Running up that Hill(side) - Supreme Court strikes a blow against cakeism

Back in December 2020 we analysed the Court of Appeal's decision in the case of Hillside Parks Ltd v Snowdonia National Park Authority [2020] EWCA Civ 1440, in which the Court held that implementation of a masterplan pursuant to a 1967 permission was no longer possible due to developments carried out under later permissions (our December 2020 article, which summarises the facts of the case and the Court of Appeal's decision, can be found here). On Wednesday 2 November, the Supreme Court handed down its judgment in the landowner's appeal (Hillside Parks Ltd v Snowdonia National Park Authority [2022] UKSC 30). The Supreme Court unanimously rejected the appeal and in doing so has provided very helpful clarification of the legal principles governing overlapping planning permissions. Headline points for developers arising from the Supreme Court's decision are summarised in "Key Issues" below.

The decision is particularly relevant to developers of multi-phase developments authorised by a single masterplan planning permission. The use of "drop-in" applications to authorise changes to a specific plot or plots within a wider masterplan have become a commonplace means of responding to tenant requirements or altering market conditions, but the Supreme Court's decision has profound consequences for this approach.

Whilst the Supreme Court has brought welcome certainty in this area of planning law, their decision also serves as a salutary reminder that overlapping planning permissions will always require particular scrutiny. Projects for which drop-in permissions have already been implemented will need to be reviewed carefully to check that they have not caused future development phases to lose the benefit of an existing planning permission.

We have prepared a briefing note in which we consider the Supreme Court's decision and the practical implications for landowners and developers.  If you would like a copy of our full briefing, please contact us.

Key issues

Here are the headline points for developers arising from the Supreme Court's decision:

• The existing legal principles on overlapping planning permissions have been reaffirmed, and uncertainties arising from previous cases have been clarified.
• Implementation of a subsequent planning permission for physically incompatible development (often called a "drop-in" application) will result in any further development under an existing planning permission being unlawful but will not invalidate development already carried out.
• Only material physical incompatibility will have this effect: non-material departures from a planning permission are acceptable.
• Severability of multi-phase developments was ruled to be theoretically possible, but in most cases will be difficult to achieve and unlikely to be accepted by local planning authorities.
• Major material changes to masterplans are likely to require a new planning application for the whole site as a result of the decision, highlighting the importance of structuring planning applications carefully to maximise flexibility from the outset.
• "Slot-out" strategies to overcome physical incompatibility were neither endorsed nor deprecated by the Supreme Court, leaving open the use of this workaround in appropriate circumstances.
• When purchasing land with the benefit of planning permission for a larger site, it is essential to check whether any planning permissions on the larger site affect the implementability of development on the land to be purchased.
• When selling land forming part of a larger site, it is essential to impose covenants on the purchaser not to implement any development that would affect the implementability of development on the retained land.
• Section 96A consents are not necessarily required to authorise non-material deviations from an approved scheme, but are recommended where there is any uncertainty whether the amendments are material or not.

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