Background

This challenge concerned a written ministerial statement (“WMS”) dated 13 December 2023 entitled ‘Planning – Local Energy Efficiency Standards Update’.

In summary, the gist of the WMS was to (1) establish that the Government did not expect plan-makers to apply an uplift to local energy efficiency standards beyond building regulations and (2) introduce a presumption to reject at examination any local planning policies that did so without sufficient justification ensuring viability and the delivery of homes.

Rights: Community: Action Limited, the Appellant and unsuccessful claimant at first instance, alleged that the Respondent, in promulgating the WMS, failed to fulfil its duty under s.19(1) of the Environment Act 2021 (“EA 2021”).

s.19(1) EA 2021 requires that “A Minister of the Crown must, when making policy, have due regard to the policy statement on environmental principles currently in effect”.

The challenge was brought on the basis that the Respondent did not have due regard to the Policy Statement on Environmental Principles (“EPPS”).

As a matter of fact, at the time of promulgating the WMS in December 2023, the relevant Minister did not have express regard to the EPPS. However, (1) the predecessor Minister had been provided with an assessment of the draft WMS against the EPPS in October 2023 and had approved the draft for publication; and (2) an EPPS assessment was subsequently carried out following promulgation in February 2024.

To date, this remains the first and only case to consider s.19 EA 2021.

The Grounds of Appeal

The Appellant brought the appeal on two grounds. Only the first of the two grounds concern s.19.

Ground 1 alleged that the Judge, in finding that that the duty under s.19 was discharged, erred in her interpretation of s.19. The five sub-grounds at [63] fall along two distinct lines of argument:

First, the Appellant focused its submissions on the allegedly ‘rearguard’ assessment against the EPPS. It contended that this was impermissible in the circumstances.

Secondly, the Appellant argued that the Judge was wrong to hold that the s.19 duty was discharged by an EPPS assessment that (1) related to the draft Future Homes Standard (“FHS”), an inchoate policy not yet in force, and (2) failed to make sufficient inquiries as to the effects of the WMS on local planning authorities.

As noted above, Ground 2 did not concern s.19 at all. Rather, it alleged that the Judge erred in her interpretation of s.1 of the Planning and Energy Act 2008 in finding that s.1(1)(c) only permits a local planning authority to specify an energy efficiency standard exceeding building regulation requirements so long as it falls within the ambit of national policy. The Appellant argued that no such restriction existed.

The Court of Appeal’s Decision

Holgate LJ dismissed both grounds of appeal and gave the only reasoned judgment with which Lewis LJ and Dingemans LJ agreed.

Ground 1: On the Appellant’s primary argument as to the ‘rearguard’ nature of the assessment, Holgate LJ’s analysis centred on the expression “making policy” under s.19 EA 2021. Since s.47 EA 2021 defines “making policy” as including “developing, adopting or revising policy”, this meant that the duty applies across a number of stages in policymaking ([85]). Notwithstanding the fact that a breach has occurred at one stage, it is possible for there to be subsequent compliance in a later assessment. In deciding whether to quash or make any declaration of unlawfulness under such circumstances, “the court’s focus will be on whether that assessment is legally adequate in order to comply with the s.19 duty” ([87]-[88]).

Adopting the approach taken to the public sector equality duty in Secretary of State for Communities and Local Government v West Berkshire District Council [2016] EWCA Civ 441; [2016] 1 WLR 3923 at [87], “[t]he focus should be on the adequacy and good faith of the later Assessment, although the court is entitled to look at the overall circumstances in which that Assessment was carried out”.

Noting the highly fact-sensitive nature of the s.19 duty ([93]), Holgate LJ observed that the key issue informing the assessment required in this case was “the potential for achieving a greater reduction in carbon emissions if LPAs are able to set more onerous standards for new housing development” ([97]). It was relevant that the WMS was an interim measure ([97] and [103]). Against this, Holgate LJ concluded that the subsequent February 2024 assessment was adequate: it had worked through the relevant principles in the EPPS (in particular the integration principle and prevention principle) and had considered the marginal environmental benefits of higher local standards, as well as the potential adverse effects of those higher standards on housing delivery ([109]-[110]). There was also no indication of bad faith ([89]).

Further, the essential reasoning in the later assessment was present in the earlier October 2023 assessment, and there was no material difference between the October 2023 draft and the published WMS ([90] and [111]). In light of this, Holgate LJ found the Appellant’s suggestion of a rearguard action “striving to defend an earlier decision in the context of adversarial litigation” to be “wholly without foundation”. Nor did he accept that a fair-minded and informed member of the public would consider the later assessment to be “improperly tainted by the respondent’s concern about a judicial review challenge” ([112]).

In those circumstances, the failure to comply with the s.19 duty when the WMS was approved and published in December 2023 did not justify the grant of any relief ([111]).

Turning to the Appellant’s second line of argument under Ground 1, Holgate LJ agreed with the Judge that no error of law arose from the fact that the EPPS took into account the inchoate FHS policy. In circumstances where the WMS was confirmed to be an interim policy intended to apply until the FHS is introduced, “it was appropriate, if not necessary, for the EPPS assessment to take the draft FHS into account” ([106]).

As for further lines of inquiry, Holgate LJ, citing R (Khatun) v Newham London Borough Council [2004] EWCA Civ 55; [2005] QB 37, emphasised this was firmly a matter of judgment for the decision-maker subject only to challenge on reasonableness grounds. The EPPS assessment did identify a potential for environmental benefits, but the Secretary of State’s view as to the marginal nature of the benefits was reasonable one and was informed by the assessment. Reasonableness did not require further inquiry into other matters ([105] and [113]).

Ground 2: Holgate LJ agreed with Judge’s findings both on the limiting effect of s.1(1)(c) of the Planning and Energy Act 2008 and the accordance of the WMS with the language, purpose, and operation of s.1. Section 1(1)(c) authorises a local planning authority to select a local energy efficiency standard that does not go beyond standards referred to in national policy; the WMS permits the selection of a local standard up to the level of the draft FHS. The latter does not, by doing so, cut across the former so as to empty it of content and meaning ([68] and [73]).

Notably, Holgate LJ arrived at this conclusion simply by considering the legislative wording ([67]-[68]). Disagreeing with both the Judge and the parties’ agreement before the High Court, he did not consider the provisions ambiguous or obscure. The threshold in Pepper v Hart [1993] AC 593; [1992] 3 WLR 1032 was not met and Hansard was not properly admissible ([69]-[71]).

Comment

This first appellate authority to consider s.19 EA 2021 offers a number of key takeaways:

First, the passages at [93]-[94] offer a succinct description of the content and boundaries of the s.19 duty. They confirm (1) the focus on process, not outcome, (2) the role of evaluative judgment, and (3) the relevance of proportionality.

Secondly, the reasoning at [85]-[88] provides helpful elaboration on the correct approach as to breach and remedy, both expanding on and clarifying the reasoning at [44] of the first instance judgment. Holgate LJ confirmed that there was no doubt as to a breach of s.19 when the WMS was adopted initially. Further, the effect of a subsequent assessment is not to remedy the earlier breach, nor does it retrospectively validate the earlier adoption. In other words, the original breach subsists.

It is worth pausing on Holgate LJ’s analysis in light of the intervening submissions made by the Office for Environmental Protection (“OEP”). The OEP in its written submissions argued against the possibility of retrospective application, emphasising that the continuing nature of the s.19 duty requires due regard to be had at each stage of policy-making. It also submitted that the legislative intent of s.19 contemplates a “forward-thinking” application of environmental principles and the need for “early and iterative due regard” ([29] and [33] of the OEP’s submissions). All this meant that a failure at an early stage, e.g. before a policy is formulated and adopted, should result in unlawfulness. Any subsequent compliance with s.19 can go to remedy, but does not affect the unlawfulness of the decision itself ([49] of the OEP’s submissions).

Holgate LJ did not agree with this analysis. He derived limited assistance from the OEP’s references to legislative background, the EPPS, and analogies drawn with the public sector equality duty (“PSED”) under s.149 of the Equality Act 2010 (see below). It is clear that on his view, no primacy is given to the timing of compliance of s.19. A determination of lawfulness will require the Court to look at the whole decision-making process. Indeed, he compared the present situation to one where a Court had made a declaration of unlawfulness after the initial breach of s.19 (prior to any subsequent compliance). In these circumstances it remained open for the Secretary of State to lawfully have due regard to the EPPS and consider afresh whether to approve the policy. It follows from this that whilst retrospective consideration cannot cure an earlier breach, it can nonetheless result in a lawful decision.

As noted by the OEP, the significance of subsequent compliance with the s.19 duty goes to the question of whether the Court should grant a remedy. This is, of course, a reminder of the discretionary nature of judicial review remedies. It also bears remembering that the role of the Court is not “that of a disciplinarian, punishing for the sake of it” (West Berkshire at [87]).

Thirdly and related to the legal effect of breach, Holgate LJ did not expressly refer to the approach set out in R v Soneji [2005] UKHL 49; [2006] 1 AC 340 and Al Properties Ltd v Tudor Studios RTM Co Ltd [2024] UKSC 27; [2024] 3 WLR 601, which involves considering (1) the purpose served by a statutory requirement and (2) whether the legislative intent requires non-compliance to result in the invalidity of a decision. However, it seems that application of these principles above would most likely lead to the same result: s.19 serves to inform the process of policy-making, not to deliver a particular outcome. Failure to have due regard at one stage (when there are multiple stages) is unlikely to render a decision unlawful.

Fourthly, as to the cross-applicability of the PSED, and any case law on that duty, Holgate LJ (unlike Lieven J at [42]-[43] of the first instance decision) expressly declined to express a view, stating that such issues went beyond what was necessary for the Court to decide. He did, however, single out the statement of Lord Neuberger in Hotak v London Borough of Southwark [2015] UKSC 30; [2016] AC 811 (at [74]) to emphasise that “the weight and extent of the duty are highly fact-sensitive and dependent on the individual judgment”.

Fifthly, in terms of the Courts’ overall approach towards the intensity of scrutiny, the tenor of this decision is consistent with that of the first instance judgment. Notwithstanding the environmental context of this case, there is no indication that the Courts are prepared to adopt a higher intensity of review. A proportionate and moderate approach affording broad discretion to the decision-maker remains applicable ([105] and [113]). This no doubt reflects the multifaceted and complex nature of the environmental issues in the EPPS.

Separately, and unrelated to the s.19 duty, Holgate LJ observed that there appeared to be no satisfactory answer to the source of the power which permitted a local planning authority to specify a policy standard more onerous than national policy. It was posited that this was a lacuna in the legislation. Ultimately, it was unnecessary for the resolution of Ground 2 for this point to be determined ([78]-[80]). That said, it is quite possible that this fundamental tension between the Planning and Energy Act 2008 and the Planning and Compulsory Act 2004 will be a point tested in future litigation.

Jeffrey Chu is a pupil barrister at Francis Taylor Building.

Ned Westaway appeared for the Secretary of State in this case. He has not had any involvement in the drafting of this post.