Unilateral undertaking or section 106 agreement

A unilateral undertaking and a section 106 agreement are the same legal creature under section 106 of the Town and Country Planning Act 1990. The difference is who signs. An agreement is a deed between the landowner and the council, with obligations capable of running both ways. A unilateral undertaking is a deed given by the landowner alone, promising something to the council, which does not sign it and gives nothing back.

For a small scheme that difference decides the programme. A unilateral undertaking can be completed without waiting for the council's legal team to be free, which on a busy authority is often the longest single delay between a resolution to grant and a decision notice.

What a planning obligation does

A planning obligation binds land rather than a person. It is registered as a local land charge, it runs with the land, and it is enforceable by the local planning authority against whoever owns the land at the time, including a purchaser who knew nothing about the negotiation.

Obligations do work that conditions cannot. A condition can restrict what happens on the application site. An obligation can require a payment, secure land off site, restrict occupation to a defined class of person, or commit to a management regime lasting decades.

Regulation 122 of the Community Infrastructure Levy Regulations 2010 sets the tests. An obligation may only be a reason for granting permission where it is necessary to make the development acceptable in planning terms, directly related to the development, and fairly and reasonably related in scale and kind to it. Those tests are legal requirements, not guidance, and an obligation that fails them cannot be taken into account.

Set out in the Planning Statement why each obligation offered meets those three tests. Officers appreciate it and inspectors expect it.

When a unilateral undertaking is enough

The deciding question is whether the council needs to promise anything.

Appeals are the classic unilateral undertaking case. An appellant cannot compel a council to enter into an agreement while the two are in dispute, so the undertaking is executed and submitted with the appeal, and the inspector can grant permission relying on it. Submit it early enough in the appeal timetable for the council to comment, and expect the inspector to test whether it meets the regulation 122 tests.

The limitation to remember is that an undertaking is one-sided. If you want the council to covenant to spend the money on a specified project, or to return it if unspent within five years, that is a promise by the council and it needs an agreement.

Parties, mortgagees and title

Everyone with a legal interest in the land should be a party, and this is where undertakings most often go wrong.

Start with an official copy of the register and the title plan. Identify the freeholder, any leaseholders, any registered charge, and any restriction on the register. Where the land is unregistered, deduce title from the deeds and expect the council's solicitor to want first registration or a satisfactory epitome.

Mortgagees matter more than people expect. A lender with a charge over the land that is not bound by the obligation may be able to sell free of it on enforcement, which defeats the whole arrangement. Councils therefore normally require the lender to join in the deed or to consent to it, and lender consent takes time, so start the request early.

Options, overage agreements and rights of way held by third parties all complicate the picture. So does land in joint names where one owner is abroad. None of this is difficult, but all of it takes weeks rather than days.

Council legal fees and timescales

Councils charge for the legal work, and the charge is usually payable whether or not the deed completes. Most authorities ask for an undertaking to pay their costs before the solicitor picks the file up, and some ask for a payment on account.

Timescales vary widely between authorities and there is no national standard. Two habits shorten them. Ask for the council's requirements in writing at the point the case officer indicates an obligation will be needed, rather than after committee. And produce a first draft yourself using the council's own template, so the authority's solicitor is reviewing rather than drafting.

The 13 week determination period for a major application does not pause while a deed is negotiated, which is why extensions of time are so routine on schemes involving obligations. Agree the extension in writing rather than letting the application run past the deadline unaddressed.

Drafting to the council's template

Almost every authority publishes a model agreement or a model unilateral undertaking. Use it. Departing from the template invites a line-by-line review and adds weeks.

Whatever the form, check five things before execution:

1. The recitals correctly describe the application, the site and the interests of each party.
2. The trigger points are defined precisely, since "prior to occupation" and "prior to first occupation of the tenth dwelling" behave very differently on a phased scheme.
3. Index linking is stated with a named index and a base date, because unindexed contributions lose value and indexed ones need a clear formula.
4. The definition of the development matches the application description word for word.
5. There is a mechanism to release the obligation if the permission is never implemented, so the charge does not sit on the title forever.

That last point matters on residential sites. A planning obligation left on the register after a permission has expired is a discoverable problem on sale, and cleaning it up later is slower than drafting it correctly now.

Where the obligation secures affordable housing, the drafting has to match the Affordable Housing Statement submitted with the application, including tenure mix, unit types and the transfer arrangements. Where it secures off-site biodiversity units, it has to sit consistently with the Biodiversity Net Gain Assessment and with the 30-year management requirement under the Environment Act 2021 regime.

Varying or discharging an obligation later

Obligations are not permanent in the way people assume.

Section 106A allows an obligation to be modified or discharged at any time by agreement between the authority and the person against whom it is enforceable. That is the quick route where both sides accept the change, and it needs a deed of variation.

Where the council will not agree, an application can be made to the authority to modify or discharge the obligation once five years have elapsed from the date it was entered into, on the ground that it no longer serves a useful purpose or would continue to serve its purpose equally well in a modified form. A refusal carries a right of appeal under section 106B.

Five years is a long time on a stalled site, which is an argument for getting the drafting right at the outset rather than relying on a future variation. Where viability is uncertain, a review mechanism written into the original deed is a better answer than an unaffordable obligation and an application to vary it later.

Browse the 66 report types by category to identify the supporting documents your obligations will have to match before the deed is drafted.

This is general guidance, not legal advice. Check the position with your local planning authority or a qualified professional before relying on it. PlanScope provides AI-assisted draft reports for planning applications. Reports should be reviewed before submission. We do not guarantee planning approval.