A Section 106 Agreement is a legal agreement between the Planning Authority and the applicant/developer and any others that may have an interest in the land.
In a limited number of cases, where only the applicant needs to be bound by a planning obligation and not the Planning Authority, instead of agreeing obligations through the standard process of discussion (negotiation and agreement) it may be acceptable and advantageous for the developer to make a unilateral offer or "unilateral undertaking" to the Planning Authority to settle obligations relevant to their planning application.
"Section 106 Agreements" and "Unilateral Undertakings" are types of Planning Obligation authorised by Section 106 of the Town and Country Planning Act 1990 as amended by Planning and Compensation Act 1991 Section 12.
Planning Obligations are used following the granting of planning permission (normally major developments) to secure community infrastructure to meet the needs of residents in new developments and/or to mitigate the impact of new developments upon existing community facilities. They can also be used to restrict the development or use of the land in a specified way or require specific operations or activities to be carried out on the land.
Benefits will be secured either in kind or via financial contributions depending on what is required. The commonest issues that arise are affordable housing, primary and secondary education, urban open space, highways improvements and Healthcare. This list is not exhaustive and any other relevant and necessary matter may be included within a Planning Obligation that cannot be secured through the normal planning process but is required in order for the development to be deemed acceptable in planning terms.
What are planning obligations used for?
Planning Obligations are usually completed following the resolution to grant planning permission (normally major developments) to secure community infrastructure to meet the needs of residents in new developments and/or to mitigate the impact of new developments upon existing community facilities or infrastructure. They can also be used to restrict the development or use of the land in a specified way or require specific operations or activities to be carried out on the land. It should be noted that the planning permission is only issued after the completion of such obligations.
Who may enter into a Planning Obligation?
Planning Obligations are legally enforceable against the owner(s) (including their successors in title) of the land to which they relate. This means that generally only owners can enter into obligations even if a prospective purchaser/developer of the land has applied for the planning permission (although it is possible for prospective purchasers to be party to the obligations where they have exchanged contracts to purchase).
Because planning obligations run with the land (meaning any outstanding obligations will be transferred with the land), all owners, lessees and mortgagees must be signatories. Planning obligations can have significant effects on the use and therefore the value of land. Before anyone enters into a planning obligation we strongly advise that they take independent legal advice or contact the Planning Services Section for pre-application advice.
What are the costs of entering into a planning obligation?
The completion and subsequent monitoring of Planning Obligations is very time and resource consuming on local planning authorities and therefore the developer has to contribute to these costs. The Local Planning Authority will therefore include a monitoring cost within each completed planning obligation.
How are Planning Obligations secured?
Planning obligations are secured by a formal deed whether in the form of a Unilateral Undertaking signed by the parties giving the obligations or by Agreement. When it is by agreement, it will also be signed and sealed by the District Council. It will contain covenants (the planning obligations) covering the things the landowner agrees to do and / or agrees not to do.
The planning obligation will detail the circumstances and timescales within which these obligations will occur. It will also contain a plan showing the land to which it relates.
How are Planning Obligations enforced?
Planning Obligations are enforceable by Derbyshire Dales District Council:
- In the courts by application for an injunction or recovering contributions payable;
- By carrying out any operations required by the Planning Obligation and recovering the cost from the person(s) against whom the obligation is enforceable.
How are Planning Obligations recorded?
As a Planning Obligation runs with the land to which it relates, it is registered as a Local Land Charge on the Land Charges Register and will be revealed in any search submitted on behalf of a potential purchaser of an individual plot or entire development site. It is therefore important that all obligations are complied with as non compliance may be revealed in a search, which is likely to put off potential purchasers.
Can planning permission be issued without completion of a planning obligation?
No, where it has been identified that a development proposal requires matters to be dealt with by way of a planning obligation in order to enable the development to be deemed as acceptable in planning terms, planning permission cannot be issued until the associated planning obligation has been checked by our Solicitors and subsequently signed and dated by all parties (thereby completed).
Can I get advice on the required S106 contributions prior to submitting a planning application?
Yes, we are able to provide you with advice and information if you are considering submitting a development proposal. We welcome and encourage discussions before you submit your application. We acknowledge the advantages of providing good quality advice to developers and their agents prior to the formal submission of a planning application in order to help speed up the development process and avoid unacceptable proposals.
Director of Planning and Housing Services
Derbyshire Dales District Council
Phone: 01629 761 368