Discharging a section 106 obligation that no longer serves

A planning obligation does not fall away because the reason for it has gone. It binds the land until it is discharged, and the entry stays on the local land charges register until someone applies to remove it. If a section 106 agreement on your site requires a contribution towards a facility that was built elsewhere, or a restriction tied to a permission that was never implemented, the route out is section 106A of the Town and Country Planning Act 1990.

There are two ways to use it. Agreement with the authority at any time, which is faster and is how most of these are resolved. Or a formal application after the relevant period has passed, which gives you a determination and, if refused, an appeal.

Obligations that have expired by their own terms

Read the deed before you do anything else. A well-drafted agreement usually contains its own exit provisions, and a surprising number of live obligations are already spent on their own wording.

Look for a clause providing that the agreement ceases to have effect if the permission expires without being implemented, or if the permission is quashed, revoked or superseded by a later consent. Look for definitions tied to occupation or to a trigger event that has not happened and cannot now happen. Look for time limits on the payment of a contribution and for repayment clauses where money has been held unspent beyond a stated period.

Where a clause of that kind applies, you do not need a section 106A application at all. You need a letter to the authority setting out the clause, the facts, and a request that the land charge entry be cancelled. Send it with the evidence attached rather than as an assertion.

One caution. A later permission on the same land does not automatically supersede an earlier agreement. Whether it does depends on the wording of both, and plenty of sites carry obligations from a permission nobody ever built.

Obligations that have been performed

Performance is a different argument from obsolescence. The obligation served its purpose, the money was paid or the works were done, and what remains is an administrative tidy-up.

The evidence pack is short: the deed, the clause, proof of payment or practical completion, and any certificate the agreement required the authority to issue. Many deeds contain a clause requiring the council to confirm compliance on request, and that confirmation is what the buyer's solicitor will want to see.

Where several obligations sit in one agreement and only some have been performed, ask for a written confirmation of compliance for those, and deal with the remainder separately. Trying to close out a whole agreement in one letter tends to stall on the one clause nobody can evidence.

Affordable housing clauses are the usual sticking point, because the obligation often continues in perpetuity through a mortgagee protection clause and nomination rights. Those are not spent when the units are sold, and a purchaser's solicitor will say so. Where the dispute is really about tenure mix rather than compliance, a variation supported by a Viability Assessment and a revised Affordable Housing Statement is usually the better route, and it is worth understanding how review mechanisms in a section 106 operate before you open that negotiation.

The section 106A route after five years

Section 106A(1) allows an obligation to be modified or discharged by agreement between the authority and the person against whom it is enforceable, at any time and in whatever terms they settle on. That is the common route, and it is documented by a deed of variation or a deed of release.

The formal application route becomes available after the relevant period, which section 106A(4) sets at five years beginning with the date the obligation was entered into, unless a different period is prescribed. The application is made to the authority under the Town and Country Planning (Modification and Discharge of Planning Obligations) Regulations 1992, in the prescribed form, and the authority must determine it within the period those regulations set.

The statutory test is narrow and worth quoting to yourself before you write anything. The authority must discharge the obligation if it no longer serves a useful purpose. It must modify the obligation if it continues to serve a useful purpose but would serve that purpose equally well if modified as proposed. Otherwise it must leave the obligation unchanged.

Note what the test does not say. It says nothing about viability, nothing about changed market conditions, and nothing about whether the obligation is now burdensome. Those arguments belong in a negotiated variation, not in a section 106A application.

Evidence that the obligation is obsolete

Useful purpose is judged against the planning purpose the obligation was designed to achieve. So the evidence has to show what that purpose was and why it can no longer be served.

The strongest cases fall into recognisable patterns. The infrastructure the contribution was earmarked for has been delivered by another route or abandoned. The facility the restriction protected no longer exists. The policy that justified the obligation has been replaced and the current development plan contains nothing equivalent. The scheme has been superseded by a different permission that carries its own obligations covering the same ground. The unit type the obligation restricted no longer exists after an approved alteration.

Assemble the record: the original committee report or officer delegated report explaining why the obligation was sought, the heads of terms, the current adopted policy, and whatever shows the changed position. Where a contribution remains unspent, ask the authority for its infrastructure funding statement entry for that sum, because a contribution held for years without a project attached is hard to defend as still serving a useful purpose.

The tests in regulation 122 of the Community Infrastructure Levy Regulations 2010, that an obligation must be necessary to make the development acceptable, directly related to it, and fairly and reasonably related in scale and kind, apply when permission is granted rather than at discharge. They still help, because an obligation that would fail those tests today is usually one the authority struggles to defend as useful now.

Dealing with the local land charge entry

A planning obligation is a local land charge. Discharging the obligation and clearing the register entry are separate steps, and the second one is the step that gets forgotten until a sale falls behind.

Once the deed of release or the determination is in hand, apply to the registering authority to cancel or amend the entry, enclosing the instrument. Where the authority's register has migrated to the central local land charges register held by HM Land Registry, the district council remains the originating authority and still handles the amendment.

Check the title as well. Some agreements are protected by a restriction or a notice on the registered title, and removing that requires a separate application to HM Land Registry with the release deed. A buyer's solicitor will find whichever one you left behind.

Where the authority refuses

Councils refuse for three reasons in practice: they disagree that the purpose has gone, they hold money they would have to return, or the officer with the file has left and nobody wants to take the decision.

Deal with the first on evidence and the second on the deed's own repayment clause. The third responds to persistence and to a clear, short application that does the officer's work for them. A one-page schedule setting out each clause, its status, the evidence reference and the relief sought is worth more than a long letter.

If the authority proposes modification rather than discharge, look hard at the modification offered. An obligation that survives in a narrower form is often a better commercial outcome than an appeal, and it can be completed in weeks.

Appealing a refusal to discharge

An appeal lies to the Secretary of State under section 106B against a refusal to discharge or modify, or against a failure to determine within the statutory period. The deadline is set by the 1992 Regulations, so check it against the determination notice rather than assuming, and diarise it the day the notice arrives.

Appeals are normally handled by written representations, and the inspector applies the same statutory test the authority had to apply. That is the point people miss. The appeal is not a rehearing of whether the obligation is fair. It asks whether the obligation still serves a useful purpose, and if it does, whether the proposed modification would serve that purpose equally well.

Keep the appeal documents tight: the deed, the clause, the purpose evidence, the authority's decision, and a short statement applying the test to the facts. Anything about viability or market conditions will be read and set aside.

Enter your postcode on PlanScope to see which reports a variation application is likely to need. PlanScope provides AI-assisted draft reports for planning applications. Reports should be reviewed before submission. We do not guarantee planning approval. This is general guidance rather than legal advice, and the wording of a specific agreement should be checked by a solicitor before you act on it.