Simon Dimmick and Kayleigh Chapman, in our Planning & Environmental Law team, discusse Regulation 117 of the Community Infrastructure Levy Regulations 2010 (as amended).
Two recent appeals under Regulation 117 of the Community Infrastructure Levy Regulations 2010 (as amended) highlight the strict nature in which the Regulations are being applied.
The CIL Regulations permit a Collecting Authority to impose surcharges in respect of certain events which may occur such as the failure to submit a Commencement Notice (Regulation 83), failing to assume liability (Regulation 80) or for late payment (Regulation 85). These surcharges range depending on the event in question from £50.00 to £2,500.
Regulation 117 permits appeals against a decision of a Collecting Authority to impose a surcharge on 3 grounds:
a. the claimed breach did not occur
b. the Collecting Authority did not serve a Liability Notice
c. that the surcharge has been calculated incorrectly
Appeal One
The first appeal related to a surcharge imposed on Appellants for failing to submit a commencement notice to the Collecting Authority. The Appellants had called the Collecting Authority to pay the CIL charge in respect of their development over the phone. They had spoken to Customer Services who when asked if there was anything else they needed to do replied that nothing more was required. As a result of this advice from the Collecting Authority they did not submit a Commencement Notice. They were subsequently issued a surcharge for failing to do so.
The Inspector felt sympathetic to the Appellants. Had the Appellants received the proper advice from the Collecting Authority they would have ensured the notice was submitted. However, the information was available on the Liability Notice, Demand Notice and the Council’s website. Therefore the Inspector whilst considering the Appellants to have mitigating circumstances had no choice but to uphold the surcharge as the Appellants had failed to submit the required Commencement Notice.
Appeal Two
The second appeal relates to the imposition of a surcharge for late payment of CIL. A Liability Notice was issued on 20 June 2016 followed by a Demand Notice on 13 July 2016. However, the Appellants appealed under Regulation 114 to the Valuation Office Agency (“VOA”) putting matters on hold, the VOA’s decision was issued on 26 September 2016.
The Collecting Authority subsequently reissued a Demand Notice on 19 October requiring payment by 2 November 2016. The Appellant requested in a letter on 22 October 2016 to pay by instalments and despite the request not falling within the Collecting Authority’s instalment policy they agreed to consider it. However, on 8 December 2016 the Collecting Authority sent a further Demand Notice including a later payment surcharge and interest. The Appellant appealed the surcharge.
The Inspector agreed with the Appellant that it was “perverse” to demand a late payment surcharge when the appellant was clearly waiting for a decision on whether he could pay the charge by instalments. However, he concluded that the “inescapable fact [was] that the Appellant did not pay the CIL by the deadline given in the demand notice of 19 October 2016” despite significant mitigation put forward by the Appellant.
Conclusion
It is clear from the above two appeals that there are circumstances where a developer can demonstrate significant mitigation evidence as to why a failure to comply with the CIL Regulations occurred. However, the Inspector is unable to take account of these circumstances when assessing any appeal but must consider whether there was indeed a failure irrespective of mitigation.
This would seem particularly harsh for lay-persons with no knowledge of the regime.
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This article is intended for the use of clients and other interested parties. The information contained in it is believed to be correct at the date of publication, but it is necessarily of a brief and general nature and should not be relied upon as a substitute for specific professional advice.
