In our blog of 3 September 2020, we brought you news of the challenge to the recent changes to the Use Classes Order and the Permitted Development Rights (“PDR”) regime. The action group bringing the claim sought to quash the statutory instruments which bring about the changes to the Use Classes Order (including the introduction of the much-vaunted new Class E) and PDR (in particular granting rights to provide new residential units in a variety of types of development). The claim was heard in mid-October and the High Court has recently handed down its judgment.
In what will be a relief to the government, the challenge failed. The High Court found that the adoption of the changes to the Use Classes Order and the reforms to PDR was legal, and the new rules remain in force. Although the Court found that the government had failed to carry out consultation, which it had promised to do, this wasn’t considered to be fatal to the reforms. The particular circumstances of the COVID-19 pandemic were held to be adequate justification for this failure – even though the changes to the Use Classes Order and the PDR regime could remain in force long after the pandemic ends.
On the face of it, the High Court’s decision is positive news for a property industry navigating its way through some of the choppiest trading conditions in living memory. However, the action group bringing the claim has said it will appeal the decision. In that context, those dealing with use clauses in leases may wish to see where any appeal goes before they commit to referencing the new use classes.
The Use Class that keeps on giving
And just when you thought that no more excitement could happen in the planning world, the government has launched a consultation on potentially far reaching proposals to allow change of use from any Commercial, Business and Service (the new Class E) to residential (Class C3). This would allow any property falling within Class E on 1 September 2020 to change to residential property without requiring planning permission, although not vice versa.
Vibrant town centres and the COVID-19 response
The new Class E came into effect on 1 September 2020 and spans a significant range of uses, from retail to sport, to crèches and nurseries. The government considers that owners of such properties should have greater flexibility to move between uses and that this, in turn, will enable businesses to respond to changing market demands. Key to this strategy is the impact of COVID-19 on the retail sector, with reduced footfall and the increased prevalence of home working. The government is hoping that the new PDR to allow this change of use will not only address housing need, but will also increase footfall for those retail units that have survived the pandemic by increasing the numbers of local residents, while offering those unable to sustain businesses an alternative option.
Any exceptions?
The proposals relate to England only and would apply to any property within Class E regardless of the size of the building (part or whole) to which the PDR would apply. Properties with certain designations, such as listed buildings, would fall outside of the PDR. The change, if approved, would come into force on 1 August 2021.
What else is in the consultation?
The consultation also seeks views on speeding up the approval process for public infrastructure improvements and to introduce a further new PDR allowing educational and medical establishments to increase their facilities by up to 25%.
Next steps
The consultation remains open until 28 January 2021. The timing of this consultation also demonstrates the government’s confidence in the changes it made to the Use Classes Order and the Permitted Development Rights in September. The failed challenge to those Use Class changes has clearly fuelled the government’s appetite to deliver on its promise of a reshaped planning system. We’ll keep you abreast of developments and your usual Hogan Lovells contact will be able to advise on the best approaches in the meantime.
Authored by Hannah Quarterman, and David Wood
Harry MacGregor contributed to this article
