DEVELOPERS behind the 1,200-home Winnington Urban Village have lost a legal battle to fork out less money towards infrastructure.

Housebuilders working on the project took Cheshire West and Chester Council to the High Court last year to clear up whether they should be forced to pay section 106 contributions based on the ground rents they have raked in from leaseholders.

The High Court ruled in CWAC’s favour last year, and now the Court of Appeal has dismissed the developers’ appeal.

Lord Justice Rabinder Singh insisted it was ‘well-known that there can be a market in the sale of’ ground rents – and that CWAC was acting in the best interest of Northwich residents by requesting the funds.

Northwich Guardian:

The Royal Courts of Justice, in London, where the case was heard. Image: N Chadwick

He said: “A local authority has obligations not only to its council taxpayers generally but to members of the public who may be affected by proposed developments.

“In my view, the fact that the developers are unable to provide any sound commercial reason for excluding what would otherwise naturally be regarded as part of the true profits of the scheme is a relevant factor in arriving at the correct interpretation of the agreement.”

Winnington Urban Village has been constructed by a consortium of major developers – Morris Homes, David Wilson Homes, Barratt Homes and Taylor Wimpey.

After insisting the original financial agreement from 2008 was ‘too burdensome’ for the developers, a new legal agreement was struck with the council in April 2013.

It ruled that the developers would be required to provide details of the amount of money they have made from the project after completing the legal agreement on the 300th house.

This would be used to work out how much money the developers would hand over to CWAC – with 58.5 per cent going to for affordable housing, 23 per cent to education infrastructure and 18.5 per cent to Northwich’s regeneration.

Northwich Guardian:

Some of the money has gone towards Northwich's regeneration

Under the agreement, if CWAC did not agree with the calculations provided by the developers, it could seek expert advice.

This is what happened following the 300th sale in October 2016, as the developers did not include ground rents as part of the scheme’s profits.

Victoria Critchley, a fellow at the Royal Institute of Chartered Surveyors, gave an expert judgement in October 2018 which ruled the ground rents should be taken into account.

The developers took this judgement to the High Court in January 2019, insisting Ms Critchley had made an ‘error of law’, but the court ruled in favour of CWAC last October.

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This decision was then taken to the Court of Appeal, where it was considered at a hearing on October 27, before the court produced its judgement this month.

Controversial ground rents are at the centre of the leasehold scandal – where leaseholds have been sold off by developers to third parties and the rents have soared – and some Winnington Urban Village residents have been hit by the issue in recent years.