Inner House case considering an appeal relating to a section 75 agreement between Elsick Development Company and Aberdeen and Aberdeenshire Strategic Development Planning Authority. EDC wished to construct a development at Elsick (near Stonehaven). The agreement provided for EDC to make payments to a Strategic Transport Fund in terms of non-statutory Supplementary Planning Guidance. EDC had concerns that the planning guidance was invalid and, in terms of the agreement, no contribution was to be paid if the guidance was found to be invalid.

EDC argued before the Inner House (amongst other things) that the Supplementary Planning Guidance was contrary to national planning policy as it failed to comply with the requirement that any planning obligation must relate directly to the development proposed (as is provided for in the Scottish Government Planning Circular “Planning Obligations and Good Neighbour Agreements (Circular 3/2012)).

The court allowed the appeal finding that:

“It is a fundamental principle of planning law that a condition attached to the grant of planning permission, whether contained in a section 75 Agreement or otherwise, must “fairly and reasonably relate to the permitted development” …  This principle is reflected and explained by the Scottish Government Circular (3/2012) …  This makes it clear to planning authorities that an obligation must be “related and proportionate in scale and kind to the development”

 However, the court concluded that the Strategic Transport Fund was designed to pay for transport projects and infrastructure (“interventions”) which were not directly related to the proposed development.

 “The STF, and the requirement in the statutory Supplementary Guidance (SG) to contribute to it, may be regarded as a sound idea in political or general planning terms.  It may be seen as an imaginative idea which allows advanced strategic planning objectives to be achieved in a structured manner, financed by new development.  That does not, however, permit the imposition of an obligation on a developer to contribute to an intervention which is simply not related to the proposed development…  It may be that legislation could authorise the type of contribution envisaged by the [planning authority] …  but it has not yet done so in Scotland.”

 The full judgement is available from Scottish Courts here.