Q&As

A developer has entered into a section 38 agreement and associated bond. The works have not been started and the developer no longer wishes to pursue them yet the local authority is refusing to cancel the section 38 agreement and to release the bond. Is there any legislation which can help?

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Published on LexisPSL on 14/11/2017

The following Planning Q&A provides comprehensive and up to date legal information covering:

  • A developer has entered into a section 38 agreement and associated bond. The works have not been started and the developer no longer wishes to pursue them yet the local authority is refusing to cancel the section 38 agreement and to release the bond. Is there any legislation which can help?

Section 38 agreements are governed by section 38 of the Highways Act 1980, see Practice Note: Highways—adoption agreements. There is no statutory process pursuant to which such an agreement can be terminated or ‘cancelled’. In principle, existing section 38 agreement can be varied by deed of variation, but would require the consent of all parties to the original agreement.

It is to be noted that the substantive obligations in section 38 agreements are usually drafted to be triggered only upon the redevelopment of the site commencing—in other words, while

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