After Planning Permission has been granted, there is a period (“Judicial Review Period”), during which the planning can be challenged. Typically, the period allowed is six weeks although this can be longer in certain circumstances.
The usual grounds for a successful challenge under Judicial Review (“JR”) result from a view that proper procedures have not been followed during the planning process. In the event that they are successful this can result in the Planning Permission being quashed subsequently, causing substantial losses to the developer by way of abortive costs, contractual penalties and an overall loss in the market value of the land.
Even where not ultimately successful, the launch of a JR can cause serious delays to the start of the development and incur the developer substantial costs (“Delay Costs”).
How does Judicial Review Insurance help?
As there is a risk of the granted planning permission being over-turned, developers tend to wait for the six-week period to lapse before starting the development. Judicial Review insurance can be used as a “tool”, enabling developers to start development on the Planning Permission being granted, with the assurance that in the event that a Judicial Review is launched they would be covered for financial losses caused as a result of it.
These would include inter-alia:
- Loss in the market value of the land
- Contractual penalties and Standing Orders relating to the development
- Legal fees relating to the Judicial Review
- Delay of construction works
In what circumstances is cover required?
Where planning consent has been granted and a developer is concerned that a challenge may be raised. We suggest that these policies are taken out on the day that the planning decision has been issued, as this is when the risk starts.
Risks covered: Losses arising from delays in development, the overturning of the original planning consent and the costs of an alternative planning application.