Marks and Spencer secures quashing of Secretary of State’s decision to refuse planning permission

The recent judgment of the High Court in Marks & Spencer Plc v Secretary of State for Levelling Up Housing and Communities [2024] EWHC 452 (Admin) has received a lot of attention given its implications for the repurposing and reuse of existing buildings. 

The case concerned proposals by Marks & Spencer (“M&S”) to demolish their existing store on Oxford Street, London and to replace it with a nine-storey mixed use office and retail store, including a restaurant and a gym.

The case was brought by M&S against the Secretary of State (“SoS”) following his decision to reject the recommendations of his appointed Planning Inspector who had recommended that planning permission should be granted.

In bringing their challenge, M&S raised a number of grounds in seeking an order from the Court quashing the decision of the SoS, in particular arguing that the SoS had misinterpreted planning policy and had failed to provide adequate reasons in reaching his decision. 

The challenge succeeded, the refusal of planning permission was quashed, and will now require the SoS to reconsider his decision.

This Law-Now addresses the grounds that were raised by M&S and the Court’s response to them.

Ground One – error in interpretation of paragraph 152 of the NPPF

In relation to this ground, M&S’ claim was that the SoS was incorrect in saying that there was a ‘strong presumption in favour of repurposing and reusing buildings’ within paragraph 153 of the National Planning Policy Framework (“NPPF”). This was the SoS’ interpretation of the NPPF but was not the test in the policy, which encourages the reuse of buildings but does not go so far as to impose a presumption in favour of reusing buildings. The SoS’ interpretation was found to be wrong, and M&S succeeded on this ground.

Ground Two – error in consideration of alternatives

This ground asserted that the SoS made mistakes when considering whether there were deliverable and viable alternatives to M&S’ proposals. The SoS’s views on alternatives differed from the Inspector’s and, whilst the Court found that he was entitled to reach a different conclusion, the SoS should have explained in clear terms why that decision was reached. In this case, the SoS failed to set out how the identified ‘gaps and limitations’ in M&S’ evidence undermined the Inspector’s reasoning on alternatives. Without this analysis it was impossible to understand whether or not the SoS had reached a rational and lawful decision and so M&S’ case also succeeded on this ground.  

Ground Three – error in balancing public benefits against heritage impacts

In this ground M&S asserted that the SoS had failed to properly grapple with the implications of a refusal and the loss of the benefits of the M&S store, thus departing from development plan policies which supported Oxford Street and the West End as a retail and commercial area. Whilst the SoS accepted the public benefits of the proposal he found that they were outweighed by the heritage harm. He also found that whilst there was limited weight to be given to the harm to the vitality and viability of the area if permission was refused, the benefits to employment and regeneration of the scheme carried significant weight.  The Court found these conclusions to be contradictory and the SoS’s reference to the finding that the site might not become vacant and underused did not explain the inconsistency and so M&S also succeeded on this ground.

Ground Four – lack of evidence for conclusions on harm regarding vitality and viability of Oxford Street

M&S’ fourth ground of challenge related to the harm to the vitality and viability of Oxford Street if the scheme, or an alternative, was not delivered. M&S had said that if planning permission was refused, they would likely vacate the store and invest elsewhere. The SoS commented that there would be some harm to the vitality and viability of Oxford Street if this happened but disputed that harm would be caused to the wider West End beyond Oxford Street.

The Court found that this departed from the relevant development plan policies which referred to one “town centre” and said that it was obvious from the Inspector’s report that significant harm to vitality and viability at the western end of Oxford Street would have implications across the centre because of the loss of footfall and investment across the designated town centre. Disagreement over this interpretation of policy should have been explained clearly by the SoS. The Court also found that the SoS failed to explain why the harm from the loss of investment and loss of a strong retail attraction at the site ‘would be limited’. This ground of M&S’ case also succeeded. 

Ground Five – error of fact regarding embodied carbon, misapplication of policy on embodied carbon

The fifth ground related to errors of both (a) fact and (b) the interpretation of the London Plan policy on carbon consequences:

(a)    An alternative to M&S’ proposals had been put forward by an objector and included an outline option for a comprehensive refurbishment of the existing building. The SoS’ decision proceeded on the basis that there was no dispute between the parties that redevelopment would involve much greater embodied carbon than refurbishment. However, the SoS subsequently argued in Court that it was aware of a dispute in respect of the specific scheme and alternatives and that the agreed position related only to an ‘in general’ proposition that a refurbishment would involve less carbon than a redevelopment. This factual error was found to be important to the overall decision because it resulted in a clear gap in the SoS’s decision as to whether harm would have flowed from either scheme.

(b)   The policy error related to how carbon consequences are divided into those emanating from the construction phase (embodied carbon) and those from the operation of the development (operational carbon). The carbon offsetting requirements within policy are in relation to operational carbon only. The SoS’s decision was confused on this point and assumed that the requirement for carbon offsetting in the London Plan applied to embodied carbon and not just operational carbon. This was an approach that had never previously been applied. The Court found that the scale of the SoS’s error and the importance of this issue to the overall planning balance meant that it was more than possible that had the SoS properly understood the policy, he may have concluded differently.

Ground Six – error in analysis of impacts on setting of Selfridges and Stratford Place Conservation Area

The sixth ground concerned whether there was any harm to the significance of listed buildings or the conservation area by reason of an impact on the setting of heritage assets. The SoS found that the associated harm carried very great weight and the Court noted that this (along with the carbon issues) resulted in the SoS’s refusal.  M&S sought to argue that the SoS had not provided adequate reasoning on this issue, but the Court disagreed, finding that whilst there was more that could have been said on the matter by way of further detail, it did not amount to unlawful reasoning.  

Consequently, this part of M&S’ case did not succeed.

Overall conclusions

The Court’s decision in the M&S case was highly critical of the SoS’s approach and highlighted the importance of providing clear reasoning when making decisions, particularly when departing from an experienced Inspector’s recommendations.

The decision also highlights the pitfalls of failing to interpret planning policy correctly and provides helpful clarifications on relevant tests in the NPPF and what they require in relation to the repurposing and reuse of buildings as well as regarding the interpretation of the London Plan and carbon off-setting requirements.  

This was a big decision and deserving of the attention it has received since judgment was handed down at the beginning of March.  However, it is not the end of the matter as the decision must now be remitted back to the SoS for his re-determination.  It remains to be seen whether the SoS will now follow his Inspector’s recommendations and grant consent or find different reasons to lawfully refuse planning permission.

Article co-authored by Christie Smith, Trainee Solicitor at CMS