What if your practice has no planning permission?

A surprising number of commercial properties in use by the healthcare sector do not have planning permission for the current use of the property. More often than not owners and occupiers of these properties rely on the number of years they have used the property, for the current use, as evidence of the property’s authorised use.

Long user

Sometimes use for a commercial property – such as a practice or care home – can be established via “long user”. In essence, a use can be permitted if it has been carried out continuously at the property for 10 years or more, without formal planning permission being in place.

Therefore, if there is no specific planning permission for the use of the property then buyers, occupiers and lenders can rely on the use of the property being authorised by long user.

Local authority enforcement period

The local planning authority only has 10 years from the date of the change of use to take enforcement action and from the date of any breach of planning permission. However, they only have 4 years to take enforcement action for a change of use from commercial to a residential dwelling.

Therefore, it is not a major consideration if a practice has no planning permission where the use has been continuous for 10 years or more, as the risk of the local planning authority taking enforcement action is negligible.

Certificate of lawfulness

A certificate of lawfulness is a certificate issued by the local planning authority which confirms the existing use of the property and as such it blocks any enforcement action being taken for the absence of planning permission for commercial use. However, health and social care organisations should note that this does not provide protection against all claims.

For example, if the property is a listed building, then it’s likely listed building consent is required and this will not be covered in a certificate of lawfulness. Some buyers and occupiers may insist on a certificate being provided and this can sometimes be a cheaper and quicker option than obtaining retrospective planning permission.

Indemnity insurance 

Indemnity insurance is a solution if parties are not comfortable relying on long user. Indemnity insurance can be taken out by any party in a transaction and can cover against the risk of anyone taking enforcement action for lack of planning permission for commercial use and breach of planning permission conditions.

If a claim is ever brought then the policy holder can make a claim on the insurance. The majority of lenders require indemnity insurance be taken out in their favour for additional protection for their security.

Indemnity insurance can often be an inexpensive way for healthcare providers to proceed with a property which has no planning permission. The cost of the insurance can vary depending on how long it has been since the use began. It is likely to be more expensive if the use has not been continuous for 10 years.

Rest assured there are options for owners and occupiers to proceed with leasing or selling their properties if there is no planning permission for the current commercial use of the property.

Some parties may be content with proceeding on the basis of long user and others may want the additional comfort of having a certificate of lawfulness and/ or indemnity insurance. However, the risk is much higher if the use of the property has not been continuous for 10 years and if this is the case then retrospective planning permission may need to be obtained.