Case No: CO/4516/2015
Neutral Citation Number: [2016] EWHC 448 (Admin)
IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
ADMINISTRATIVE COURT

Royal Courts of Justice
Strand, London, WC2A 2LL

Date: 03/03/2016

Before:

THE HON. MRS JUSTICE PATTERSON DBE

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Between:

	THE QUEEN (on the application of ORBITAL SHOPPING PARK SWINDON LIMITED)	
Claimant	
	- and -		
	SWINDON BOROUGH COUNCIL
- and -
NEXT PLC	Defendant

Interested Party	

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Neil Cameron QC and Michael Ripley (instructed by Norton Rose Fulbright LLP) for the Claimant
Anthony Crean QC and Killian Garvey (instructed by Swindon Borough Council) for the Defendant
No representation or appearance for the Interested Party

Hearing date: 24 February 2016

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Judgment
Mrs Justice Patterson: 
Introduction
1.	On 12 August 2015 the defendant issued a Community Infrastructure Levy (“CIL”) Liability Notice under regulation 65 of the Community Infrastructure Levy Regulations 2010 (as amended) (“the CIL Regulations”) in relation to the installation of a mezzanine floor and external alterations including new shop fronts at unit C3/C4 North Swindon District Centre, Abbey Meads, Swindon.  The Liability Notice notified the claimant that it would be liable to £170,900 of CIL to the defendant as CIL collecting authority.  
2.	On 20 August 2015 the defendant served a Demand Notice under regulation 69 of the CIL Regulations in respect of the same development demanding £173,842.25 including surcharges and late payment interest.  
3.	This is a challenge to the lawfulness of the act of the defendant in issuing each of those notices.  
4.	Permission was granted by Holgate J on 10 November 2015.  
5.	At the heart of the proceedings is the correct interpretation of regulation 6(1)(c) of the CIL Regulations.  
Factual Background
6.	The claimant is the freehold owner of unit C3/C4 which is part of the Orbital Shopping Centre at Haydon Wick, Swindon, Wiltshire.  
7.	Unit C3/C4 is occupied by the interested party, Next PLC.  Prior to the carrying out of the works that have become the subject of the impugned notices the Next store comprised a ground floor of 2,349 square metres retail floor space and a mezzanine floor of 326 square metres non-trading floor space.  
8.	In January 2015 the claimant submitted two separate planning applications to the defendant: one for the installation of a mezzanine floor at unit C3/4; and the other for external works to the unit.  The external alterations application created no additional floor space.  
9.	The covering letter with the applications was dated 27 January 2015.  That said that the application sought the enhancement of the existing Next store.  The insertion of the mezzanine floor would result in a net increase in floor space of 1,709 square metres which would be used for retail purposes.  The application, if granted, meant that the permitted floor space exceeded that which was permitted under a section 106 agreement concluded in 2000.  Accordingly, a request was made in the letter to modify that agreement.  
10.	At the time that the planning applications were submitted the defendant did not have an adopted charging schedule for CIL.  One was being prepared for adoption.  It was duly adopted and came into effect on 6 April 2015.  
11.	Mr Blatchford, who is the claimant’s planning consultant, explained in his witness statement that the strategy to submit two separate planning applications was deliberate.  It was undertaken to avoid the possibility of later incurring liability to CIL in respect of the increase in floor space in the unit as a result of the mezzanine application.  Although the two applications were linked as they sought alterations to the same unit to meet the operational requirements of Next PLC the mezzanine application related only to the interior works of the unit.  Mr Blatchford continued:
“It would be entirely possible to implement the mezzanine permission and install and operate the mezzanine floor without implementing the external alterations planning permission or otherwise affecting the exterior of the unit.”
12.	In a Decision Notice dated 5 June 2015 the defendant granted planning permission for the installation of a mezzanine floor.  Attached to the permission was the following informative:
“The development constitutes Community Infrastructure Levy (‘CIL’) liable development.  CIL is a mandatory financial charge on development … to avoid additional financial penalties the requirements of the impact of CIL must be managed before development is commenced and subsequently payment made in accordance with the requirements of the CIL Demand Notice issued.”
13.	By a decision notice of the same day the defendant granted permission for external alterations to the same unit including new shop fronts.  No informative was attached to that planning permission.  
14.	In a letter dated 9 June 2015 solicitors for the claimant wrote to the defendant.  The letter said “The purpose of this letter is to alert you to the fact that the informative on the decision notice which states that the development is liable for Community Infrastructure Levy (‘CIL’) is incorrect.”  The letter continued:
“The planning permission granted on 5 June 2015 only permits internal operations at Units C3 and C4.  It is only required for the installation of the proposed mezzanine floor because of the effect of Article 44 of the 2015 Order and S.55(2A) of the Town and Country Planning Act 1990.
It follows that the development permitted by the planning permission is the type covered by Regulation 6(1)(c) of the CIL Regulations and is not, therefore, to be treated as development for the purposes of CIL – in other words, the development cannot be liable for CIL.”
15.	The defendant responded in a letter dated 17 June 2015.  In that letter the defendant set out its view that the application for planning consent for the additional external works was a direct consequence of the mezzanine proposal.  Notwithstanding that a separate planning application had been submitted for the external works:
“It is evident that these external works are inextricably linked to the mezzanine proposal.  …  
Given the circumstances set out above, the Council concludes that the existence of the accompanying facilitative application for external alterations to the premises, albeit under a separate application, justifies the position that the Council has taken in respect of this matter, … thus in this case the development proposals fall within the scope of the meaning of development for CIL purposes due to the direct link between the two applications for the mezzanine and external alterations.  It is for this reason that the Council will continue to produce a CIL Liability Notice associated with S/15/0116.”
16.	Each of the two planning permissions was implemented on 27 July 2015.  The works are now complete.  
17.	On 12 August 2015 the defendant issued a CIL Liability Notice.  
18.	On 20 August 2015 the defendant issued a Demand Notice.  
Legal Framework
19.	Under section 206(1) of the Planning Act 2008 (PA) a local authority may charge CIL in respect of development in its area.  
20.	Section 208 provides:
“(1) Where liability to CIL would arise in respect of proposed development (in accordance with provision made by a charging authority under and by virtue of section 206 and CIL regulations) a person may assume liability to pay the levy.
(2) An assumption of liability—
(a) may be made before development commences, and
(b) must be made in accordance with any provision of CIL regulations about the procedure for assuming liability.
(3) A person who assumes liability for CIL before the commencement of development becomes liable when development is commenced in reliance on planning permission.”
21.	Section 209(1)(b) of the PA defines development as “anything done to or in respect of an existing building”.  It continues:
“(2) CIL Regulations may provide for –
(a) works or changes in use of a specified kind not to be treated as development
…
(3) CIL regulations must include provision for determining when development is treated as commencing.
(4) Regulations under subsection (3) may, in particular, provide for development to be treated as commencing when some specified activity or event is undertaken or occurs, where the activity or event—
(a) is not development within the meaning of subsection (1), but
(b) has a specified kind of connection with a development within the meaning of that subsection.
(5) CIL regulations must define planning permission (which may include planning permission within the meaning of TCPA 1990 and any other kind of permission or consent (however called, and whether general or specific)).”
22.	Regulation 6 of the CIL Regulations reads:
“6(1) The following works are not to be treated as development for the purposes of section 208 of PA 2008 (liability)—
…
(c) the carrying out of any work to, or in respect of, an existing building for which planning permission is required only because of provision made under section 55(2A) of the TCPA 1990;
…”
23.	Section 55(2)(a) and section 55(2A) of the Town and Country Planning Act 1990 (“TCPA”) provide:
“55(2) The following operations … shall not be taken for the purposes of this Act to involve development of the land—
(a) the … alteration of any building or works which—
(i) affect only the interior of the building,
…
…
(2A) The Secretary of State may in a development order specify any circumstances or description of circumstances in which subsection (2) does not apply to operations mentioned in paragraph (a) of that subsection which have the effect of increasing the gross floor space of the building by such amount or percentage amount as is so specified.”
24.	Article 44 of the Town and Country Planning (Development Management Procedure) (England) Order 2015 (“the DMPO”) provides:
“44(1) The amount specified under section 55(2A) of the 1990 Act (meaning of “development” and “new development”) is 200 square metres.
(2) The circumstances in which section 55(2) of the 1990 Act does not apply to operations mentioned in paragraph (a) of that subsection which have the effect of increasing the floor space of the building by more than 200 square metres are that the building is used for the retail sale of goods other than hot food.”
25.	Chargeable development is defined under regulation 9 of the CIL Regulations as “development for which planning permission is granted”.  
26.	Regulation 65 of the CIL Regulations provides:
“(1) The collecting authority must issue a liability notice as soon as practicable after the day on which a planning permission first permits development.” 
27.	The CIL Regulations were amended by the Community Infrastructure Levy (Amendment) Regulations 2011 (“the Amendment Regulations”).  Paragraphs 7.5 and 7.6 of the Explanatory Memorandum, which was laid before the House of Commons, to the Amendment Regulations read:
“7.5 Regulations 4(1) and 7 make clarificatory amendments to ensure the regulations deliver the policy intention that any development that affects only the interior of an existing building is not subject to a Community Infrastructure Levy charge.
7.6 The purpose of these amendments is to ensure equal treatment of any development to the interior of buildings.  It is already clear that most internal only development is not liable to the Community Infrastructure Levy, as it does not require planning permission (as defined by regulation 5 of the Community Infrastructure Levy Regulations 2010).”
Submissions
28.	Both grounds in the Statement of Facts and Grounds raise the same issue.  That is, did the defendant act lawfully in issuing the Liability Notice and Demand Notice to the claimant?  
29.	In summary, the claimant submits that the defendant had no lawful power to act as it did in issuing both notices as the mezzanine planning permission falls within the exemption created by regulation 6(1)(c) of the CIL Regulations and the external planning permission creates no floor space and so is not liable to CIL.  Each planning permission is independent of the other.  
30.	The defendant contends that both planning permissions should be treated as one.  The works were carried out together and affect the interior and exterior of unit C3/C4.  Had the works been the subject of a single planning application and planning permission granted that would have been subject to CIL.  
31.	The defendant submits that it was entitled to treat the two applications as a single development for the purposes of CIL.  It is evident from the witness statement of Mr Blatchford that the reality of the situation was that the claimant was pursuing a deliberate strategy to avoid CIL.  What there was here was one development that was divided into two planning applications.  Other factors relied upon the defendant as entitling it to act as it did were:
i)	The fact that both planning applications were submitted on the same day, namely 29 January 2015, and under a single cover letter;
ii)	The Planning and Retail Statement which accompanied the application referred to “a package of applications to meet the operational requirements of Next”;
iii)	The Next Operator Statement which referred to the collective impact of the development as follows, “The proposals to insert a new mezzanine floor and provide a new shop front at the Orbital store will result in a significant upgrading of the store and constitute an investment by Next of over £2.8m”;
iv)	Both applications were determined under delegated authority by the Head of Planning on 4 June 2015 and Decision Notices were issued on the same date, namely 5 June 2015.  
32.	The defendant submits that the claimant’s submission that each planning permission can be independently implemented is artificial as, in reality, the two applications are linked.  
33.	The witness statement of Sarah Screen, the defendant’s Planning Obligations Project Manager/CIL Manager, sets out her judgment that the two planning applications form a single development.  Paragraph 19 of her witness statement says:
“To implement the external alterations alone would not improve the visual appearance of the Unit or the wider Retail Park environment in any way.  Indeed, if the external works were implemented alone it would produce an unsightly and undesirable view of the store front, as it would expose the internal roof void, air conditioning ducts, the structures for the suspended ceiling and electrical cables.  Therefore the external works are dependent on internal alterations being undertaken to the building i.e. specifically the creation of an upper floor.  Accordingly, in reality, I regard it to be highly improbable that the external works would be implemented without the internal works also being undertaken.  This further supports my judgment that the two planning applications form a single development.”
34.	The defendant, in its Grounds of Resistance and in its written submissions, relied upon the law relating to Environmental Impact Assessment (“EIA”) cases.  In his oral submissions Mr Crean QC, for the defendant, said expressly that he no longer relied upon the EIA authorities. 
35.	Instead the defendant relied upon tax avoidance authorities to support its submission that the two applications were a single development.  In particular, the defendant placed reliance upon Barclays Mercantile Business Finance Limited v Mawson (HM Inspector of Taxes) [2005] 1 AC 684 at [36] and MacNiven (HM Inspector of Taxes) v Westmoreland Investments Limited [2003] 1 AC 311.  
36.	The defendant accepts that the mezzanine planning permission alone would not constitute chargeable development for the purposes of CIL.  Further, the defendant accepts that the regulations do not apply to the external works planning permission in itself.  
37.	However, the defendant contends that the purpose of the CIL regulations is to gather in taxation to cross-fund access to public infrastructure which is inimicable to permitting an interpretation that development can take place pursuant to a strategy designed to avoid the levy.  
38.	The defendant accepts that there is nothing in the strict language of regulation 6(1)(c) which makes it applicable to development outside section 55(2A) TCPA.  
39.	The defendant’s case is that the relevant legislation is to be construed purposively.  Here, Mr Crean submits that means:
i)	That the construction to be adopted is to give effect to the purpose of the statute;
ii)	In doing so the court must have an eye on the real world;
iii)	The court must understand the factual context in which the statute is to be construed;
iv)	It would be wrong to adopt an arbitrary distinction between commercial and legal realities: see Mawson at [38]).
40.	Mr Crean submitted that regulation 6(1)(c) was limited in its effect and scope and that the works at Swindon were to be divorced from the strict language of the regulation.  It was not the intention of the legislature to provide an exception such as is sought in the instant case.  What has happened here is an attempt to manipulate the system: see R (Burridge) v Breckland District Council [2013] EWCA Civ 228 at [72(iv)]).  
Discussion and Conclusions
41.	I deal first with the statutory scheme.  I have set out the legal framework above.  From that it is clear that a local authority is able to charge CIL in respect of development within its area: section 206 PA.  That power arises when development is commenced in reliance on a planning permission involving chargeable development: see section 208 PA. 
42.	The ability to charge CIL is a discretionary one on the part of a charging authority: see section 206.  
43.	The CIL Regulations can provide for works of a specified kind not to be treated as development.  
44.	That is what regulation 6 of the CIL Regulations is concerned with.  It sets out expressly in regulation 6(1) works which are not to be treated as development for the purposes of section 208 of the PA.  That includes under regulation 6(1)(c) work in respect of an existing building for which planning permission is required only because of section 55(2A) of the TCPA. 
45.	Section 55(2)(a) TCPA sets out uses of land or operations which are not to be taken to involve development. Section 55(2)(a)(i) states that works which affect only the interior of the building do not involve development.  Section 55(2A) TCPA empowers the Secretary of State by Development Order to specify or describe circumstances in which section 55(2) TCPA does not apply to operations set out in section 55(2)(a).  
46.	Article 44 of the DMPO provides that internal operations which increase the floor space of a building by more than 200 square metres, if that building is used for the retail sale of goods, is development which requires planning permission.  In other words, without article 44 of the DMPO a mezzanine floor inserted into a building for use for the retail sale of goods of more than 200 square metres would not require planning permission at all.  
47.	It follows from that that if the mezzanine floor planning permission is considered by itself it would not constitute development under regulation 6(1)(c) of the CIL Regulations.  Accordingly, it would not be chargeable development which is defined under regulation 9 as development for which planning permission is granted.  
48.	On the plain and ordinary meaning of the words used within regulation 6(1)(c), in my judgment, it is clear that CIL is not chargeable on the mezzanine planning permission.  
49.	The defendant’s submission is that that situation changes when, in reality, the mezzanine planning permission is part of a wider planning permission.  In argument Mr Crean could think of no other occasion in planning law when a single planning permission should be read together with another as if they were one planning permission.  Over the short adjournment he produced the case of Martin v David Wilson Homes Limited [2004] EWCA Civ 1027 which he submitted assisted with the point.  That case concerns a restrictive covenant within a conveyance.  It involved the interpretation of whether an indefinite article used in the phrase “a private dwelling house” contained within the covenant was to be construed as a limitation of number or whether it was construed as to being to the manner of use.  The clause in which the phrase arose was worded:
“(c) Not at any time to carry on or permit or suffer to be carried on the said land or any part thereof or in any building or buildings erected or to be erected thereon any trade or business whatsoever and not to use or permit or suffer any buildings erected thereon or on any part thereof to be used for any other purpose than as a private dwelling house either with or without garages and other necessary outbuildings.”
50.	Mr Crean relied upon [22] of the judgment in which Neuberger LJ (as he then was) said:
“I do not think that the expression ‘a’ does carry any necessary implication of singularity.  ‘A’ is an article, not a number. When, as here, one is concerned with how any particular building shall be used, a natural way of expressing that is ‘use as a private dwelling house.’”
51.	Thus Mr Crean submits although the wording of the regulations envisages one planning permission where “planning permission” is used it embraces more than one. 
52.	The case of Martin is entirely different to the circumstances before the court.  It was not dealing with a statutory scheme but with a covenant within a conveyance and it was dealing with the question of use of a dwelling house and the interpretation of a user clause, which bears little, if any, relationship to a planning permission.  It is no authority for the proposition that the defendant seeks to persuade the court to accept in this case.
53.	It is axiomatic that one interprets a planning permission within its four corners and on its face, save in certain limited exceptions which it is not suggested are applicable here.  There is nothing on the face of the mezzanine planning permission to link it with the planning permission for external operations.  Further, each permission will be entered separately upon the planning register which it is the duty of a local planning authority to maintain to enable there to be a comprehensive record of all planning permissions for public inspection.  Nothing on that public record would indicate that the two separate permissions should be seen as one.  
54.	There is, therefore, no basis in the statutory provisions or in planning law which supports the defendant in its arguments.  I deal with the defendant’s arguments on purposive interpretation and administrative discretion below. 
55.	The defendant contends that in the real world the development proposed was a single development which was subdivided as it was to avoid paying CIL.  CIL is intended to provide infrastructure to support the development of an area as opposed to making an individual planning application acceptable in planning terms.  Indeed, the overall purpose of the CIL liability “is to ensure that costs incurred in supporting the development of an area can be funded (wholly or partly) by owners or developers of land in a way that does not make development of the area economically unviable.”  
56.	Thus, the defendant submits that CIL supplements the existing scheme of planning obligations to capture more planning gain to finance additional investment and to ensure that land owners make a full contribution towards infrastructure costs.  If the claimant does not pay then it will fall to the defendant to provide that funding – meaning the local tax-paying public.  The defendant contends that outcome is contrary to the purpose of the CIL Regulations.  Accordingly, a purposive approach must be taken to statutory interpretation.  
57.	The claimant agrees that a purposive approach is to be taken to statutory interpretation but contends that the defendant needs to identify which statutory provision it is construing.  That it has not done.  In addition, the defendant has not identified any statutory provision to entitle it to exercise its discretion to treat two separate planning permissions as one.  The CIL Regulations rely upon a definition of chargeable development as “that for which planning permission is granted”.  Planning permission is defined under regulation 5 for the purposes of the regulations.  That states:
“5 (1) For the purposes of Part 11 of PA 2008, “planning permission” means—
(a) planning permission granted by a local planning authority under section 70, 73 or 73A of TCPA 1990;
…”
58.	Regulation 2 defines planning permission for the purposes of the regulations as “the meaning given for the purposes of Part 11 of PA 2008 in regulation 5, and ‘grant’ of planning permission must be construed accordingly”.  
59.	The statute, therefore, confers no discretion as to how a planning permission is to be interpreted: it mandates an interpretation in accordance with the definition in regulation 5.  There is nothing within regulation 5 which, in my judgment, permits the interpretation that the defendant urges.  Rather, the words used refer to planning permission granted by a local planning authority under sections 70, 73 or 73A TCPA.
60.	Under the CIL Regulations, as originally drafted, a problem arose when a new planning permission was granted under section 73 TCPA for development without compliance with conditions on a previous planning permission.  A consent under section 73 results in a new planning permission rather than a variation of the original planning permission.  However, such a consent would cause a problem in relation to CIL which would then become liable under the new planning permission granted under section 73.  The difficulty in those circumstances was that CIL would already have been paid under the original planning permission.  The CIL Amendment Regulations of 2012 were to clarify that uncertainty.  The amendment to regulation 9 read:
“(6) Where the effect of a planning permission granted under section 73 of TCPA 1990 is to change a condition subject to which a previous planning permission was granted so that the amount of CIL payable calculated under regulation 40 (as modified by paragraph (8)) would not change, the chargeable development is the development for which planning permission was granted by the previous permission as if that development was commenced.
(7) Where the effect of the planning permission granted under section 73 of TCPA 1990 is to change a condition subject to which a previous planning permission was granted so that the amount of CIL payable under regulation 40 (as modified by paragraph (8)) would change, the chargeable development is the most recently commenced or re-commenced chargeable development.
(8) For the purposes of paragraphs (6) and (7), the liability to CIL under regulation 40 should be calculated in relation to an application made under section 73 of TCPA 1990 as if the date on which the planning permission granted under that application first permits development was the same as that for the application for planning permission to which the application under section 73 of TCPA 1990 relates.
(9) For the purposes of paragraph (7), chargeable development is re-commenced where—
(a) the chargeable development (“the earlier development”) was commenced;
(b) work on the earlier development was halted and a different chargeable development (“the later development”) that was granted planning permission under section 73 of TCPA 1990 was commenced on the relevant land; and
(c) the later development was subsequently halted and the earlier development is continued.”
61.	The 2012 amendments, in my judgment, make it abundantly clear that CIL is to be paid once only and the basis upon which it is to be paid.  The amendments refer also to “a planning permission.” 
62.	In my judgment, the statutory intent of the CIL Regulations is to give certainty to developers and the local planning authority as to when and how the liability for CIL will arise.  There would be no need for the 2012 amendments if two separate planning permissions were or could be to be treated as one.  I accept the claimant’s submission to that effect.  
63.	The policy intention, in my judgment, is clear too.  The 2011 Amendment Regulations explanatory memorandum deals with the policy background in paragraphs 7.5 and 7.6 (see above).  Those paragraphs make it clear that the purpose of the amendments is to ensure that there is equal treatment of any development of the interior of buildings.  The reference to “most internal only” development reflects the wording of section 55(2)(a) TCPA which says development which affects only the interior of a building will not be development.  
64.	Regulation 6(1)(c) of the CIL Regulations is, therefore, putting internal floor space for retail development on the same footing as other internal retail floor space which does not require planning permission.  In my judgment, that is the equality of approach which is referred to in paragraph 7.6 of the explanatory memorandum to the Amendment Regulations.  
65.	The defendant submits that it is not the intention of the legislation to provide an exception for mezzanine floors under regulation 6(1)(c) and to facilitate a device such as was deployed here by the deliberate splitting of the mezzanine works from external works.  
66.	In my judgment there are significant flaws in that submission.  
67.	First, as is clear from the analysis of the statutory provisions there is nothing within them to prevent the splitting of operational works in the way that was done.  Indeed, to provide equal treatment of internal floor space the statutory scheme, as currently drafted, enables splitting to occur.  
68.	Second, the reality argument.  The evidence from Mr Blatchford is that each planning permission can be implemented separately.  Sarah Screen agrees that is possible but contends that it is unlikely.  But if planning permission for the mezzanine floor was implemented on, say 1 September, and completed that month but the planning permission for external works, for whatever reason, was not implemented until 3 March the following year it is difficult to see how the defendant’s arguments that it was all one development could begin to apply at all.  A Liability Notice has to be served as soon as practicable after the implementation of development which would be in September on the commencement of development of the mezzanine floor in the example given and a Demand Notice would follow.  There would be no argument there that liability would arise on the external works permission at all as no floor space was created.  The argument of the defendant would then fall away.  
69.	Third, not only would the defendant’s approach be contrary to the whole approach to the interpretation of planning permissions it would be contrary to constitutional principles.  As was said in Vestey v Inland Revenue Commissioners [1980] AC 1148 by Lord Wilberforce:
“Taxes are imposed upon subjects by Parliament.  A citizen cannot be taxed unless he is designated in clear terms by a taxing Act as a taxpayer and the amount of his liability is clearly defined.  
A proposition that whether a subject is to be taxed or not, or, if he is, the amount of his liability, is to be decided (even though within a limit) by an administrative body represents a radical departure from constitutional principle.  It may be that the revenue could persuade Parliament to enact such a proposition in such terms that the courts would have to give effect to it: but, unless it has done so, the courts, acting on constitutional principles not only should not, but cannot, validate it.”
The defendant’s submissions to the contrary fail against that wellknown proposition.  That is the complete answer to the defendant’s contention that it is for the local planning authority to exercise its administrative discretion and for it to form a judgment, which can only be challenged on Wednesbury grounds, as to how it deals with two separate planning permissions.  
70.	Fourth, the defendant contends that the submission of two separate planning permissions is a device to manipulate the system.  It relies upon Burridge on this point despite Mr Crean having expressly disclaimed, at the outset of his submissions, any reliance on authorities which involved the EIA legislative scheme.  In his judgment Davis LJ noted in [72(iv)] that “No one can suggest, or does suggest, that the interested party here was in any way trying to manipulate the system.”  Mr Crean relies upon those words as supporting his submission that when the system has been manipulated, as here, different considerations apply. 
71.	The context of the EIA cases is entirely different.  They are concerned with an EIA Directive, its underlying purpose and the likely significant effects of the development on the environment.  In Burridge the question arose as to what was the development in question for the purposes of regulation 7(1)(b) of the Town and Country Planning (Environmental Impact Assessment) (England and Wales) Regulations 1999.  The court agreed with the judge at first instance that the two applications were not only functionally independent but were to be regarded as part of the same substantial development.  But the issue there was of environmental effect.  No issue arose as to any liability to tax which is the issue here.  The case of Burridge and the EIA line of authorities relied upon in written submissions are clearly distinguishable on that basis.  
72.	The defendant contends that tax cases, too, need to take account of the commercial realities and the real world.  I agree with that submission.  The real world, as drafted in the regulations for CIL before the court, permits the claimant to act as it did.  
73.	There is, therefore, no manipulation of the system for any ulterior and/or illegal motive in accordance with the submissions of the defendant.  Rather, the claimant has taken advantage of the legislative scheme which permits it to submit, in this case, two separate planning applications for each act of operational development that it wished to pursue.  If it was not the intention of the legislature to permit that to occur then it is for the legislature to change it.  At present, in my judgment, that is the consequence of the current statutory scheme.  
74.	Despite pressing a purposive intention of the statutory provisions in general the defendant did not identify which particular provision entitled it to act as it did.  I have dealt with statutory intention above.  The cases of Mawson and MacNiven relied upon by the defendant make it clear that the question is always whether the relevant provision of the statute, upon its true construction, applies to the facts as found. As Lord Nicholls said in Mawson at [38]:
“38. MacNiven shows the need to focus carefully upon the particular statutory provision and to identify its requirements before one can decide whether circular payments or elements inserted for the purpose of tax avoidance should be disregarded or treated as irrelevant for the purposes of the statute.  In the speech of Lord Hoffmann in MacNiven it was said that if a statute laid down requirements by reference to some commercial concept such as gain or loss, it would usually follow that elements inserted into a composite transaction without any commercial purpose could be disregarded, whereas if the requirements of the statute were purely by reference to its legal nature (in MacNiven, the discharge of a debt) then an act having that legal effect would suffice, whatever its commercial purpose may have been.  This is not an unreasonable generalisation, indeed perhaps something of a truism, but we do not think that it was intended to provide a substitute for a close analysis of what the statute means.  It certainly does not justify the assumption that an answer can be obtained by classifying all concepts a priori as either ‘commercial’ or ‘legal’.  That would be the very negation of purposive construction: see Ribeiro PJ in Arrowtown at paras 37 and 39 and the perceptive judgment of the special commissioners (Theodore Wallace and Julian Ghosh) in Campbell v Inland Revenue Commissioners [2004] STC (SCD) 396. 
39. The present case, like MacNiven, illustrates the need for a close analysis of what, on a purposive construction, the statute actually requires.  …”
75.	The cases relied upon by the defendant underline the importance of a close and clear analysis of what the statute actually requires.  I have followed that approach above and it does not assist the defendant.  
76.	However, the question before the court is not whether it was lawful for the claimant to do what it did (which I have found to be perfectly lawful) but did the defendant act lawfully in demanding CIL under its Liability and Demand Notices by interpreting the two separate planning permissions as one?  
77.	For reasons that I have set out I find the defendant has acted unlawfully.  Accordingly, this claim succeeds and there will be judgment for the claimant.