let us have a look. MISS BUSCH: Work done on documents, 17 hours. We would ask that to be reduced. HIS HONOUR JUDGE GILBART QC: What effect does that have? What is your figure then? I am just finding out where the 21 hours is to be found. MISS BUSCH: I do not actually have a calculator, my Lord. HIS HONOUR JUDGE GILBART QC: I have your figure, your figure is £2,528. MISS BUSCH: Yes, my Lord, but that is at £160 an hour as opposed to HIS HONOUR JUDGE GILBART QC: I know, I am getting that. So their figure is 21 hours at £75 an hour, right? MISS BUSCH: Yes, my Lord. HIS HONOUR JUDGE GILBART QC: Your figure is 17 at £160 an hour. You say that they should be allowed more for documents. Your figure is £2,528 and theirs is £1,575. MISS BUSCH: Yes, my Lord, but it is the number of hours that we say should be reduced. Secondly, attendance at hearing, 8 hours. Obviously I was not at the hearing, but I understand it was not 8 hours long. HIS HONOUR JUDGE GILBART QC: It took all day. There was a case before it which finished within 25 minutes, but the parties would have been here presumably by about 10 o'clock. MISS BUSCH: There is a separate figure for hours travelled and waiting of 2 hours. HIS HONOUR JUDGE GILBART QC: You say that the hearing time is too long? MISS BUSCH: Yes, my Lord. I was told it commenced at about 11 and finished at 4.30 with an hour for lunch. HIS HONOUR JUDGE GILBART QC: Right. MISS BUSCH: Secondly, counsel's fees. HIS HONOUR JUDGE GILBART QC: So what do you say, for the hearing it should be 4 hours? MISS BUSCH: Yes, my Lord. HIS HONOUR JUDGE GILBART QC: Your figure is too low, there is at least 4 and a half just in court. MISS BUSCH: 5 hours including this morning. HIS HONOUR JUDGE GILBART QC: Right. MISS BUSCH: Then finally counsel's fees. Taking into account the fact obviously that my learned friend Miss Robinson is of some seniority HIS HONOUR JUDGE GILBART QC: You have no idea how old that makes me feel, I remember her when she was a pupil. MISS BUSCH: We say a combined fee of in excess of £8,000 for a hearing such as this one is excessive. HIS HONOUR JUDGE GILBART QC: What figure have you suggested? MISS BUSCH: Mr Greatorex, it must be said, is considerably more junior, but our figure is £480 for advice and £560 for the hearing. HIS HONOUR JUDGE GILBART QC: I am sorry, say that again please. MISS BUSCH: £480 for advice and £560 for the hearing. HIS HONOUR JUDGE GILBART QC: I am sorry, £560? MISS BUSCH: Treasury counsel fees, my Lord. HIS HONOUR JUDGE GILBART QC: Well MISS BUSCH: Plus around about £120 for my attendance this morning. MR PHILPOTT: If it helps, there is a fixed system for the Treasury panel. It is a hourly rate and it is very low. HIS HONOUR JUDGE GILBART QC: I know, but that rate is not applied to brief fees on behalf of claimants. MR PHILPOTT: It applies to Treasury counsel. HIS HONOUR JUDGE GILBART QC: Certainly. They do it for the honour, no doubt, Mr Philpott. You are not saying that the Treasury rate should be applied to the claimant, are you? MISS BUSCH: No, my Lord, of course not. HIS HONOUR JUDGE GILBART QC: You are asking me to express a view as to whether the brief fees are high, brief fees and advices and conferences coming to a little over £8,000, for how many conferences? MR MOULES: Four conferences. HIS HONOUR JUDGE GILBART QC: Four? MISS BUSCH: Quite, my Lord, we would say four conferences for a section 288 appeal HIS HONOUR JUDGE GILBART QC: It depends on the section 288 appeal. It does depend. Some section 288 appeals take half an hour to prepare in conference, some take two days, some take longer. You say four conferences is a bit de trop, do you? MISS BUSCH: We do, my Lord. In any event, there appears to be an overlap between counsel's fees and the 21 hours spent on documents by the solicitor, bearing in mind as well that the matter was no doubt dealt with by the Council's legal team for the purposes of the hearing before the Inspector as well. HIS HONOUR JUDGE GILBART QC: Thank you. Anything else you want to say? Mr Moules, anything in response? MR MOULES: Simply, my Lord HIS HONOUR JUDGE GILBART QC: The one aspect I am troubled about is having to have four conferences. MR MOULES: I am instructed that there were two conferences and two telephone conferences. HIS HONOUR JUDGE GILBART QC: Right. Thank you. Well, I adopt the normal practice that I look at the claim for costs overall and ask whether it is excessive. I do think that the claimant's costs of £11,656.25 is such that one has to look at it. There are two areas of challenge made by the Secretary of State. The first is that it should not be 21 hours of looking at documents, but should be 17. I reject that argument. 21 hours of looking at the documents seems to me to be perfectly reasonable. If it had been said that it was something like 8 hours and one then looked at the gap, there may have been a more interesting argument, but when the gap is only 4 hours I really do not see the point of that. The other area of challenge is made as to the fees claimed by counsel. I see nothing wrong at all with the brief fee sought and the cost of today, I am not going to name the figure but I do not see any objection to that. I think that the fee for conferences is on the high side and I am going to reduce the bill of costs by £1,500, plus VAT, whatever that may be. The VAT is something in the order of £257 pounds, something like that. Mr Philpott? MR PHILPOTT: My Lord, I have an application, it does not relate to costs, it is for permission to appeal. Now, my Lord, I make my submissions on both grounds, that is realistic prospect of success and a point of public importance. I say in advance that the first point I of course acknowledge the emphatic terms your Lordship has expressed his view on the point of interpretation. Nevertheless, it is a point of interpretation which we say, principally for the reasons in my skeleton argument, there is a realistic prospect a different judge might take a different view. Unless it would assist your Lordship I do not propose to go through those reasons again now, I have expressed them clearly in my written submissions. So far as the second limb is concerned, we say in any event this is a point of public importance, not just for the provision of affordable housing in the London Borough of Richmond, but it has potential implications in other boroughs who may take note of this decision and may well have similar problems, but those are the two reasons we say this is an appropriate case for the Court of Appeal to consider. I also separately ask your Lordship for an order that, whether permission is given or not, the time limit for submitting the appellant's notice, which is 21 days, should be ordered to run in this case from delivery of the transcript of your Lordship's judgment rather than from today, to give my clients an opportunity to look at that and for me to have an opportunity to look at that and advise whether to take the matter forward. Unless I can assist further on the merits of my application, those are my submissions. HIS HONOUR JUDGE GILBART QC: As with all your submissions, Mr Philpott, it is admirable for its directness and clarity. MISS BUSCH: My Lord, I do not believe I have anything useful to add to Mr Philpott's submissions, but I respectfully adopt them and second them. We also seek permission to appeal and we would respectfully ask for 21 days of receipt of the transcript in the event that my Lordship should refuse permission. HIS HONOUR JUDGE GILBART QC: Mr Moules? MR MOULES: In relation to the prospects of success, I would remind your Lordship of the emphatic terms in which your Lordship expressed his judgment and the consequences which were pointed out from the defendant's interpretation. In relation to public importance, this does turn on the wording of the DPG of a particular council, and in my submission there would be no wider public importance. HIS HONOUR JUDGE GILBART QC: I do not consider there is any realistic prospect of success in this appeal firstly for the reasons given in my judgment and, secondly, I do not consider it is of sufficient public importance I do not want that phrase to be misunderstood, I do not mean that it is of sufficient public importance to justify the grant of permission to appeal, I agree with Mr Moules that this relates to the interpretation of one policy in the UDP of supplementary planning guidance of one London Borough. Permission to appeal is refused. MISS BUSCH: May we have 21 days from receipt of the transcript? HIS HONOUR JUDGE GILBART QC: Yes. It seems to me to be a perfectly reasonable request. Knowing the speed at which I work, Miss Busch, if the shorthand writer gets it to me I normally turn it round within a day. Thank you for your assistance.