The holding, use and development of land by parish councils

LEGAL MATTERS

Introduction
The purpose of this article is to acquaint parish councils with the holding, use and development of land; it forms part two of a series of three articles dealing with the acquisition, holding and disposal of land by parish councils (part one, “The acquisition of land by parish councils”, was published in the July 2022 issue of Clerks & Councils Direct). In making decisions to deal with its land, a parish council must consider and comply with the following principles of administrative law.

Administrative law framework: proper and valid decision-making
1) Valid exercise of functions

The valid exercise of a function must:

fall within the statutory envelope (functions);
be properly made by someone authorised to make the decision (authority);
follow the rules on proper decision-making.

2) Functions: duties and powers

A local authority is a creature of statute and can only do what statute expressly allows or implies. Functions are duties (obligatory requirements – “must” or “shall”) and powers (permissive – “may”).
The scope of a council’s powers will be materially affected by its ability to exercise Section 1 of the Localism Act 2011 (eligible councils only).

3) Authority

There must be authority for the transaction.
Decision-making can be through full council.
Decisions can be delegated to a committee or by a committee to a sub-committee or to an officer, but not to an individual member.

4) A valid decision must:

be reached in a procedurally correct way: specific steps and requirements, decision-making in public or in confidential session, and
itself be reasonable.

5) “Reasonable” means a decision which:

must take account of proper considerations;
must leave out of account irrelevant considerations;
must be made for a proper purpose;
must be proportionate as to the purpose to be achieved and the expenditure involved;
must have regard to the council’s fiduciary duty to its taxpayers;
must be fair – avoiding bias or the appearance of bias and taking account of opposing views.

6) A decision-maker must have regard to certain specific statutory duties: reduction of crime and disorder, public sector equality duty and consideration of specific issues regarding consultations and legitimate expectation.

7) Decisions should be properly documented and justified by reasons in reports and background papers and recorded in minutes or records of delegated decisions.

8) The exercise of powers will be subject to the general law e.g. as to the obtaining of planning permission or the obtaining of consents from other bodies e.g. the Secretary of State, the Charity Commission.

What do we mean by land?
The Local Government Act (LGA) 1972 s 270 defines land as including “any interest in land and any easement or right in, to or over land”. Land also includes buildings and structures attached to the land, but not caravans or portacabins which rest on the land. A licence, which is a contractual right to use land, is not an interest in land. For certain purposes, e.g. under the Town and Country Planning (General Permitted Development) Order 2015 (as amended), buildings can be treated separately from the land on which they stand, but this does not affect land law.

Acquiring, holding, using, appropriation and disposal of land
1) A local authority may only acquire, hold, use, develop or dispose of land within the statutory framework. Even if the transfer or conveyance by which the land was acquired does not specify the powers under which the land is acquired or is to be held, the land will be deemed to have been acquired or held for a statutory purpose.

2) The purposes for which land is acquired or held are crucial to the purposes for which it can be used or developed or the freedom with which it can be disposed of.

3) The statutory powers should be specified in any transfer upon acquisition e.g. pursuant to s 124 of the LGA 1972 or pursuant to s 9 of the Open Spaces Act 1906.

4) If land is not capable of use for the statutory purposes for which it was acquired, then it may be appropriated to other statutory purposes.

5) A local authority may accept, hold and administer gifts of land for any of its functions, under s 139 of the LGA 1972.

Holding, use of and development of land
1) Land, once acquired, must be held for a statutory purpose. This will be for the purpose for which it has been acquired generally, e.g. under the LGA 1972, or specifically, e.g. under the Open Spaces Act 1906, unless it has been formally appropriated for another purpose.

2) The use of land and any restrictions on its use will depend on the statute governing the statutory purpose. Land may only be used for the purposes for which the powers are given. S 111 of the LGA 1972 may be relevant.

3) For example, land held under the Public Health Act 1875 (public walks and pleasure grounds) is held under public open space trusts and the public uses the land by right. Accordingly, it can only be closed or access curtailed or restricted under the terms of the Public Health Acts 1875–1961. It follows that land held under the public open space trusts imposed under the Public Health Act 1875 and the Open Spaces Act 1906 cannot be used for allotments (see s 10 of the Open Spaces Act 1906, but also see the note regarding appropriation) and cannot be designated as a village green. Land held for the purposes of the Allotments Acts may only be let on certain terms and possession can only be obtained in certain circumstances, and compensation may be payable. It is a presupposition that not more than 5% of recreation land held under the Open Spaces Act 1906 will be built on.

4) The use and development of land may be subject to public law constraints of a specific or general nature and private law restrictions. Public law designations include a village green or common land, SSSIs and other nature and biodiversity designations. Public laws rights include public rights of way e.g. public footpaths. Private law restrictions include covenants and easements and wayleaves and licences.

5) Land designated as a village green may not be used or developed other than for public recreation. It is a criminal offence to carry out works which disrupt the land surface, and development other than incidental to public recreation is prohibited.

6) Registered common land is owned by a person, often by local authorities (not held in common), and is subject to the rights of commoners (if any) and the public right to wander on foot (access land). Development on a common is severely restricted and may need the consent of Defra (see s 38 of the Commons Act 2006).

7) Land held also for charitable purposes, i.e. under charitable trusts, must be used and developed only in the interests of the beneficiaries and for the charitable purposes specified. Charitable objects may not necessarily be the same as the interests of the local authority or a local authority’s perception of the public interest.

8) Regulation of land held under the Public Health Act 1875 and the Open Spaces Act 1906 can be effected by byelaws specifically made under those Acts. Land held under the Road Traffic Regulation Act 1984 (off-street car parks) may be regulated by order made under that Act (including the power to charge and to levy penalty charges). There may be a local Act of Parliament regulating activities. A parish council may enter into management agreements for the regulation of land of which it has taken control even if it has not acquired an interest: see, for example, s 10 of the Open Spaces Act 1906.

9) There are compulsory powers of control and maintenance of closed churchyards: see s 215 of the LGA 1972.

10) It is prudent to register at the Land Registry unregistered land in order to protect it from encroachment and to facilitate the compiling of the asset register and to comply with the Transparency Code.

Covenants
1) Freehold land may be subject to covenants. Covenants are private law contractual obligations which can be enforced between the original parties, being the covenantor (the person subject to the obligation) and the covenantee (the person having the benefit of the obligation). A local authority which has acquired the land following a statutory transfer, e.g. under a reorganisation order, is treated as if it was the original party.

2) Covenants affecting freehold land can be of two types: positive (“you must”) and restrictive (“you shall not”). An example of a positive covenant is an obligation to erect and maintain fences. An example of a restrictive covenant is not to use the land other than as open space.

3) In general, positive covenants do not run with freehold land, i.e. they are not enforceable by successors in title of the original parties.

4) Restrictive covenants may run with the land, i.e. be enforceable by the successor in title of the original parties, provided certain criteria are met. The following are points to note:

Words in a conveyance or transfer whereby covenants purporting to be made for or on behalf of successors in title have no operative effect in terms of making covenants run with the land, unless the other rules set out below apply.
Failure to register a restrictive covenant will render the covenant unenforceable, although registration does not make covenants run with the land unless the other rules set out below apply.
A restrictive covenant can only be enforced by a successor in title of the covenantee against the original covenantor or successor in title of the covenantor if the successor in title of the covenantee has land which is or is capable of being benefited.
The issue of fragmented dominant land (see below).
A restrictive covenant must exist to protect land.
The land benefited has to be easily identifiable within the deed.
Where the covenantee owns no land or no identifiable land, the restrictive covenant cannot be enforced against the covenantor’s successor in title unless there is a specific collateral obligation between the successor in title and the covenantee (i.e. preserving a direct contractual relationship), for example a deed of covenant.
Where the covenantee’s successor in title owns no land or no identifiable land, the restrictive covenant cannot be enforced against the covenantor’s successor in title unless there is a specific collateral obligation between the successor in title and the covenantee (i.e. preserving a direct contractual relationship), for example a deed of covenant.
Certain statutes, e.g. s 106 of the Town and Country Planning Act 1990 (as amended) or s 33 of the Local Government (Miscellaneous Provisions) Act 1982, allow for covenants to be enforceable by certain authorities irrespective of retained land. The particular power must be specified in the instrument, e.g. a deed. Parish councils cannot apply these provisions.

5) Leases will also contain covenants both positive and negative. They are always enforceable as between the landlord for the time being and the tenant for the time being even if there is no direct contractual relationship between them. Note the use of very long leases as a mechanism for enforcing covenants.

6) Covenants cannot be enforced by persons outside the consideration, e.g. members of the public.

Easements and licences
1) Easements are private law property rights over land (the servient land) in favour of neighbouring land (the dominant land). They attach to land and not to people. An example is to pass and repass over land to enable the owner of adjoining land to access the highway. Easements are enforceable as between the landowners for the time being. Wayleaves are similar to easements but typically enure to the benefit of utilities, e.g. to run a pipeline or electricity cables across land, and may not therefore benefit dominant land as such.

2) Licences do not constitute an interest in land. They are contractual rights to use land and are personal to the licensee. Licences do not run with the land. It is important that a licence does confer exclusive possession, as this may constitute a lease.

The development of land
The development of land by a local authority must follow the usual rules concerning planning permission and other statutory permissions and consents e.g. licensing. Planning permission is required for development: the making of material change of use of land or the carrying out of operational development. Certain activities are not regarded as development: e.g. the use of land for agriculture or certain changes of use within use classes. The Town and Country Planning (General Permitted Development) Order 2015 permits in certain circumstances development without the need for express planning permission (see in particular Schedule 2, Part 12), as do local and neighbourhood planning orders.

Appropriation
1) Appropriation is the transfer from one statutory purpose to another.

2) There cannot be any implied or informal appropriation of land.

3) The LGA 1972 provides:

126 Appropriation of land by parish … councils

(1) Any land belonging to a parish … council which is not required for the purposes for which it was acquired or has since been appropriated may, subject to the following provisions of this section, be appropriated by the council for any other purpose for which the council are authorised by this or any other public general Act to acquire land by agreement.

4) Appropriation of open space land is treated as if it were a disposal of the land in question and the statutory advertisement procedure is engaged: s 127 of the LGA 1972. Appropriation of a common, village green or public open space to land for statutory allotments cannot proceed without an order by the Secretary of State: s 28 of the Land Settlement (Facilities) Act 1919.

Practical points to note – general
When approaching property transactions generally and in deciding what to do with the council’s land, you should bear in mind the following general points.

Carry out a full appraisal of the proposals for the use of the land.
Establish whether the necessary statutory powers are available.
Take professional and legal advice.
Ensure that decision-making is appropriate and documented and that appropriate authorities are in place. Note the importance of delegated authority.
There should be a project plan, including a timetable, in place and a person should be appointed to lead.
The clerk should be properly equipped and authorised to act as the single point of contact with solicitors, etc.
An adequate budget should be approved to cover considerations, professional fees, etc.
Be alive to the VAT implications.
Ensure proper reporting mechanisms.
Do not underestimate costs or timescales, especially if there are pushy solicitors, prospective tenants playing games or unrepresented landlords or tenants involved.
In managing the process, note the difference between agreeing terms and handling the legal process.

Ian Davison has worked in and for local government for over 40 years. He is a partner in Surrey Hills Solicitors LLP. Before joining private practice, he was a chief officer providing and managing a wide range of services including legal, democratic, scrutiny, member support, licensing and project management and he has acted as monitoring officer and electoral returning officer. He was also a clerk to a parish council. Ian is legal advisor to the Kent, West Sussex and Hampshire Associations of Local Councils and SERCAF. He is also a contributor to the local government, open spaces, recreational leases and highways titles of the leading professional practitioner work The Encyclopaedia of Forms and Precedents. For more information, see www.surreyhillssolicitors.co.uk.

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Written Ian Davison, partner, Surrey Hills Solicitors LLP
As appeared in Clerks & Councils Direct, January 2023
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