AC-2024-CDF-000147 - [2025] EWHC 2395 (Admin)

The Decision was preceded by a lengthy period of consideration and by detailed consultation.

A high proportion of the dwelling houses in Gwynedd are used for commercial holiday letting or as second homes. The research paper considered by the Cabinet in December 2020 “Managing the use of dwellings as holiday homes” explained that in the summer of 2020 10.76% of Gwynedd’s housing stock consisted of such properties compared to a figure of 2.56% for Wales as a whole. The effect of the high proportion of holiday lettings and second homes in Gwynedd was to reduce the proportion of the housing stock available for full time occupation by those living permanently in the County. It also had an impact on property prices and, accordingly, on the affordability of accommodation. The paper justifying the introduction of the article 4 direction to the Cabinet in July 2024 described this as “a real threat to the social, cultural and economic prosperity of communities across Gwynedd”. In the context of Gwynedd there was particular concern that the presence of a high proportion of holiday lettings and second homes ran counter to the important objective of protecting and maintaining Welsh-speaking communities. The ability of property owners to change the use of dwellings from primary residences to holiday lettings and second homes without planning permission meant that the Defendant had no control over such changes and, accordingly, no control over the effect of such changes on the housing stock.

The research paper considered in December 2020 addressed the difficulties which the use of dwellings as holiday homes could cause and considered potential ways in which the problem could be addressed. At [3.2] and following the paper gave a detailed explanation of the operation of section 55 of the TCPA and the operation of the UCO. The paper explained in terms that it was only when a change of use was material that planning permission was required. It explained in some detail, by reference to the decision in Moore and to the decisions of planning inspectors applying the approach which the Court of Appeal had set out there, that the question of whether the change of use from a dwelling house to a commercial holiday letting was a material change of use was a matter of fact and degree to be determined by reference to the circumstances of the particular case. The paper also explained some of the difficulties and delays which can be involved in taking enforcement action in respect of breaches of planning control. The paper considered the position in respect of properties in multiple occupation and the scope for levying increased council tax on second homes. The paper culminated in a series of recommendations. One of these was that a separate use class be created for short-term holiday accommodation. It was said, at [10.16], that this would be “a means of overcoming any doubt as to when a change of use has occurred” and that “by having a specific use class for holiday accommodation planning permission would have to be granted for the use”. Although the authors of the paper had set out an accurate summary of some of the applicable principles of Planning Law they appear to have assumed that a change of use from one class to another would necessarily require planning permission. The correct position is that such a change does not amount to development and so does not require planning permission unless it is a material change (see [8] above).

The UCO and the GPDO were amended in 2022 as set out above. The amendments came into effect in October 2022 and in the same month a report was presented to the Defendant’s Communities Scrutiny Committee. The purpose of the report was to inform that committee of the changes which had come into effect the same month and, in particular, the provision for the making of an article 4 direction. The report explained, at [3.6], that the making of such a direction would remove the right to change between use classes without planning permission. It emphasized that an article 4 direction would not prevent development but would mean that planning permission would have to be sought for development.

The Communities Scrutiny Committee considered the matter again in March 2023 at which stage the making of an article 4 direction was described as being “the favoured option”. At [2.1] the report to that committee said that the making of an article 4 direction “would mean that planning consent would be required to use [a] residential dwelling as a second home/holiday accommodation in the future”. At [3.3.1] the report addressed the scope of the proposed article 4 direction. The tenor of the explanation given there was that any change of use from class C3 to class C5 or C6 would require planning permission and there was no indication that this would only be the case in respect of material changes of use.

On 13^th June 2023 the Cabinet approved the making of the article 4 direction with deferred effect. The decision at that stage was that the direction would come into effect on 1^st September 2024 subject to being confirmed. The public notice of that decision stated that certain permitted development rights were being removed and that development to which such rights had attached would require planning permission after the coming into force of the direction.

The public notice was accompanied by a letter sent by the Defendant to local residents. Under the heading “how does this affect you?” the letter said:

“If the Article 4 Direction is confirmed, and you own a residential dwelling (which is a main home) within the Gwynedd Local Planning Authority Area and wish to change the use to a second home, short term holiday let or specific mixed use, you will be required to obtain planning permission from Cyngor Gwynedd Local Planning Authority before undertaking the change of use.” (original emphasis)

In her evidence Heledd Fflur Jones, a planning policy team leader for the Defendant, said that council members were “familiar with the planning policy framework”. To substantiate this the officer referred to a session to raise awareness which had been held for local members after the Cabinet decision of June 2023 to give initial notice of the article 4 direction and also to a question and answer session held for the members of the Cabinet and of the Communities Scrutiny Committee in May 2024. She said that a question was asked as to how planning applications would be dealt with in light of the article 4 direction. Miss Jones said that the answer referred to the Local Development Plan and the Supplementary Planning Guidance. No further detail is given in the witness statement and there is no indication that it was explained in this session that changes between classes C3 and C5 and C6 which did not amount to material changes of use would not require planning permission even after the making of the article 4 direction.

There was a period of public engagement after the June 2023 decision and the results of that were reported to the Cabinet as I will describe below.

The matter then came before the Communities Scrutiny Committee on 16^th May 2024. The report to that committee said that it was “hoped that introducing the Article 4 Direction will provide an opportunity to assess the propriety of any proposal that involves changing the use of a residential home to holiday use, be that use as a holiday let or a second home.” The Communities Scrutiny Committee recommended that the Cabinet confirm the direction and the matter went back to the Cabinet.

The Cabinet considered the issue on 16^th July 2024. The Officers’ Report was accompanied by a report on the public engagement exercise; an impact assessment; and a “paper justifying the introduction of the Article 4 Direction.”

The following parts of the Officers’ Report are of note:

The report on the public engagement exercise was divided into thirty-seven “themes”. Each of these addressed a topic which had been raised in the engagement exercise and provided a summary of the comments which had been made together with the Defendant’s response to the comments. The following are of note for current purposes:

At [1.13] the paper justifying the introduction of the Article 4 Direction emphasized that the effect of such a direction was not to prevent development but to require planning permission to be obtained. That comment had been preceded by reference to the 2022 amendments to the GPDO and to the UCO saying that the amendments:

“…mean that it is possible to change from the use classes referred to above without restriction, that is without having to receive planning permission. For example, it is not be necessary to receive planning permission to change from being a dwelling house (main home) to being a dwelling house (secondary home) and vice versa.”

At [1.2] the impact assessment explained that the intention was to remove permitted development rights and said that this meant that after the implementation of the direction:

“… there will be a need to obtain planning permission to change the use of a residential home that is a main residence (C3 use) to a second home (C5 use) or holiday accommodation (C6 use).”