Open spaces – a trap for the unwary developer and a salutary lesson for local authorities

Bringing sites forward to development is always fraught with potential pitfalls for the unwary developer. One of those pitfalls can be found in the Open Spaces Act 1906 which was brought into focus by a Supreme Court Case decision earlier in the year.

Learnings from R (Day) v Shropshire Council and another [2023] UKSC 8

The case, R (Day) v Shropshire Council and another [2023] UKSC 8, concerned the sale of land at Greenfields Recreation Ground by Shropshire Town Council for development. The land had been acquired by statutory predecessors to the Town Council as a recreation ground and subsequently used as an allotment and council tree nursery before that use ceased earlier in the century.

The Town Council obtained planning permission from Shropshire Council for development and subsequently sold the land to a private developer. A local objector to the development of the site – Mr Day – who had investigated the history of the site using town archives, brought judicial review proceedings in relation to the planning permission. Mr Day relied on the fact that when planning was granted a material consideration had been ignored, this being the statutory trust created by the Open Spaces Act 1906. The judicial review was successful at the Supreme Court and the planning permission was quashed.

Section 10 of the Open Spaces Act 1906 provides that where a local authority has acquired open space under the Act – namely acquiring the land as public recreation ground – then they shall “…hold and administer the open space… in trust to allow, and with a view to, the enjoyment thereof by the public as an open space…”

This statutory trust can be extinguished where the local authority subsequently disposes of the site and has correctly followed the specific procedures laid down in section 123 of the Local Government Act 1972. The provisions of s.123 are designed to ensure that members of the public have ample opportunity to learn what is proposed and the right to contend that the statutory trust land should not be sold. In this case, the correct process had not been followed and therefore the developer was found to have acquired the land subject to the statutory trusts created by the Open Spaces Act.

Warnings for developers

The concern for developers will be that this developer had acquired in good faith and with good title to the land, but that this was subject to the statutory trusts created by the Open Spaces Act. With the developer left holding the land which might never now be developed, they will presumably have to look to see what rights of remedy they might have against the Town Council unless a negotiated agreement can be reached.

The case provides a useful warning to developers that when acquiring land from the local authority, clear enquiries need to be made to be satisfied as to the basis on which the land is held. For local authorities it highlights the very clear need to undertake the appropriate investigatory work to establish the status of the land and to follow the correct statutory procedures on disposal.

The council had acted under the incorrect belief that the land in question fell outside of the recreation ground. Having ended up being embroiled in an expensive and time-consuming legal case for some five years, and with calls for the council to buy the land back, the oversight may well prove to have been a very costly one.