High Court rejects challenge to St Ives neighbourhood plan restricting second homes

The St Ives Area NDP was backed by 83% of residents of the Cornwall seaside town in a referendum in May. A Penzance-based architectural firm challenged Cornwall Council's decision to put the NDP to referendum on the grounds that the drafted policy breached the Strategic Environmental Assessment (SEA) regulations, as well as human rights legislation.

However, High Court judge Mr Justice Hickinbottom ruled that RLT Built Environment "[fell] far short of showing that the [local] Examiner's conclusion was irrational" when she backed the NDP.

"The Examiner found that the draft plan was compatible with the relevant EU obligations, which was a matter of planning judgment for her," he said.

Described by the judge a "highly desirable tourist and leisure destination", St Ives is a small town on the North Cornwall coast. It also has one of the highest proportions of second homes and holiday lets in Cornwall. According to a supporting statement published alongside the NDP, the proportion of dwellings in the area not occupied by a resident household increased by 67% in the decade between 2001 and 2011, to 67%; and the "socio-economic effects" were "being felt by the local community".

To address this, policy H2 of the NDP states that new open market housing which is not intended to replace existing dwellings "will only be supported where there is a restriction to ensure its occupancy as a Principal Residence". The policy defines 'principle residence' as "those occupied as the residents' sole or main residence, where the residents spend the majority of their time when not working away from home".

Before a draft NDP can progress to a referendum, the relevant local planning authority must be satisfied that it complies with all relevant EU laws. These include the requirements of the SEA Directive. RLT Built Environment argued that the policy did not comply with Directive, making the referendum invalid.

Dealing with the arguments based on the SEA Directive first, the judge pointed out that the directive was "expressly procedural in nature".

"The SEA Directive is designed to ensure that potentially environmentally-preferable options that will or may attain policy objectives are not discarded as a result of earlier strategic decisions in respect of plans of which the development forms part," he said. "The discarding of environmentally-inferior options is not its concern."

"As [RLT] accepted, the relevant policy objective was to reduce the proportion of dwellings in the area that are not used as a principal residence ... That was a legitimate policy objective … The preferred option for achieving that objective was Policy H2. A 'reasonable alternative' for SEA purposes would have been any potentially environmentally-preferable, or environmentally-equal, option which, in the assessment of the council, would, or sensibly might, achieve that objective," he said.

RLT had argued that the council had not considered the "obvious alternative" of increasing market housing to the extent that, even if the second-home market would not become saturated, some additional housing for those who wished to have their principal residences in the area would, in practice, have likely become available. However, by the judge's reasoning, this could not possibly be a 'reasonable alternative' for the purposes of the SEA directive as building more houses could not be at the least environmentally equal to the option that was chosen.

The judge also dismissed RLT's objections based on policy H3 of the NDP, which imposed limits on the nature of housing development which could occur once the number of new dwellings needed during the planning period had been built, stating that it was right for the SEA for the NDP to focus on the various means of accommodating the number of units allocated to the area by the local plan, rather than to test alternatives to the allocation itself..

"This case provides important clarity to the role of the SEA Directive and neighbourhood plans," said planning law expert Matthew Fox of Pinsent Masons, the law firm behind Out-Law.com.

"As neighbourhood plans must take account of local plans, it shows that the focus of the SEA of the neighbourhood plan can be on the alternatives of 'how' policy is delivered at a neighbourhood level. It also emphasises the importance of identifying an evidenced objective at an early stage against which the environmental effects of the alternatives must be tested – one can see that the wording of such objectives could be carefully crafted to avoid 'undesirable' alternatives at an early stage," he said.