Some might say that the community infrastructure levy (“CIL”) is just a tax on developers to fund infrastructure, but a recent appeal case showed that it’s also a handy yardstick with which to measure human ingenuity…

In an attempt to get out of paying CIL on a scheme in Northamptonshire, a developer argued that its development was unlawful because a pre-commencement condition hadn’t been complied with.  The developer’s case was that CIL wasn’t payable because lawful development hadn’t yet commenced.

This argument received short shrift from the Secretary of State’s decision officer (who had presided over a previous appeal brought by the same developer along similar lines). The decision officer concluded that CIL isn’t concerned with whether or not a development is lawful, just with whether the development has started – or as the CIL Regulations put it, when a “material operation begins to be carried out”.

The CIL Regulations include a list of exclusions– but unlawful development isn’t one of them.  Somewhat surprisingly (for the developer at least), the definition of development doesn’t require the material operation to be carried out in accordance with a planning permission.  A material operation is a material operation whether or not the works involved have planning permission.

This meant that the developer’s case failed and the appeal was dismissed.  The lesson here?  It is possible to be a little too cunning – CIL doesn’t care whether or not your development is lawful –  if it’s liable for CIL, you’ll need to cough up.