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Cite as: [2000] EWHC Admin 330

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MACGAY LIMITED v. SECRETARY OF STATE FOR ENVIRONMENT, TRANSPORT AND REGIONS v.; HARROGATE BOROUGH COUNCIL v.; HEATHER I'VE ASSOCIATES v.; JJ HARRISON (PROPERTIES) LIMITED v. and SWAYFIELDS LIMITED [2000] EWHC Admin 330 (14th April, 2000)


Case No CO/1562/99
IN THE HIGH COURT OF JUSTICE QUEEN S BENCH DIVISION
CROWN OFFICE LIST
At Liverpool
Friday 14 April 2000

Before:
THE HON. MR JUSTICE ELIAS

Between:
MACGAY LIMITED

(Applicant)
-and-

(1) THE SECRETARY OF STATE
FOR THE ENVIRONMENT,
TRANSPORT AND THE REGIONS
-and-

(2) HARROGATE BOROUGH COUNCIL
-and-
(3) HEATHER I'VE ASSOCIATES
-and-
(4) JJ HARRISON (PROPERTIES) LIMITED
-and-
(5) SWAYFIELDS LIMITED
(Respondents)
__________________________________
(Transcript of the Handed Down Judgment of
Smith Bernal Reporting Limited, 180 Fleet Street
London EC4A 2HD
Tel No: 0171 421 4040, Fax No: 0171 831 8838
Official Shorthand Writers to the Court)
__________________________________


Mr Robert Fookes appeared on behalf of the Applicant
Mr Tim Mould appeared on behalf of the 1st Respondent
Mr Gregory Stone Q.C. appeared on behalf of the 2nd Respondent
Mr Robin Purches Q.C. appeared on behalf of the 3rd Respondent
__________________________________
Judgment
As Approved by the Court
Crown Copyright ©



Macgay v Secretary of State.

In 1992 the then Government adopted a policy to upgrade the A1 Trunk Road to motorway standard. One consequence of this was that it was necessary to consider whether to develop motorway service areas (MSAs) to serve the motorway once the road was upgraded. One of the proposed MSAs is in the Harrogate district on a site north of Ferrybridge. The local planning authority there is the Harrogate Borough Council. A number of applications for planning permission in respect of an outline application were made to the Council. They related to four different areas. The Applicant Macgay sought permission in respect of a site within the north east quadrant of the proposed Kirk Deighton interchange of the A1(M) motorway, on the outskirts of Wetherby. The Third Respondent, whom I shall call "Heather Ive" made an application in respect of a site at Kirby Hill; the Fourth Respondent ("Harrison") in respect of a site at Arkendale; and the Fifth Respondent ("Swayfields") in respect of a site at Allerton. The Council favoured the site at Allerton and, against the advice of its planning officer, who favoured Kirk Deighton, it selected Allerton for allocation in the deposit version of the local plan, whilst also resolving to give it outline planning permission. That application was called in by the Secretary of State. Macgay was refused planning permission by the Council in February 1995, and it appealed to the Secretary of State. In respect of the other two applications, no decision had been made within the specified time and accordingly they also appealed to the Secretary of State. The result was that the Secretary of State had to determine four applications. He appointed an inspector to carry out a public inquiry, and subsequently confirmed the recommendation of the Inspector by a letter dated 15 March 1999. This was that conditional planning consent should be given to Heather Ive in relation to the site at Kirby Hill.
Two of the applicants were dissatisfied with this decision, as was the Council. They all made applications pursuant to section 288 of the Town and Country Planning Act 1990 to quash the Secretary of State's decision. One of the applicants, Harrisons, withdrew its application shortly before the hearing, but the other two parties maintained their challenges. Before the Inspector, the Council had run arguments supporting the Allerton case, but it was no longer pursuing that line before me. Indeed, it was lending its weight in support of Macgay, although its submissions adopted a narrower focus.
Since in his decision the Secretary of State relied upon both the recommendation and the reasons of the Inspector, it is necessary to examine the Inspector's analysis in some detail in order to understand the nature of the legal challenge.
The Inspector's Report
This was a detailed and very carefully constructed report. The
Inspector compared the relative merits of the various sites which all parties accept he was obliged to do in accordance with the Court of Appeal decision in Secretary of State for the Environment v Edwards[1994]1 PLR62. He prefaced his conclusions by setting out what he considered to be the main considerations to all four proposals. In paragraph 14.1 he described these as follows:
"In my opinion, the main considerations common to all 4 of the proposals before the Inquiry in varying degrees are:
(a) the need for an MSA on the Wetherby-Dishforth section of the A1(M) and the extent to which each proposal would meet the need in terms including location, timing and convenience of access.
(b) having due regard to the Development Plan, the emerging Local Plan and Government planning policies, the degree of harm which each particular MSA proposal would cause in terms of:-
(i) encroachment in the countryside;
(ii) landscape and visual impact;
(iii) ecology;
(iv) agriculture;
(v) highways and traffic effects.
(c) in the case of each of the Inquiry proposals, whether or not there may be an alternative site available which would meet the need while causing less harm."
Broadly, therefore, he was concerned to determine whether there was a need and, if so, how that need should be met whilst causing the least harm to planning and environmental interests.
There was one particular feature of the Macgay application which, as we shall see, proved to be crucial to the outcome of the Inquiry. It was that their application was contingent on a stretch of the motorway actually being constructed; their site between Wetherby and Walshford was not on the current trunk road at all. The position with respect to the proposed extension was described by the Inspector as follows:
"The HAg's (Highways Agency's) letter dated 8 October 1997 (HBC30) states that Orders for the Walshford-Wetherby scheme have been fully made (albeit on hold pending the outcome of the review) with Notices to Enter intended to be served in October 1997. Nevertheless in their letter dated 2 October (CD12) the HAg's say "there is no certainty over whether a scheme will go ahead and in what form". In a further letter dated 20 October 1997 (CD10) The HAg say "Assuming the scheme is given the go ahead in the review, that funding is made available and design work recommences in June 1998, the earliest start of works date is 2001 with the road open in the financial year 2003/4".
I now turn to consider the approach of the Inspector to the two issues that he posed to himself, namely establishing the need, and meeting the need.
Establishing the need.
The Inspector observed that in an earlier inquiry in 1994 an inspector had concluded that the need for an MSA was "beyond dispute". In that context the Inspector considered afresh whether there was a need, analysing that issue by having regard to the changes since the 1994 inquiry, the services provided by existing roadside services, and the proximity to other substantial services located on the trunk road (which he termed the "spacing" issue). He noted that the parties' views on the significance to be given to the existing services varied considerably. Some thought that they should be discounted entirely when assessing need, although both applicants felt that weight should be given to those services, concluding as a consequence that the need was "qualitative" rather than "quantitative". By this they meant that the need was for better quality services but not because there were insufficient places to stop. The significance of this, so far as Macgay was concerned, was that it meant that the need "carries with it no urgency" (para. 8.25). The Inspector's conclusions on the impact of the existing services to the question of need were as follows:
"......The composite A1(M)/A1(T) is clearly a high status road of national strategic importance and I fully endorse the views expressed in the Council's evidence (9.29) and by HIA (9.32) that the needs of its users for modern, comprehensive, round-the-clock facilities are the same on both the trunk road and motorway sections. Accordingly I find little comfort in Macgay's unchallenged point that the existing facilities to the north of Dishforth, when aggregated, provide parking for cars well in excess of RC1/94 requirements. It cannot be right, as we approach the 21st century, for users of the composite A1 route to have to rely "for the foreseeable future" on fragmented partial service with questionable access arrangements.
In the light of the foregoing observations I conclude that the existing partial services should be excluded from the gapping matrices in assessing the need for an MSA on spacing grounds, and that it would be unreasonable to reject any of the proposed MSAs at this Inquiry solely on the grounds of proximity to existing partial services."
In my judgment the Inspector does not here reach any specific conclusion about the extent to which the need is quantitative or qualitative; and it was not strictly necessary for him to do so. He does, however, seem to be accepting that it is at least in part qualitative, but that this is not a justification for doing nothing "for the foreseeable future".
Overall, the Inspector concluded that "on balance...the need for MSA provision remains compelling".
Meeting the need
When considering the question how the need should be met, the Inspector analysed the issue under four headings which he identified as locational considerations; the internal layout of each scheme; whether the proposed schemes were "on-line" or "off-line" i.e. how far they were from the trunk road itself; and timing. In addition to these factors he then considered the potential harm which each site would cause to planning and environmental considerations.
The Inspector's conclusions on the timing issue are critical in this case. Having expressed the opinion, contrary to the submissions of Macgay, that all the parties save for Macgay would, if granted planning permission, be able to take it up without undue delay, he commented on Macgay's position as follows:
"However, the situation with regard to Kirk Deighton, well documented in the Cases for Macgay's competitors and the Council is totally different. The HAg's draft programme showing an earliest opening date of October 2003 for Kirk Deighton MSA, could only be achieved if all the following requirements were to be met;
(a) approval of the Wetherby-Walshford upgrading scheme in the current Roads Review
(b) the design of the scheme, including the proposed Kirk Deighton
interchange, remaining in its present form;
(b) detailed design work starting in Summer 1998;
(c) no delay in funding for the scheme.
Even if all 4 of above requirements were to be met, Kirk Deighton MSA would not be available to the travelling public until at least 3 to 4 years later than any of the other proposals in this Inquiry and completion of the M1-A1 Link. This is a substantial length of time to expect users of the composite A1(M)/A1 to continue relying on the fragmented partial services which characterise the route. In any case, this is clearly a hypothetical and optimistic scenario which I examine further below.
It is likely that the outcome of (a) will be known prior to the Secretary of State's decision in this Inquiry. If that outcome is that the Wetherby-Walshford scheme is deferred or dropped from the National Roads Programme, the Macgay's application would have to be refused for that reason alone. If the scheme is approved, then possibly it may also be known that requirements (b) and (c) are on course to be fulfilled. However, with regard to (d), it would be folly for me to speculate now on the outcome of a Treasury Spending Review in, say the year 2000, prior to invitations to tender. In view of this uncertainty, it seems to me that the Kirk Leighton appeal must be dismissed.
In summary, I conclude that the question of timing is essentially neutral between Allerton, Arkendale and Kirby Hill and see no reason why any should not be advanced reasonably quickly in accordance with the advice in PPG13 (9.44). However, given the uncertainty as to whether and when Kirk Deighton MSA would be built, Macgay's appeal should be dismissed".
The significance of this conclusion is made plain when one examines the overall recommendation of the Inspector. In what he terms his "summary of key conclusions" he succinctly summed up his conclusions on timing as follows:
"I see no material distinction between Allerton, Arkendale or Kirby Hill with regard to the potential for reasonably prompt implementation of any planning permission (14.39). However, because of the uncertainty as to whether, when and in what form the Wetherby-Walshford section of the A1 upgrading will take place (14.36, 14.39), I conclude that the Kirk Deighton appeal should be dismissed."
In the following paragraph he set out his overall conclusion on "meeting the need" in the following terms:
"On balance I conclude that Arkendale, Kirby Hill and Allerton (in that order of preference) would all meet the need to a material degree. Kirk Deighton would be second only to Arkendale in meeting the need in terms of location, internal layout and convenience of access, but must fail in absolute terms on the question of whether and when it would be available (14.137)".
This was the decisive blow for Macgay. Apart from this consideration, the Inspector concluded that Kirk Deighton was the best site. He considered it to be preferential to Kirby Hill in landscape terms, in agricultural terms and in terms of meeting the need, and to be only slightly less favourable in highway and traffic terms. In his "Overall conclusions" he said this:
"Kirk Deighton must fail on the fundamental problem of whether and when it could be made available. Otherwise, and subject to the caveat concerning the Wetherby Bypass (14.142), I consider on overall balance that it would be the most preferable site".
(By the time the report was considered by the Secretary of State, the particular caveat referred to was no longer an issue.)
The reasons for recommending Kirby Hill were explained as follows:
"Kirby Hill would meet the need to a material degree, and its effect on the landscape and visual amenity, though greater than that of Allerton or Kirk Deighton, would not be so serious as to outweigh the compelling need for a new MSA on this section of the A1/A1(M)".
The Secretary of State's decision
The Inspector held his inquiry on certain dates between 7 October 1997 and the 23 January 1998. The Secretary of State's decision was given some 14 months later on the 15 March 1999. In the interim, there were certain developments which the Secretary of State referred to in his decision letter. I shall first set out the material passages in that letter and then look at the fresh material to which he refers.
The decision letter
The Secretary of State annexed a copy of the Inspector's report, and his conclusions, to the decision letter. The key paragraphs of the letter were the following:
"3 The Secretary of State agrees with the Inspector's conclusions and accepts his recommendations. He has taken into account the announcement made by the Minister for Roads, Lord Whitty, on 31 July 1998 about future arrangements for motorway service areas. He has also taken into account the results of the trunk roads review set out in "A New Deal for Trunk Roads in England" published in the same month, and of the subsequent announcement of start dates for schemes included in the programme. However, in his view these do not raise any issues which would cause him to depart from his decision.
4. The Secretary of State has received two items of post-inquiry correspondence from the Hepher Dixon Partenership who act on behalf of Macgay Limited. The first refers to the results of the roads review and the new policy statement on arrangements for motorway service areas. The second relates to the inclusion of the Bramham Cross motorway service area site as a pre-inquiry change to the Deposit Draft of the Selby District Local Plan. These representations have been considered but have not affected the Secretary of State's decision.
.....................
6. Therefore, for the reasons given by the Inspector, the Secretary of State hereby refuses to grant outline planning permission for an MSA on land situated at the south-east quadrant of the A1(M)/A59 interchange at Allerton and dismisses the appeals by JJ Harrison (Properties) Limited and Macgay Limited. He allows the appeal by Heather Ive Associates and hereby grants outline planning permission for a twin-sided motorway service area on land to the east and west of the A1(M), just north of the B6265 Ripon-Boroughbridge road near Kirby Hill, subject to the following conditions......."
Although the language in paragraphs 3 and 4 is different, each is apparently intended to say the same thing, namely that the Secretary of State has taken into account the new material but that it has not affected his decision.
The fresh issues
Paragraph 3 refers to three developments which are said, however, to raise "no issues" which would cause the Secretary of State to depart from his decision. The first is the announcement of the Minister of Roads made to Parliament on the 31st.of July 1998 relating to the review of the trunk roads programme. After referring to the fact that there had been extensive consultation, the Minister said this:
"For the first time ever we have provided financial stability through our three year spending programme and seven year transport investment plan which will enable our programme to go ahead. And for the first time ever we have a practical and focused programme. Gone is our predecessor's massive wish list of 150 schemes, some of which would never have been built, over a timescale which was never specified and for which money was never assured.
We have looked at the schemes which could be started in the foreseeable future and produced a programme that is funded and delivers our objectives. This is the 37 schemes in our targeted programme of improvements, all of which can be started within seven years".
The second development was the document entitled "A new deal for trunk roads in England". This identified the 37 targeted schemes, which included the Wetherby-Walshford stretch of the A1. These schemes were at various stages: some were at a stage where draft orders had been published, in the case of others orders had been made, and some were at a more advanced state termed "start of works". The Wetherby-Walshford road fell into that last category.
The third development referred to was an answer given to a Parliamentary question by the Minister for the Environment Transport and Regions on the 10 December 1998. He confirmed that the 37 schemes would "definitely start within the next seven years, subject only to the completion of any outstanding statutory procedures". He also announced that the Wetherby-Walshford stretch was one of two schemes were the statutory procedures had been completed, and one of five schemes that were being made subject to a Design, Build, Finance and Operate contract ("DBFO"). It had a contract award date of 2002/03. An advantage of this type of contract is that it is not necessary for the whole capital payment to be made up front: rather it is made over a thirty year period. However, the contract will be awarded only if the Highways Agency, which is responsible for entering into the contracts, and the Minister are satisfied that the DBFO contract provides value for money when compared with conventional procurement arrangements.
In paragraph 4 of the decision letter the Secretary of State referred to two items of correspondence from the Hepher-Dixon partnership, planning consultants who act on behalf of Macgay. The first of these was a letter written on the 13 November 1998, after the Inspector's report had been received by the Secretary of State in September of that year. Essentially it drew attention to two of the developments which I have already mentioned but not the December announcement, which it predated. The letter urged the Secretary of State to take these developments into account. It concluded:
"For the most part, these [developments] affect interpretation of evidence given at the multiple inquiry, rather than occasioning the need for new evidence".
The other letter dated 19 January 1999 drew attention to the fact that a motorway service area site at Bramham Cross had been included as a change to the Selby District Local Plan. It was written on behalf of Granada Hospitality Limited which owned and operated an MSA at Selby Fork and had objected to the change in the local plan. They were also Macgay's proposed operator in the event of the planning application for Kirk Deighton proving to be successful. The letter concluded:
"I am writing to bring the matter to your attention since it may be an issue upon which the Regional Office will also wish to comment at that time"
It is material to point out, however, that in drawing attention to this matter, the partnership made no reference at all to the planning appeal, although Bramham had been considered by the Inspector in assessing need.
The grounds of challenge.
The statutory appeals are made pursuant to section 288 of the Town and Country Planning Act 1990. Subsection (1) provides, is so far as it is material, as follows:
"If any person-
(a) is aggrieved by any action on the part of the Secretary of state to which this section applies and desires to question the validity of that action, on the grounds that the action is not within the powers of this Act, or that any of the relevant requirements have not been complied with in relation to that action, he may, within six weeks from the date on which the order is confirmed or the action is taken, as the case may be, make an application to the High Court under this section."
Where the allegation is that relevant requirements have not been complied with, it is necessary for the applicant to show that he has been substantially prejudiced by that failure. This is plain from subsection (4):
"On any application under this section the High Court-....
(b) if satisfied that the ...action in question is not within the powers of this Act, or that the interests of the applicant have been substantially prejudiced by a failure to comply with any of the relevant requirements in relation thereto, may quash that...action."
The principal ground of Macgay's appeal, which is the only ground relied on by the Council, is that the reasons given by the Secretary of State are wholly inadequate. They contend that he has failed to provide proper reasons for his decision as he is required to do by regulation 17 of the Town and Country Planning (Inquiries Procedure) Rules 1992, and that they have been substantially prejudiced by this failure. The applicants say that in view of the developments which I have mentioned, the reasons which the Inspector gave for not recommending the Kirk Deighton site were no longer applicable. The Inspector had pointed to fundamental uncertainties which were no longer present by the time the Secretary of State came to determine the matter. To the extent that there were any remaining doubts about whether and when the motorway construction would take place, they were fundamentally different in kind to the doubts and uncertainties that presented themselves to the Inspector. Accordingly, it is said, the Secretary of State could not conceivably be reaching his decision for the same reasons as the Inspector, and by saying that he had done so, he must have erred in law. At the very least, he has left wholly obscure the basis of his reasoning.
The other grounds advanced by Macgay go to the substance of the decision itself. It is alleged that the Secretary of State erred in law in various ways and therefore reached a decision which was not within the powers of the Act. The errors relied upon are as follows:
(1) The Secretary of State failed to take into account the fresh developments.
(2) If and insofar as the Secretary of State had regard to any need for the MSA to be developed as a matter of urgency, he erred in law since there was no finding of the Inspector that the need was so urgent as to override normal planning considerations.
(3) The Secretary of State failed to have regard to the fact that a local plan inquiry was pending; he ought to have delayed his decision until a report had been issued by the local plan inspector. The inquiry into objections had already been heard in July 1998 (although in fact no report was issued until January 2000.)
(4) The Secretary of State had failed to have regard to the consequences of different sites upon future applications within the Green Belt. The thrust of this argument was that the selection of Kirby Hill would increase the need for a further MSA to the south, within the Green Belt. A related argument was that the Secretary of State should in any event have given reasons for continuing to select Kirby Hill in the light of the fact that by then Bramham was identified in the Selby Local District Plan.
(5) The Secretary of State had acted irrationally in concluding that the site at Kirby Hill would be acceptable in landscape terms. In reaching this conclusion he had acted on two misunderstandings of a landscape appraisal report prepared by Woolerton Truscott.
If any of these grounds succeeds then the decision must be quashed without Macgay having to establish substantial prejudice.
I shall first address the ground which relates to the alleged failure properly to comply with the requirements of the Act by giving inadequate reasons, and then consider the substantive grounds of the challenge, which raise the question whether the decision was within the powers of the Act.
Defective Reasons: the Law.
The principal issue in this case raises the question of how the Secretary of State should approach planning appeals and, more specifically, the extent to which he is required to explain his reasoning in the decision letter. In the past decade these questions have on three occasions been considered by the House of Lords. The relevant cases are Save Britain's Heritage v Number 1 Poultry Ltd.[1991]1W.L.R.153; Bolton Metropolitan District Council v Secretary of State for the Environment(1996)71P.&C.R.309; and City of Edinburgh Council v Secretary of State for Scotland[1997]1W.L.R.1447
In the Bolton case Lord Lloyd summarised the position as follows (p.3113):
"Before dealing with each of these challenges, I should first make some preliminary observations on the correct approach to decision letters in planning appeals, with which alone we are concerned in this case. This can be done very briefly, since the question was fully covered in the recent speech of Lord Bridge of Harwich in Save Britain's Heritage v. No. 1 Poultry Ltd.
Under Section 70(2) of the Act of 1990, read with section 77(4), it was the duty of the Secretary of State to have regard "to the provisions of the developments plan...and to any other material considerations". Under rule 17(1) of the Town and Country Planning (Inquiries Procedure) Rules 1988 (S.I. 1988 No.944), it was the duty of the Secretary of State to "notify his decision...and his reasons for it in writing to all persons entitled to appear at the inquiry who did appear..." So the Secretary of State had to have regard to all material considerations before reaching a decision, and then state the reasons for his decision to grant or withhold planning consent. There is nothing in the statutory language which requires him, in stating his reasons, to deal specifically with every material consideration. Otherwise his task would never be done. The decision letter would be as long as the inspector's report. He has to have regard to every material consideration; but he need not mention them all".
Similar observations were made by Lord Clyde in the Edinburgh case (p.1464E to 1465C). In that case his Lordship quoted a brief passage from the judgment of the Lord President Emslie in Wordie Property Co. Ltd. v Secretary of State for Scotland, 1984 S.L.T.345,348 in which he had adopted the concept of the "informed reader". Lord Emslie said this:
"The decision must, in short, leave the informed reader and the court in no real and substantial doubt as to what the reasons for it were and what were the material considerations which were taken into account in reaching it."
In the Save case Lord Bridge had commented on the degree of particularity required and had also expanded on the circumstances in which a defect in the reasons might invalidate the decision on the grounds that substantial prejudice had been made out. He said this (p.166 to 167):
"The three criteria suggested in the dictum of Megaw J. in In re Poyser and Mills' [1964] 2Q.B. 467, 478 are that the reasons should be proper, intelligible and adequate. The application of the first two of these presents no problem. If the reasons given are improper they will reveal some flaw in the decision-making process which will be open to challenge on some grounds other than the failure to give reasons. If the reasons given are unintelligible, this will be equivalent to giving no reasons at all. The difficulty arises in determining whether the reasons given are adequate, whether, in the words of Megaw J, they deal with the substantial points that have been raised or, in the words of Phillips J. in Hope v. Secretary of State for the Environment, 31 P & C.R. 120, enable the reader to know what conclusions the decision-maker has reached on the principal controversial issues. What degree of particularity is required? It is tempting to think that the Court of Appeal or your Lordships' House would be giving helpful guidance by offering a general answer to this question and thereby "setting the standard" but I feel no doubt that the temptation should be resisted, precisely because the court has no authority to put a gloss on the words of the statute, only to construe them. I do not think one can safely say more in general terms than that the degree of particularity required will depend entirely on the nature of the issues falling for decision.
Whatever may be the position in any other legislative context, under the planning legislation, when it comes to deciding in any particular case whether the reasons given are deficient, the question is not to be answered in vacuo. The alleged deficiency will only afford a ground for quashing the decision if the court is satisfied that the interests of the applicant have been substantially prejudiced by it. This reinforces the view I have already expressed that the adequacy of reasons is not to be judged by reference to some abstract standard. There are in truth not two separate questions; (1) where the reasons adequate? (2) if not, were the interests of the applicant substantially prejudiced thereby? The single indivisible question, in my opinion which the court must ask itself whenever a planning decision is challenged on the grounds of a failure to give reasons is whether the interests of the applicant have been substantially prejudiced by the deficiency of the reasons given. Here again, I disclaim any intention to put a gloss on the statutory provisions by attempting to define or delimit the circumstances in which deficiency of reasons will be capable of causing substantial prejudice, but I should expect that normally such prejudice will arise from one of three causes. First, there will be substantial prejudice to a developer whose application for permission has been refused or to an opponent of development when permission has been granted where the reasons for the decision are so inadequately or obscurely expressed as to raise a substantial doubt whether the decision was taken within the powers of the Act. Secondly, a developer whose application for permission is refused may be substantially prejudiced where the planning considerations on which the decision is based are not explained sufficiently clearly to enable him reasonably to assess the prospects of succeeding in an application for some alternative form of development. Thirdly, an opponent of development, whether the local planning authority or some unofficial body like Save, may be substantially prejudiced by a decision to grant permission in which the planning considerations on which the decision is based, particularly if they relate to planning policy, are not explained sufficiently clearly to indicate what, if any, impact they may have in relation to the decision of future applications".
Very exceptionally, it may be said that the decision of the Secretary of State is irrational, but this can be only where the other known facts and circumstances point overwhelmingly in favour of a different decision; see R v Secretary of State for Trade aand Industry, Exparte Lonhro plc [1989] 1WLR 525 at 540 per Lord Keith
Finally, it is also necessary to bear in mind certain observations of Sir Thomas Bingham M.R., as he was, in Clarke Homes Limited v Secretary of State for the Environment and East Staffordshire District Council(1993)66 P.&C.R.263 where the construction of a decision letter was in issue. He said this:
"....the central issue in this case is whether the decision of the Secretary of State leaves room for genuine doubt as opposed to forensic doubt as to what he has decided and why. This is an issue to be resolved as the parties agree on a straightforward down-to-earth reading of his decision letter without excessive legalism or exegetical sophistication."(p.271-272).
In my opinion the following principles can be derived from these authorities:
(1) The Secretary of State must have regard to all material considerations before reaching his decision. These include the provisions of any development plan (which, by virtue of section 54A of the 1990 Act he is obliged to follow unless there are good reasons not to) and any other material considerations. In an appropriate case, these will include the merits of alternative sites.
(2) He need not, however, refer to all material considerations in his reasons. But he must state his reasons intelligibly and in sufficient detail to enable the informed reader and the court to understand the reasoning and to know what conclusion he has reached on the principal important controversial issues.
(3) The degree of particularity or detail required depends on the nature of the issues falling for decision. It is not, however, necessary for the reasons to be elaborately expressed; a concise statement of reasons will suffice.
(4) Any doubt as to the reasoning i.e. what the Secretary of State has decided and why, must be a genuine and not an artificial or forensic doubt. The doubt must exist on a sensible reading of the decision by an informed reader and not as a result of an excessively legalistic or over sophisticated analysis of the decision letter.
(5) When a planning decision is challenged for failure to give reasons as required by regulation 17, the single indivisible question for the court is whether the interests of the applicant have been substantially prejudiced by any deficiency in the reasons given.
(6) Such prejudice will include, but is not limited to, the three examples given by Lord Bridge in Save.
(7) As the first of these examples makes clear, a developer refused planning permission will suffer prejudice if the reasons are so inadequately or obscurely expressed as to raise a substantial doubt whether the decision was taken within the powers of the Act. It is not necessary to establish that the decision was in fact out with the powers of the Act.
(8) Exceptionally, where no or no adequate reasons have been given in relation to the principal issues in dispute, the court may infer that the Secretary of State had no rational basis for his decision, but any such inference should be made only where other facts and circumstances appear to point overwhelmingly in favour of a different decision.
Applying the law to the facts
The essential question I have to ask is whether either Applicant has been substantially prejudiced as a result of any defect in the reasons given by the Secretary of State. Plainly Macgay, as developer, will be able to show such prejudice if the reasons are so inadequately or obscurely expressed as to raise a substantial doubt as to whether the decision was taken within the powers of the Act.
The Applicants contend that the basis of the Secretary of State's decision is left completely obscure by his decision letter. They say that he purports to rely upon the reasons given by the Inspector but that this is puzzling because they are simply no longer applicable in view of the developments to which I have referred. The Secretary of State and the Third Respondent dispute this: they contend that the developments did not substantially change the position, and that the Secretary of State was fully entitled to base his decision on the reasons given by the Inspector. In resolving this issue, it is in my opinion necessary to analyse carefully the reasons why the Inspector made the recommendation that he did.
In my opinion the kernel of the Inspector's reasons for rejecting Kirk Deighton is found in paragraphs 14.36 and 14.38 which I have set out above. This is strongly supported by the fact that it is these two paragraphs to which cross-reference is made in paragraph 14.137 where the Inspector describes the reason for rejecting the site as being the "uncertainty as to whether, when and in what form the Wetherby-Walshford section of the A1 upgrading will take place". More specifically, as paragraph 14.38 makes plain, it was the uncertainty about funding- what the Inspector referred to as the "folly" of second guessing the outcome of a Treasury Spending Review- which was the most important factor of all. The Inspector envisaged that the other elements which created the uncertainty might be resolved by the time the matter came before the Secretary of State, but he did not anticipate that the funding issue would be. In my opinion he was saying that even if the construction were to take place at all, it was anyone's guess when that would be, and it would be irresponsible for him to base any recommendation in favour of Kirk Deighton on mere speculation about a favourable outcome to that question. I accept that he also had some concerns that there should not be undue delay before the MSA was built. This is clear from the fact that he considered it to be relevant that the other operators would be in a position to take up the planning permission without undue delay (para.14.35), and also by the fact that on his analysis Kirk Deighton, even on the most favourable scenario, would not be open and available to the public until three or four years later than the other proposals. He described this as a "substantial length of time" to expect users to put up with the current services (para. 14.37). It is pertinent to note, however, that he did not say that this delay would of itself be sufficient to discard Kirk Deighton, and indeed he did not cross-refer to this paragraph at all in his conclusions. The specific delay was a cause for concern, but in my view it was the general uncertainty which was decisive - so decisive that it meant that the merits of Kirk Deighton could no longer be compared with the other sites. As the Inspector put it in paragraph 14.138, Kirk Deighton "must fail in absolute terms on the question of whether and when it would be available"(my emphasis).
The Respondents contend that it is plain that the Inspector considered that the matter was urgent. Apart from the factors I have considered above, they submit that it is implicit in his having found the need to be "compelling" that it should be urgently met. They point to the fact that he did not conclude, as Macgay had contended, that the need was qualitative rather than quantitative and therefore not a matter of urgency. As I have indicated earlier in this judgment, I accept that the Inspector did not find that the need was purely qualitative. However, I do not agree that his description of the need as compelling implies that an urgent response was necessarily required. It was necessary to establish a real or substantial need in order to justify any MSA being constructed at all, given the fact that all of the proposals conflicted with the current development plan (see para.5.29of his report.) Accordingly, describing the need as "compelling" does not, in my judgment, necessarily imply urgency. For the reasons I have already given, I do not consider that the Inspector did conclude that the need was urgent in the sense that the time constraints to which Kirk Deighton would inevitably be subject, even if the "whether" question was swiftly resolved, would of itself be bound to defeat Macgay's application. If that had been the Inspector's view, it would have been very simple for him to have said so in terms.
In my judgment, therefore, the critical issue was the uncertainty. Had that changed by the time the Secretary of State came to give his decision? The applicants say that it had fundamentally altered: there was now a firm contract award date of 2002/03; there was a strong commitment to construct the motorway, as opposed to it being one of what the Minister termed the "wish" list of 150 schemes; and the funding was to be secured by a DBFO contract which took it outside Treasury spending control. In any event, the Minister had said that the money would be found to fund these schemes and that, say the Applicants, was a promise which it was reasonable to assume would be honoured. In short, the principal concern of the Inspector, namely the difficulty of predicting whether funding would be made available, was no longer an issue. Moreover, Macgay had submitted to the Inspector that the MSA could be built concurrently with the motorway, and he accepted that this would provide advantages in terms of sustainability and landscape mitigation. Obviously, therefore, this would reduce the potential delays before the MSA could be built.
The Respondents accept, as they were bound to do, that the development post the Inspector's report had an impact on the question whether the road would be built, but they submit that the Secretary of State was still justified in concluding that overall there remained too much uncertainty. Mr. Purchas Q.C., for the Third Respondents, points to a range of matters that remained uncertain notwithstanding the developments. Apart from the inherent uncertainty in any political commitment to act in the future, he identifies the fact that the DBFO contract will go ahead only if there are interested bidders who meet the value for money criteria, and that under that contract there was flexibility as to when the tenderer would be able to start construction. He submitted that there was no obligation on the Secretary of State to analyse all these various strands of uncertainty.
Mr. Mould, for the Secretary of State, put a different emphasis in his argument. He accepted that the subsequent announcements had indeed gone some way - and I believe he recognised a very substantial way- towards resolving the "whether" issue, since the programming and funding had been determined. However, the "when" issue, he submitted, remained decisive. In particular, it remained in doubt whether Kirk Deighton would become available even within three or four years of the other developers, which the Inspector had described as the "hypothetical and optimistic" scenario (para.14.37).
In my judgment the Applicants' arguments should succeed on this point. I consider that Mr. Stone Q.C., counsel for the Council, was correct in his submission that the nature of any uncertainty as it might have appeared to the Secretary of State was wholly different in character to that which caused the Inspector to reach the conclusions that he did. As he put it, in the real world of the administrator there could be no real doubt that the motorway would be constructed in accordance with the policy fixed by the Government. Even if there was genuine uncertainty about whether a successful DBFO contract would be entered into (which he did not accept), the Secretary of State should have spelt out that concern since it was radically different to the much more fundamental uncertainty perceived by the Inspector. I accept that submission: I do not consider that it was enough for the Secretary of State to have adopted the Inspector's reasons, as he did in paragraph 6 of his decision letter, when the basis of that reasoning had materially changed. In my view, an informed reader of the decision letter would genuinely be in doubt about the basis of the conclusion reached by the Secretary of State. Was it that the matter was so urgent that any delay was unacceptable? If so, I do not consider that this was in fact reflecting the views of the Inspector and it suggests that he might have misunderstood the Inspector's view about urgency. Was it that there remained uncertainty about whether the scheme would go ahead at all because of funding uncertainties, which was the decisive reason in the mind of the Inspector? Presumably not, since that was not the submission of the Secretary of State before me, although if the Secretary of State was adopting the Inspector's reasons, that would be his analysis. Furthermore, was the Secretary of State taking the view that the uncertainties that remained still involved the absolute rejection of the Macgay bid, or was he engaging in a balancing exercise in which the additional delays inherent in the Kirk Deighton scheme were weighed as against the planning and environmental considerations? Presumably the former, since that was the Inspector's view, although the Applicants say that this would not be justified given the different nature of the uncertainty, and that a comparison of the sites would now be necessary
It follows that I do not accept, as Mr. Purchas Q.C. submitted, that the Applicants have manufactured a forensic doubt and that the real meaning of the Secretary of State's letter is clear. In the circumstances of this case, it is not in my judgment sufficient for the Secretary of State simply to say that he has taken the material into account but that it has not caused him to depart from his decision. There may, of course, be perfectly cogent reasons why the Secretary of State would choose to confirm the recommendation of the Inspector, notwithstanding the post-inquiry developments. (This is clearly not in my view one of those exceptional cases where it can be inferred that the reasons were bad). In my judgment, however, the Secretary of State's reasons are not obvious from the decision letter when read together with the Inspector's report, and the Applicants have satisfied me - the onus being on them - that there is a real doubt about whether the Secretary of State did reach his decision in accordance with the powers of the Act.
It follows from this analysis that Macgay have been substantially prejudiced by the defect in the reasons. The position of the Council is different since they do not fall into the first of Lord Bridge's examples in Save. Mr. Stone submits that it is prejudiced by virtue of being the Local Planning Authority for the District in which the proposals lie. It has an interest in the appropriate site being properly chosen. In addition, he submits that the decision could influence future applications for in-fill sites which could be made, thereby bringing it within Lord Bridge's third category in Save. Although I think that the implications of the Secretary of State's decision for further applications are relatively marginal, since in large part the decision turns on its own facts, I am just persuaded that taken together with the Council's status as Local Planning Authority, its interest is such that it can claim to have suffered substantial prejudice under the Act. Accordingly, both Applicants are entitled to the relief sought.
Other Grounds
I now turn to consider the other grounds advanced by Macgay which, if sustainable, provide alternative bases for invalidating the decision of the Secretary of State. I summarise the grounds by reference to the description of them that I have given above.
(1) The Secretary of State failed to take into account the further information.
In my opinion this ground is manifestly unsustainable. The Secretary of State has said in terms that he has taken the further material into consideration. Absent bad faith, which is not and could not properly be alleged, that is the end of the matter.
(2) The Secretary of State took into account an irrelevant consideration, namely urgency.
This argument is closely interlinked with the primary contention on reasons, as will be clear from the earlier part of the judgment. As I have indicated, it is not clear in my view precisely what significance was given by the Secretary of State to the need urgently to build an MSA. However, if he did in fact consider that the need was very urgent, that was a view he was entitled to take. It would not have been an irrelevant consideration. In my judgment the proper criticism is that the decision leaves obscure precisely whether the question of urgency did in fact weigh with the Secretary of State, not that he could not properly have treated urgency as a relevant factor.
(3) Delaying pending a local plan
It is alleged that the Secretary of State failed to take into account the submissions which Macgay had made to the Inspector, namely that no decision about which site should be granted planning permission should be taken until the Harrogate local plan inspector had issued his report. It was submitted that it was for the local plan to address the question of the timing or urgency of the need. The Inspector was plainly aware of this submission since he recorded it (paras.8.5 to 8.8 and 8.128). Although he did not expressly deal with it, by implication he clearly rejected it by making a recommendation for planning permission in advance of the local inquiry report. Equally, the only reasonable inference is that the Secretary of State also rejected this submission. This was entirely in accordance with PPG 1 para.48 which indicates that generally planning applications should be considered in the light of current policies, although account can be taken of policies in emerging development plans, the appropriate weight to be given depending upon which stage the plan had reached. Similarly, Annex B to PPG13 makes it clear that in normal circumstances the Secretary of State should determine appeals expeditiously and should only in exceptional cases delay them so that they can be heard during the course of a development plan inquiry.
In my opinion in the light of these principles, the only possible complaint here is that neither the Secretary of State nor the Inspector had expressly dealt with this particular submission. The decision not to accept it was plainly open to them. This criticism can succeed as a matter of law only if the issue can fairly be said to be a principal controversial issue which the Secretary of State was obliged to address. I do not think that it would properly fall into that category, not least because it was not supported by any other party, not even the Council, who might be thought to have had the closest interest in this matter. Furthermore, the logic of the argument would seem to be that no decision at all should be taken until the local plan inquiry has been completed, but not even Macgay was arguing for that. They were not saying that it was premature to make any decision. Rather they were seeking to be granted planning permission in conjunction with the local planning process.
Even if I am wrong about this not being a principal controversial issue, I do not accept that Macgay has suffered substantial, or indeed any, prejudice by the failure of the Secretary of State to spell out what was in any event implicit in his decision, namely that it was not in his view desirable to depart from the normal approach which is to deal with appeals expeditiously and on the basis of current planning policies.
(4) The Green Belt issue.
This is again an allegation that the Secretary of State has failed to take into account a material consideration, namely the consequences for the Green Belt of the different sites. The argument was clearly advanced by Macgay before the Inspector. It was specifically put to him that only Kirk Deighton removed entirely the pressure for an "in-fill" MSA at Bramham, which is within the Green Belt, since it was only seven miles away from Bramham (para 8.31). The Inspector rejected the argument that this should be considered in the need assessment for the following reasons:
"The proposed MSA at Bramham is the subject of a current planning application but lies in the Green Belt and is not supported by a site-specific MSA allocation in the draft Selby Local Plan (10.19,10.20). Hence its fate is uncertain at this stage and I consider that it would be imprudent to include it in the "need" assessment."
The Inspector did, however, consider that a proposed MSA at Skelton Grange should be taken into account for the following reason:
...I agree...that material weight should attach to the proposal for a new MSA at Skelton Grange on the M1-A1 Link itself. Although no planning application has yet been made, it is a brownfield site outside the Green Belt identified for an MSA in the Leeds Deposit Draft UDP, albeit subject to objections (7.18,10.17).Accordingly, although there can be no certainty, it seems to me that there is a greater likelihood of this than either Bramham or Selby Fork."
The Inspector then put Skelton but not Bramham in his "gapping" matrix.
Macgay say that the Inspector erred in failing to give consideration to the possibility of an MSA at Bramham. I reject that argument. It was a matter for his judgment whether he should give any weight to the possibility of an MSA there, and he gave cogent reasons for choosing not to take it into consideration. Macgay then have another point. After the inquiry, Bramham was included in the Selby District Local Plan and the Secretary of State was notified of this by the letter of January 13, 1999 to which I have already referred. Macgay contends that he has failed to reconsider the Inspector's recommendations in the light of this material change, or alternatively has not given reasons for continuing to select Kirby Hill.
In my judgment neither of these arguments can succeed. As to the first, the Secretary of State in terms said that he had taken account of the information given in the letter; the fact that it has not caused him to change his view is irrelevant. As to the second, the Secretary of State was not obliged to give a specific explanation about the implications of the new information for the Green Belt issue. In my judgment this was not a principal controversial issue. In my opinion that is supported by the fact that the Secretary of State's attention was not even drawn to the Bramham issue in the context of these appeals at all. This is a matter to which I have already made reference. Had this information been seen to be crucial to these appeals, much more would have been made of it in that context.
(5) Irrationality in respect of the landscape impact of Kirby Hill
The final ground of appeal is that the Secretary of State acted irrationally in accepting the recommendations of the Inspector that Kirby Hill would be acceptable in landscape terms. In fact the argument as developed was not really that the decision was perverse or irrational in a Wednesbury sense, but rather that the Inspector had misunderstood the factual basis for his decision, in two material ways. As I understand it, it is accepted that if there were no misunderstandings, this ground fails. That must be right since questions of this nature are classically issues for the Inspector unless his judgment is plainly perverse, and that could not seriously be alleged here. I will consider the two alleged misunderstandings in turn.
The first related to woodland planting. The Woolerton Truscott report recommended planting tree cover in blocks of 2 to 5 hectares. The Inspector recommended that 20 hectares should be planted. He said this (para. 14.113):
"With regard to the proposed woodland planting, it is true that his would be extensive and that there are currently few trees in the area. However, it is equally true that the "absence of significant woodland blocks" is identified as the first of the negative attributes of this landscape in the WT report (9.80). Moreover, contrary to the council's claim (10.76), the report expresses the view that "This open rural landscape offers opportunity for significant change..." (9.81) and under "Landscape Guidelines" advocated the introduction of new woodland planting in large blocks of 2-5Ha (9.82). Hence it appears to me that the proposed woodland planting would accord with the recommendation of the WT report to provide a more diverse landscape and also to create new habitat and opportunities for wildlife (9.82) in an area somewhat arid in these respects".
It is said that the Inspector has plainly misunderstood the position. How otherwise, it is said, could he have thought that a 20 hectare area was in accordance with the recommendation for blocks of 2 to 5 hectares? In my view this is a misreading of the report. The Inspector did not say that his precise recommendation would accord in every way with the Woolerton Truscott advice: he said that it would accord with the aim to provide a diverse landscape, new habitat, and opportunities for wildlife which had also been the aim of the Woolerton Truscott recommendation. He did not misunderstand the position as alleged.
The second alleged misunderstanding relates to mounding. The Inspector concluded that an artificial perimeter mound would not constitute an unacceptably alien feature in the landscape (para.14.110). His analysis of the relevant landscape was as follows (para.14.107):
"The landscape here - Floodplain Type 3; Rolling Arable Farmland (8.54) is acknowledged to be of different quality to the other sites (8.71, 7.95) and is described as wide open with large scale intervisibility (4, 8.71). The Council were advised that it is fragmented and in need of the reintroduction of structure and repair (6.87). I do not demure from these observations nor from the view expressed by HIA that the landscape character is unremarkable (9.79). Its main characteristic is its large scale openness, but any benefit that this might offer is offset by the absence of any significant natural features or interest to relieve the general uniformity of very large arable fields stretching into the distance. Relief is provided only by man-made features, including the A1(M), the Ripon Road overbridge and roundabout, and the development at Dishforth Airfield (9.79)".
It will be seen that there is a cross reference to paragraph 9.79. Macgay says that in his description of the site, the Inspector wholly misunderstood what was being said in that paragraph about the site. That paragraph reads as follows:
"Inevitably, the proposed MSA would have some impact. However, the landscape character is unremarkable. It is classified in the WT report (CD4, p68) as "Floodplain Farmland Type FF3 - Rolling Arable Farmland, characterised by open, intensively farmed arable land in large fields on gentle rolling round where trees and woodlands are generally scarce. The report observes that the open rural character of the landscape is degraded by a number of urban elements including Dishforth airfield, the A1(M), the A168 and their elevated junctions at Ripon Road, Marton-le-Moor and Dishforth (CD4, pp65 & 68). Of all the sites before the Inquiry, this undistinguished and degraded landscape is the least constrained in environmental terms. It also provides the best scope for assimilation into its surroundings by means of significant landscape planting wholly in accordance with the WT report strategy".
The Applicant submits that this paragraph makes it clear that the urban features degrade the landscape whereas the Inspector appears to have thought that they improve it. I do not believe that the inspector was saying that: he merely noted, quite accurately, that the urban features did in fact relieve the landscape. His recommendation about mounding was then made with a full appreciation of the nature of the site. In my opinion there is no basis for saying that he misunderstood the position and accordingly the Secretary of State was fully entitled to follow his recommendations.
Conclusions
In my judgment the Secretary of State failed to give adequate reasons for his decision, and both Applicants have been substantially prejudiced as a result. The other grounds of appeal fail. The outcome, however, is that the decision of the Secretary of State must be quashed and the decision will have to be reconsidered.


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