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A Day in Court: The Supreme Court Considers Disposals of Open Space by Local Authorities


The Supreme Court has handed down its judgment in the case of R (on the application of Day) v Shropshire Council [2023] UKSC 8. The unanimous judgment was given by Lady Rose and is a lesson in what can go wrong when a local authority does not follow statutory requirements when disposing of land.

The background to the case was that certain land in Shrewsbury was acquired in 1926 by the predecessor local authority to Shropshire Town Council (“Shropshire”). The land was apparently acquired as playing fields or recreation grounds and parts were later used as allotments and for tree husbandry before the site fell into disuse in the 1990s or 2000s although it appears that the public had access at all material times.

In 2016 Shropshire obtained outline planning consent for the development of 8 eco-homes on the land. This development did not proceed. Shropshire subsequently sold the land in 2017 to a developer (“CSE”) who applied for planning permission for 17 dwellings. This application faced vigorous local opposition on the basis that the land was public open space and part of a recreation ground. This opposition, led by the apparently tenacious and committed researcher Dr Day (“Day”), started as objections to the planning application by CSE, then continued at a judicial review of the decision to grant planning consent in the High Court ([2019] EWHC 3539 (Admin)), and thereafter appeals to the Court of Appeal ([2020] EWCA Civ 1751) and ultimately the Supreme Court where Day was eventually vindicated after being unsuccessful at all earlier stages.

The question of whether the land was a public open space was apparently not considered at the time of the initial disposal to CSE, who were unaware of this possibility (although Shropshire and the local planning authority ought to have been). There was therefore no publicity of the sale by Shropshire and no opportunity for local people to object to the sale until CSE later applied for planning consent. This proved to be important later due to the statutory provisions under which local authorities can hold and dispose of certain land.

Relevant local authorities are empowered under section 164 Public Health Act 1875 and section 9 Open Spaces Act 1906 to acquire, lay out and maintain open spaces, parks and recreation areas for the enjoyment of the public as open spaces. Section 10 of the 1906 Act provides that open spaces acquired under that Act are to be held by the local authority on trust for the enjoyment of the public as open space. The 1875 Act contains no express declaration of trust but it has been held to create one in any event (see R (Friends of Finsbury Park) v Haringey London Borough Council [2017] EWCA Civ 1831).

Whether the land is acquired or held by a local authority for the purposes of the 1875 or 1906 Acts is largely a question of evidence. Often the statute giving the authority a power to acquire land is set out in the conveyance, transfer or other relevant deed. In other cases, however, an inference must be made from relevant evidence, with the starting assumption being that a local authority being a creature of statute must be exercising a certain statutory power. Minutes of committee meetings, records of maintenance liabilities and budget use, byelaws and records of appropriation to one statutory purpose to another will all be relevant. In this case the position was unclear enough for the first instance judge to need to review the available evidence and make findings, but by the time the case reached the Court of Appeal it was common ground that the land had been held by Shropshire on statutory public trust.

Assuming therefore it is clear that a public trust arises on the land, what are the local authority’s powers to dispose? The main power of a local authority to sell is section 123 of the Local Government Act 1972 which is worth setting out in full:

123  Disposal of land by principal councils

(1)     Subject to the following provisions of this section, [and to those of the Playing Fields (Community Involvement in Disposal Decisions) (Wales) Measure 2010,] a principal council may dispose of land held by them in any manner they wish.

(2)     Except with the consent of the Secretary of State, a council shall not dispose of land under this section, otherwise than by way of a short tenancy, for a consideration less than the best that can reasonably be obtained.

[(2A)     A principal council may not dispose under subsection (1) above of any land consisting or forming part of an open space unless before disposing of the land they cause notice of their intention to do so, specifying the land in question, to be advertised in two consecutive weeks in a newspaper circulating in the area in which the land is situated, and consider any objections to the proposed disposal which may be made to them.

[(2AA)     …

(2B)     Where by virtue of subsection (2A) above [or in accordance with the provisions of regulations made under section 1 of the Playing Fields (Community Involvement in Disposal Decisions) (Wales) Measure 2010] a council dispose of land which is held—

(a)     for the purposes of section 164 of the Public Health Act 1875 (pleasure grounds); or

(b)     in accordance with section 10 of the Open Spaces Act 1906 (duty of local authority to maintain open spaces and burial grounds),

the land shall by virtue of the disposal be freed from any trust arising solely by virtue of its being land held in trust for enjoyment by the public in accordance with the said section 164 or, as the case may be, the said section 10.]

The 1972 Act then continues at section 128:

128  Consents to land transactions by local authorities and protection of purchasers

(1)     …

(2)     Where under the foregoing provisions of this Part of this Act or under any other enactment, whether passed before, at the same time as, or after, this Act, a local authority purport to acquire, appropriate or dispose of land, then—

(a)     in favour of any person claiming under the authority, the acquisition, appropriation or disposal so purporting to be made shall not be invalid by reason that any consent of a Minister which is required thereto has not been given or that any requirement as to advertisement or consideration of objections has not been complied with, and

(b)     a person dealing with the authority or a person claiming under the authority shall not be concerned to see or enquire whether any such consent has been given or whether any such requirement has been complied with.

The principal question to be decided by the Supreme Court was therefore whether land disposed of by a local authority without complying with section 123[2A] of the 1972 Act was thereby transferred free of the statutory public trust imposed by the 1875 and 1906 Acts by virtue of section 128(2).

In summary, the Supreme Court held that it was not. The effect of s128(2) of the 1972 Act was to ensure that a purchaser’s legal title could not subsequently be invalidated by a failure of the selling local authority to obtain the required consents. It did not act as a means to bypass the public statutory trust affecting the land when a clear procedure for doing so had been provided a few sections earlier by section 123[2A] of the 1972 Act. In this case the procedure in section 123[2A] had not been followed and so the statutory public trust continued to apply to the land which was now unimpeachably in the ownership of CSE. The Supreme Court therefore allowed Day’s appeal and quashed the grant of planning permission.

As noted by Lady Rose, this leaves “a rather messy situation” both in this case and for parties dealing with potential development land now or previously owned by local authorities. CSE now own land purchased for development which cannot be developed due to a statutory public trust. The Court did not address how CSE and Shropshire might resolve this situation, other than commenting that negotiations are pending the outcome of this appeal. Further litigation might prove necessary.

Some practical points that arise:

  • A buyer from a local authority will want to ensure that the land being acquired is not subject to public rights which prevent its intended use. This will include raising appropriate pre-contract enquiries on past land uses and the statutory powers used by the local authority for the initial acquisition and any appropriation to a different use. Local knowledge may be useful in raising specific enquiries and investigating issues that are revealed. These enquiries will be largely dependent on the records kept and disclosed by the selling local authority and it is to be noted that in this case the land was transferred between local authorities in 2010 but perhaps the historical records were not. A reliable answer may take some effort and time to obtain which may be in short supply in the face of a client eager to purchase the land. Lady Rose ended her judgment with an exhortation to local authorities to update their records on how they hold land and some authorities will no doubt heed this better than others.
  • What is the position of a hypothetical third party buyer from CSE: in other words what if CSE wanted to sub-sell the land in question? A local authority owner such as Shropshire can follow the procedure in s123[2A] but this route does not appear to be open to any seller other than a relevant local authority and so presumably CSE cannot sell free from the trust. What if a public trust is found to exist after multiple sales have occurred? Further litigation may be needed on these questions.
  • If there is any evidence that a selling local authority has at some time in the past held the land for open space in some manner, a purchaser should insist that the procedure in section 123[2A] is followed. This may delay a sale somewhat and may provoke objections to the sale which would need to be dealt with. However, if properly followed the procedure will ensure that the land can be purchased free of public statutory trust.
  • If in any doubt, a buyer purchasing the land should do so conditionally on relevant matters. In this case, a purchase contract that was conditional on planning (with the usual provisions extending the unconditional date if there is a planning inquiry or appeal) would likely have served to protect CSE as the sale completion would have to await the resolution of these challenges, subject to any longstop dates. CSE might have been disappointed with being unable to purchase the land but that would presumably be a better and cheaper outcome than having purchased land unable to be developed. A put option whereby a developer can require the local authority to buy back the land could also be considered as part of the deal.
  • The availability of title indemnity insurance should also be considered. This will be subject to the underwriter’s requirements and conditions, assuming it is available at all. Presumably cover will only be offered if planning has already been obtained without any relevant objections.

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