Summary: Ms X complained about the County Council transferring money paid under a planning legal agreement to a third party to carry out works near her home. Ms X said the third party did not have the ability to carry out the works and its errors badly affected her residential amenities. The Ombudsman did not find fault by the County Council.

The complaint

1. Ms X says the County Council:

• did not properly deal with a third party’s application for money for a local scheme, which meant it did not identify and address the applicant’s lack of expertise to deliver such a scheme; and
• unfairly prioritised that same applicant’s late application to close, temporarily, a footpath.

2. Ms X says the scheme resulted in light nuisance, interfered with bats, and led to avoidable added costs. Ms X says the scheme works also caused inconvenience for walkers and personal injury. Ms X says she incurred time and trouble writing to both the third party applicant and the County Council.
3. Ms X wants an apology and councillors to review the County Council’s policy and procedure for awarding money, which should include how it will overcome problems if a scheme goes wrong.

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What I have investigated

4. I have investigated Ms X’s complaint about the third party’s application for money but not the complaint about the footpath closure. My reasons for not investigating the footpath closure are given in paragraphs 26 and 27 of this statement.

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The Ombudsman’s role and powers

5. We investigate complaints of injustice caused by ‘maladministration’ and ‘service failure’. I have used the word ‘fault’ to refer to these. We cannot question whether a council’s decision is right or wrong simply because the complainant disagrees with it. We must consider whether there was fault in the way the decision was reached. (Local Government Act 1974, section 34(3), as amended)
6. We cannot investigate late complaints unless we decide there are good reasons. Late complaints are when someone takes more than 12 months to complain to us about something a council has done. (Local Government Act 1974, sections 26B and 34D, as amended)
7. If we are satisfied with a council’s actions or proposed actions, we can complete our investigation and issue a decision statement. (Local Government Act 1974, section 30(1B) and 34H(i), as amended)

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How I considered this complaint

8. I have:

• considered Ms X’s written complaint and tried to speak to her on the telephone;
• considered the complaint correspondence between Ms X and the County Council;
• considered the County Council’s developer contributions policy and protocol for third party applications;
• considered planning information available on the relevant District Council’s website about the developments linked to Ms X’s complaint; and
• given Ms X and the County Council an opportunity to comment on a draft of this statement and considered their replies.

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What I found

Background

9. Many years ago, a District Council signed a section 106 agreement with landowners before granting them planning permission to develop their land. A section 106 agreement is a legal agreement between councils and landowners that links to a planning permission. The section 106 agreement included legal commitments about providing new facilities for local people outside the development site. The agreement also said the landowners had to pay several contributions to the District Council to fund improvements to its and County Council services. The County Council was not a party to the section 106 agreement.
10. Over the years, the section 106 agreement changed. A third party (‘the Applicant’) signed later agreements, which changed the detailed terms of the original agreement. (The County Council was not a party to the changes to the original agreement.) The section 106 agreement, as changed, said the landowners had to pay a contribution (‘Contribution One’) to the District Council. The District Council then had to pay Contribution One to the Applicant to provide a new facility (‘the Scheme’). The section 106 agreement dealt with the possibility the Scheme might cost more than Contribution One. The landowners agreed to the District Council using another of their contributions (‘Contribution Two’) so the Applicant had enough money to complete the Scheme.
11. The District Council’s arrangements for handling money paid by landowners to meet their legal obligations under section 106 agreements, meant the County Council held Contributions One and Two.
12. The Applicant applied to the District Council for planning permission for the Scheme. Ms X, and other residents, objected to the planning application. Ms X’s reasons for objecting included proposed lights causing pollution and nuisance, which might also affect bats and other wildlife. The District Council consulted the County Council, as the local highway authority, about the application. The County Council did not object and said the Scheme was unlikely to produce significant traffic. After assessing the application, taking account of representations, the District Council granted planning permission. Later, the District Council approved another application from the Applicant, which gave further details of the works, including a lighting plan for the Scheme.
13. Meanwhile, the Applicant contacted the County Council and provided information about the Scheme, including its cost, which was more than Contribution One. The County Council was satisfied the Applicant was employing suitably qualified professionals, and also with its tender procedures to select a contractor for the Scheme. The County Council checked the costs provided by the Applicant and found them valid and value for money. The County Council released Contribution One and Contribution Two to the Applicant.
14. The Applicant completed the Scheme, which opened for local people to use. Ms X and the Applicant started corresponding about the lighting of the Scheme. Ms X said the Scheme lights were so bright that lined curtains did not stop them shining into residents’ bedrooms windows creating a nuisance. Ms X’s position is the lights do not meet relevant British Standards for lighting, and changes the Applicant was willing to make were inadequate and would need more public money.
15. Ms X complained to the County Council. It was more than two years since the Applicant had applied for planning permission for the Scheme and about five months after the Scheme opened.
16. Ms X said she was complaining to the County Council because it had given the Applicant the money for the Scheme. Ms X said the County Council should have ensured the Applicant had the capacity and expertise to understand and assess relevant Scheme information and comply with the law. The County Council had failed to do this, and the Applicant had made serious errors managing and delivering the Scheme. These errors had wasted public money and created a light nuisance that badly affected peoples’ homes. Specifically, the County Council had failed to pick up on the Scheme’s lighting problems, including when commenting on the planning application. The County Council had also failed to ensure the Applicant carried out environmental impact and safety assessments. Ms X also said the County Council had quickly closed a local footpath for the Applicant although it had not given the necessary six to eight weeks’ notice. Ms X asked the County Council to put right the light nuisance and other problems.
17. In responding to the complaint, the County Council referred to its May 2016 Developer Contributions Policy (‘the Policy’). The Policy sets out the County Council’s approach to securing and using developer contributions. The thrust of the Policy concerns how the County Council will prioritise its own schemes, in line with corporate objectives, when using developer contributions. The Policy includes a few references to ‘third parties’ delivering County Council priority schemes. The Policy says a senior County Council officer (SRO) will ensure section 106 contributions are used in line with the relevant agreement.
18. In summary, the County Council’s position on Ms X’s complaint is:

• development contributions must be used as set out in the relevant section 106 agreement;
• here the agreement needed payment of Contribution One to the Applicant for the Scheme and, if necessary to complete the Scheme, Contribution Two;
• the County Council was responsible for paying Contributions One and Two in line with the agreement, and did this;
• the County Council complied with the Policy by checking the Applicant’s Scheme costs were valid and, later, that Contributions One and Two had been used for the Scheme;
• the County Council was not responsible for deciding whether the Scheme, including its lighting, had an acceptable impact as this was decision for the District Council as local planning authority;
• the County Council was consulted on the Scheme planning application as the local highway authority and properly commented on the road safety and capacity impacts of the development and not its design;
• the section 106 agreement made the Applicant responsible for the Scheme and it was not for the County Council to ensure the Applicant secured any necessary consents and permissions and complied with the law;
• the County Council was satisfied the Applicant had employed suitable professionals to deliver the Scheme and it was not reasonable to expect it to ensure such professionals gave correct advice;
• the County Council was not responsible for managing or overseeing the Scheme or checking it complied with the planning permission;
• the published timescales for applying for temporary footpath closures were not legal time limits but to help the County Council process applications; and
• it was reasonable for the County Council to process the Applicant’s late application as it concerned a community scheme and the closure was timed to avoid disruption for local people.

19. The County Council also said it had recognised the Policy referred to third parties using unallocated contributions received through section 106 agreements. It had therefore introduced a written protocol for such cases. The protocol expected third party applications for funding would be for schemes costing less than £20,000 that would benefit and be accessible to the public and free to use. (Contributions One and Two each significantly exceed the £20,000 limit.) The protocol set out the information a third-party would need to give the County Council. The protocol also set out the County Council’s approach to deciding which applications it would fund from unallocated contributions.
20. Ms X says the County Council has misinterpreted her complaint as she has never said it should actively manage the Scheme. Ms X says her complaint is about the failure of the County Council’s procedures for approving section 106 payments to third parties. Ms X says the County Council failed to get information from the Applicant to show it understood and knew how to meet all relevant laws and guidance. And the County Council’s informal approach meant the Applicant received money when it did not have the expertise to properly deliver the Scheme. Ms X says the County Council cannot excuse this failure by saying it has now introduced a protocol for payments to third parties.
21. Ms X also remains dissatisfied with the Council’s response about the temporary footpath closure. Ms X says the County Council’s website is clear about the need to give six to eight weeks’ notice when applying to close a path. Ms X says the County Council did not follow its published guidelines and gave preferential treatment to a project it was funding.

Consideration

22. I recognise Ms X strongly feels the County Council should have checked the Applicant’s ability to deliver the Scheme before paying Contributions One and Two. And yet, on the specific circumstances here, the County Council had a limited role. It was not a party to any of the section 106 agreements about Contributions One and Two. Those section 106 agreements were legally binding documents that included terms and conditions agreed by those that signed them. The County Council had no power to question or interfere with the terms and conditions of legally binding agreements completed by other parties.
23. Here, the County Council simply held money that legally had to be paid to the Applicant to provide the Scheme under the terms of the section 106 agreements. The section 106 agreements did not give the County Council the power to require the Applicant to show it was able to carry out the Scheme. Nor did the section 106 agreements give the County Council any power to withhold Contributions One and Two if it was not satisfied the Applicant was capable of delivering the Scheme. In deciding the Scheme costs were valid and value for money and, later, that the money was used to deliver the Scheme, the County Council acted correctly and proportionately given its limited role in dealing with Contributions One and Two. So, I find no fault in the County Council’s actions.
24. In reaching my view, I have taken account of the protocol now introduced by the County Council. As I understand the protocol, it concerns applications from third parties to use unallocated section 106 money. That was not the situation faced by the County Council in responding to the Applicant asking for payment of Contributions One and Two. Contributions One and Two were, under the section 106 agreements, made by the landowners to deliver the Scheme. And, unlike the County Council which was not a party to either the original or varied section 106 agreements, the Applicant was a party to the later agreements.

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Final decision

25. I completed my investigation finding no fault by the County Council.

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Parts of the complaint that I did not investigate

26. I have not investigated that part of Ms X’s complaint about the temporary closure of a footpath. The footpath was closed over eighteen months before Ms X complained to the Ombudsman. The evidence before me shows Ms X contacted the County Council about the intended closure, which led the County Council to contact the Applicant and trigger the ‘late’ application. A complaint about closing the path is therefore a late complaint (see paragraph 6).
27. I have considered if I should use my discretion to investigate the late complaint. And yet, I find no good reason to do so. It was for the County Council to decide if it would prioritise the Applicant’s late application. It chose to do so and, in responding to her complaint, explained its reasons to Ms X (see final bullet point to paragraph 18). The reasons given by the County Council are sound and relevant. I do not find that further investigation by the Ombudsman will add to the responses already provided by the County Council to Ms X. The footpath had also reopened some months before Ms X complained to the County Council and so I do not consider further investigation now could reasonably achieve any meaningful outcome for Ms X.

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Investigator's decision on behalf of the Ombudsman