The Committee noted that the Rights of Light - City Pride Development & Island Point Development had been considered by the Mayor in Cabinet on 7 January, 2015 and was “Called In” in respect of the proposal that the Council intervenes in a commercial dispute between a developer and local residents by Councillors Candida Ronald; Shiria Khatun; Andrew Cregan, Marc Francis and Rachel Blake.  This is in accordance with the provisions of rule 16 of the Overview and Scrutiny Procedure Rules in Part 4 of the Council’s Constitution.

The Call-in requisition signed by the five Councillors listed above gave the following reasons for the Call-in:

              I.                The Council is proposing to intervene in a commercial dispute between a developer and local residents - taking the side of the developer against the interests of its own residents - using legislation which was intended to be used in the development of major public infrastructure and not in residential developments. The existing legislation in such matters specifically provides for such disputes to be resolved at law, creating a "balance between development and protection, influenced by the particular factors of the situation favouring injunction or damages." [Law Commission report Rights to Light 2014];

            II.                The Council is not a disinterested party in this matter with the large amount of s106 planning gain at stake and has no business intervening in a purely commercial dispute.

           III.                That the Mayor fully consider and outline the impact of such a decision on future developments in the borough; and

          IV.                That the decision on rights of light be left to the courts.

In addition to the business papers presented to the Overview and Scrutiny Committee, the Committee considered:

1.            The views and comments made by Councillor Candida Ronald in presenting the call-in;

2.            The information provided by Councillor Rabina Khan;

3.            The information provided by Jackie Odunoye (Head of Strategy Regeneration & Sustainability) and Monju Ali (Projects Officer - Housing Regeneration)

4.            Representations made by Marcus Bate - Pinsent Masons LLP; Peter Exton - Tower Hamlets Community Housing and Jerome Webb - Chalegrove Properties.

The main points of the discussion maybe summarised as follows:

The Committee:

·                     Noted that the development included a tall building that would overshadow adjoining properties resulting in an impact upon their quality of life of residents living in those properties. 

·                     Noted that 15 residents have not yet agreed a level of compensation with the developer and that the Council aims to get the correct compensation for these owners.

·                     Noted that the granting of an injunction does not necessarily preclude the development from going ahead.  A court could decide in favour of the development and set levels of compensation for affected landowners (i.e. that this particular decision should be left to the courts). 

·                     Noted that it is very important that the justification for exercising such powers is sufficiently robust in order to withstand any legal challenge.

·                     Was advised that the scheme would have a positive benefit for 400 families by reducing overcrowding and set a new bench mark in social housing

·                     Noted that Section 237 is only used to overcome key impediments to a scheme that is intended to address housing needs and to bring improved social and economic wellbeing to a particular area (e.g. the 70 shared ownership and 131 rented properties in these schemes).  In addition, in any given development the homes built will then go onto the common housing register and residents would be able to bid for these properties.  In addition, schemes such as City Pride and Island Point will help to reduce the numbers of homeless families in Tower Hamlets as well as addressing the complex health/medical needs of these families.

·                     Noted that “Right to Light” is a form of easement in English law that gives a long-standing owner of a building with windows a right to maintain the level of illumination.  The use of such injunctions by owners has become established as a primary remedy over a period of time in the courts to stop such a loss or to decide if the financial payment offered to the owner is considered to be adequate for a particular claim.

·                     Noted that the Council cannot use its power simply to save the developer money; there must be a clear socio- economic benefit to the local area.  These benefits must be able to be quantified and proved, and be benefits which would disadvantage the Council’s objectives if they were lost (i.e. The Council continues to face challenges in meeting the huge demand for affordable housing and attempting to reduce the significant overcrowding that many in the community experience).

·                     Noted that Section 106 payments cannot be taken into account because these payments are to mitigate the impacts of the development, therefore in essence if the development does not go ahead they will not be required and there is no loss to the locality. Although in practice these payments are hugely beneficial to the Council this is not in itself sufficient.

·                     Noted that the use of Section 237 of the Town and Country Planning Act 1990 potentially stops injunctions that would otherwise prevent the implementation of schemes that have over-riding social or economic advantages to a particular area and whilst in London primarily its use has been in relation to commercial properties within the City it has also been utilised by other boroughs in residential developments (e.g. Hackney; Hammersmith and Fulham and Kensington and Chelsea).

·                     Noted that the use of Section 237 was not one that had been taken lightly and in relation to City Pride & Island Point Developments it was made so as to take control of the process for the benefit of the Borough as it was considered that the development would not go ahead without the use of Section 237.

·                     Was advised that the statutory objective which underlies Section 237 of the 1990 Act is that, provided that work is done in accordance with planning permission, and subject to payment of compensation, a Local Authority should be permitted to develop its land in the manner in which it, acting bona fide, considers will best serve the public interest.

·                     Expressed concern that whilst these schemes may address social or economic needs for a particular area they will put increased pressure on school places; open space and public transport.  In response it was noted that the infrastructure needs will be addressed in the development of these schemes.

·                     Noted that all the residents affected by these schemes have been written to by the Council and have had their “Rights to Light” position carefully explained.

·                     Noted that the Council was satisfied that there was real risk that if the owners injunct the development it would not go ahead.

·                     Indicated that it felt that there should be no further use of Section 237 of the Town and Country Planning Act 1990 in the Borough until there is a clear policy in place with regard to it use.  Therefore, the Mayor should fully consider and outline the impact of such a decision on any future developments.

·                     Was concerned that consideration should not only be given to the provision of affordable housing in such schemes but also to the density of developments and the impact that they would have on the skyline in the neighbourhood.

·                     Wanted to be assured that the Council has required the developer to demonstrate a significant degree of intransigence on the part of those owners before it would be justified in exercising its powers under Section 227 so as to defeat “rights of light”.

As a result of a full and wide ranging discussion on this report the Committee

RESOLVED to refer the matter back to the Mayor for reconsideration with a recommendation that:

There should be no use of Section 237 of the Town and Country Planning Act 1990 in the London Borough of Tower Hamlets until there is a clear policy in place with regard to its use.

Action by:

Jackie Odunoye (Head of Strategy Regeneration & Sustainability)