Do section 106 obligations carry over to a section 73 permission
A section 73 grant is a new permission, and an older section 106 agreement often fails to bind it. Read the definitions clause, then budget for the supplemental deed that follows.
A section 73 permission is a new planning permission, and a section 106 agreement attached to the earlier one may not bind it. Whether it does turns on how the agreement defines the permission and the development, which is a drafting question rather than a planning one. On older agreements the answer is frequently no, and the council will not issue the section 73 decision until a supplemental deed is completed.
Budget time for that deed. On a scheme where the planning application takes eight weeks, the legal work routinely takes longer.
Why a section 73 grant is a new permission
Section 73 of the Town and Country Planning Act 1990 allows an application to develop land without complying with a condition on an earlier permission. If the authority agrees, it grants permission subject to different conditions, and that grant is a permission in its own right. The original permission continues to exist alongside it.
Everything downstream follows from that fact. Two permissions, each with its own reference, its own conditions, its own approved drawings and its own relationship to any obligation.
Whether the original obligation binds it
A planning obligation under section 106 is a covenant that runs with the land and binds successors in title. That part is not in doubt. The question is what the covenant actually requires and when.
Operative covenants are almost always triggered by defined events: implementation of the Permission, first occupation of a Dwelling, completion of a stated number of units under the Permission. If Permission is defined as a specific decision notice reference, and you implement a different permission, the trigger never occurs. The obligation still runs with the land. It simply has nothing to bite on.
That is the mechanism councils worry about, and it is why the modern practice is to define the permission to include any permission granted under section 73 varying it. Read the agreement before you assume either way.
Reading the definition of the permission
Go to the definitions clause and work through four things.
- How Permission is defined. A bare reference to an application number and a decision date is the version that causes the problem. Wording that extends to any permission granted under section 73 in respect of the Development solves it.
- How Development is defined. Sometimes the covenants attach to the development described rather than to the permission, which can carry across where the description is unchanged.
- Whether there is a general clause applying the agreement to any subsequent permission for the same development. Some agreements have one buried in the interpretation provisions.
- Whether any obligation has already been performed or triggered. A contribution paid under the original permission does not become payable twice, but the agreement has to say so, and a supplemental deed is the place to record it.
Where the answer is ambiguous, treat it as not binding and plan for a deed. Councils reach the same conclusion and will not take the risk.
Supplemental deeds and how they are drafted
A supplemental deed recites the original agreement, identifies the section 73 application, and provides that the new permission is to be treated as the Permission for the purposes of the original agreement, with any consequential amendments.
The parties matter as much as the wording. Everyone with an interest in the land has to be a party for the obligation to bind their interest, which means the freeholder, any leaseholder with a relevant interest, and any mortgagee. Getting a lender's consent from a securitised loan book is the step that takes months, and it should be started on the day the section 73 application is submitted rather than when the officer asks.
| Route | When it fits | Watch for |
|---|---|---|
| Supplemental deed treating the new permission as the Permission | Most section 73 variations where the obligations are unchanged | Mortgagee consent, and any obligation already performed |
| Deed of variation under section 106A | Where the obligations themselves need to change | Whether the council will agree, and the effect on affordable housing tenure |
| New agreement | Where the scheme has changed substantially | Longer timetable, and the original agreement needs releasing or leaving dormant |
| Nothing | Only where the agreement expressly binds section 73 permissions | Read the definitions clause yourself rather than relying on the file note |
Section 106A allows obligations to be modified or discharged by agreement at any time, and by application after five years have elapsed. The agreement route is the practical one, since the application route is slow and the outcome uncertain.
Implementing the wrong permission
Once two permissions exist, the development is carried out under one of them. You cannot build the drawings from one and rely on the conditions of the other.
Keep the records straight. Every discharge of conditions application, every notice, every certificate should reference the permission you are actually building. Site teams working from a folder assembled during the original permission are the usual source of the problem, and it surfaces at the worst moment, when a purchaser's solicitor asks for the condition compliance pack.
Illustrative example: a scheme of 34 dwellings varied its approved plans condition under section 73 after the ground floor layouts changed. A supplemental deed was completed. The contractor served the levy notice against the original reference and discharged four conditions against it as well. At plot sales, the solicitor raised enquiries on the mismatch, and the remedy was a set of confirmatory applications and a certificate from the authority that took eleven weeks.
The levy consequences
Community Infrastructure Levy liability is recalculated on a section 73 permission, with credit given for the chargeable amount under the earlier permission. Where the variation adds floorspace, expect a further charge; where it reduces floorspace, the credit mechanism limits what comes back.
The administrative steps repeat. A fresh assumption of liability notice and a fresh notice before work begins have to be served against the permission being implemented. Relief and exemption claims, including self build and social housing relief, do not carry across automatically and have to be claimed again, before work starts, or they are lost. That last point catches out more schemes than any other item here. The wider position on the levy regime and what has actually been brought into force is set out in infrastructure levy: what is enacted and what is not.
Checks before you submit
Five things, in this order, before the section 73 application goes in.
Read the definitions clause of the agreement and form a view on whether it binds a section 73 permission. Identify every party whose consent a supplemental deed will need, and start the mortgagee consent process. List the obligations already performed and the ones still outstanding. Check the levy position, including any relief already claimed. And ask the council's legal team, in writing, what form of deed they will require, because their standard form will govern the timetable whatever you propose.
Where affordable housing is one of the obligations, tenure and the threshold position are worth re-checking at the same time, since policy may have moved since the original agreement, and the Affordable Housing Statement supporting the variation should reflect the current position. Review mechanisms in the original deed also need carrying forward deliberately, as set out in overage clauses and review mechanisms in a section 106.
This is general guidance, not legal advice; check the position with your solicitor or a qualified professional before relying on it.
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Frequently asked questions
Does a section 106 agreement automatically apply to a section 73 permission?
Not automatically. The obligation runs with the land, but its operative covenants are usually triggered by defined events referring to a specific permission. If that definition names only the original decision notice, implementing a section 73 permission never triggers them. Modern agreements extend the definition to permissions granted under section 73.
What is a supplemental deed?
A short deed reciting the original agreement, identifying the section 73 application, and providing that the new permission is to be treated as the Permission for the purposes of the original obligations, with any consequential amendments. Every party with an interest in the land, including any mortgagee, has to be a party for it to bind their interest.
How long does the legal work take?
Usually longer than the planning application. Mortgagee consent is the slow step, particularly where the loan sits in a securitised book, and it should be started on the day the section 73 application is submitted. Ask the council's legal team in writing what form of deed they require, because their standard form governs the timetable.
Do levy reliefs carry across to the new permission?
No. Liability is recalculated on the section 73 permission with credit for the earlier chargeable amount, and the administrative steps repeat. A fresh assumption of liability notice and a fresh notice before work begins are needed, and any relief or exemption, including self build and social housing relief, has to be claimed again before work starts.
Can I mix conditions from the two permissions?
No. The development is carried out under one permission, with that permission's conditions and approved drawings. Discharge applications, notices and certificates should all reference the permission being built. Records assembled under the original permission are the usual source of mismatches, and they surface when a purchaser's solicitor asks for the compliance pack.
Sources and further reading
This article is general guidance about the planning system in England and, where stated, the rest of the UK. It is not legal or professional advice. Check your local planning authority’s validation requirements and take professional advice for your specific site.