Unilateral Undertakings - Avoid Unnecessary Payments

Planning Obligations

When obtaining planning permission, it is often necessary to enter into planning obligations dealing with matters such as the payment of a financial contribution towards infrastructure costs or a restriction on hours of use. The obligations are usually agreed with the local planning authority and documented in a section 106 agreement. However, it is also possible to volunteer an obligation by providing a unilateral undertaking. Giving such an undertaking can enable a developer to ameliorate a perceived objection to a proposed development and so increase the prospect of permission being granted on appeal.

A Problem with Unilateral Undertakings

A recent decision of the Court of Appeal has highlighted a problem which can arise when a unilateral undertaking is given in advance of a planning appeal. It is usual to make the undertaking conditional on planning permission being granted. However, that condition alone is not sufficient to prevent the obligation from taking effect before it has been established that it is really necessary and, crucially, once the undertaking becomes binding, it cannot be unilaterally withdrawn, even if it becomes clear that the planning permission would have been granted without it.

The Recent Case

The case arose out of the refusal of planning permission for a residential development. One of the grounds for refusal related to the lack of adequate services, amenities and infrastructure. The local planning authority indicated that this could be dealt with by a unilateral undertaking providing a financial contribution of £170,500. The developer appealed against the refusal and provided the suggested undertaking. The appeal succeeded, but in his decision letter the inspector said the contribution was unnecessary. Despite that, the Council still sought to enforce the undertaking, although it did reduce the amount of the contribution to £140,000.

The developer applied for judicial review of the...