Supreme Court rules in favour of resident over sale of land subject to statutory trust

The UK Supreme Court ruled in favour of a resident on 1 March in Day,R (on the application of) v Shropshire Council [2023] UKSC 8, who claimed that a statutory trust created in 1926 gives residents rights of recreation over a piece of land, which had already been sold to a developer by Shrewsbury Town Council. The planning permission granted by the Council has now been revoked following the Supreme Court’s ruling.

The piece of land in Shrewsbury at the centre of the case was part of a plot protected for public recreation by a statutory trust in 1926, but which was sold to a property developer in 2017 by the Council without the public being consulted.

The Supreme Court’s ruling finds that the people of Shrewsbury have rights over the land, which exist even though the land had been sold and that those rights protected by a statutory trust should have been considered by the Council before planning permission for a housing development was granted.

More specifically, the Supreme Court ruled that Section 128(2)(b) of the Local Government Act 1972 is not designed to free land from public trusts when that land is sold and should not be read as having accidentally done so; and that the public recreation rights over the recreation ground were material considerations that needed to be taken into account when it came to granting planning permission for a housing development.

A report issued to Shrewsbury Town Council by an independent auditor before the Supreme Court’s decision was issued, and which was quoted during the case, expressed the view that there had been serious governance failures in the sale of the land: “It is our view that [Shrewsbury Town Council] must put robust procedures in place to ensure that an oversight such as this is not permitted to recur. Where there should be any future sale of land [Shrewsbury Town Council] must be able to demonstrate that [it] has taken sufficient steps to establish the legal status of that land and act in accordance with all relevant legislation prior to sale. [Shrewsbury Town Council] should consider whether it has the legal power to proceed with any future disposals and, for the sake of good governance, should formally document the powers on which it has relied when making any such decisions.”