Planning & Environment

The recent decision of Lord Hodge in MacTaggart & Mickel Homes Ltd v Hunter is well worth a read. It documents the struggle a developer can have to get planning permission.

One of the principal issues was whether MMHL had used “reasonable endeavours to obtain the Planning Permission”, as required by the missives. This is a common provision in missives for development land. Some planning agreements also use the phrase “reasonable endeavours”.

The decision shows the importance of understanding what a phrase means before using it. Lord Hodge noted that “reasonable endeavours” is a less onerous requirement than “all reasonable endeavours” or “best endeavours”.

Lord Hodge accepted the evidence from the other side’s planning expert, that there were things that MMHL had not done which they could have done. However, MMHL did not need to do those things to meet its obligation of reasonable endeavours. The judge held that none of those things would have made any difference to the attitude of the planning authority to the principle of development on the scale envisaged by the missives.

Although this decision provides some reassurance to developers, what needs to be done in an individual case will depend on the circumstances. Lord Hodge summed it up: “what would a reasonable and prudent Board of Directors acting properly in the interest of their company and applying their minds to its contractual obligations have done to try to obtain the planning permission?”

Neil Collar

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