7. What you should know about unilateral undertakings
General guidance for Unilateral Undertakings
A planning obligation is a legally binding agreement secured under Section 106 of the Town and Country Planning Act 1990 as amended. These obligations are usually made by entering into agreements which are regularly referred to as Planning Agreements or Section 106 Agreements. However it is possible for owners of land to submit Unilateral Undertakings to the Council, which contain the covenants given by the owner, which we can enforce.
Planning obligations require a developer or landowner to undertake certain works, or to contribute financially towards the provision of measures to mitigate the negative impacts of their development.
Where planning obligations are required, a planning agreement, drafted by our legal services team and entered into by the council and the developer or landowner will usually be appropriate. However there will be occasions where the use of Unilateral Undertakings can assist in ensuring that planning permissions are granted speedily. This benefits both the applicant and the council.
It will normally be appropriate for a Unilateral Undertaking to be used only if all the following conditions are met:
- the person entering into the Undertaking is the owner of the land (not merely a purchaser with a conditional contract); and
- the size of the proposal is small, i.e. 4 or less units, OR for larger proposals of 5 or more units, where there are no leases or tenancies (If the land is subject to a mortgage/legal charge, mortgage and mortgagee details must be included and the mortgagor must be a party to the Undertaking - see template); and
- the obligation(s) consists solely of the payment of financial contributions, of one or more of the types described in the template, to be paid on commencement of development.
The Undertaking includes an obligation to pay a legal fee to cover our costs in assessing the adequacy of the Undertaking (which will include checking the title to the land) and registering the Undertaking as a local land charge. If planning permission is not granted, then the Undertaking will not be registered as a local land charge.
If any of the above conditions are not met, we will normally consider the matter unsuitable for a Unilateral Undertaking and will expect the Applicant to enter into a conventional negotiated Section 106 Agreement, which will be drafted by the Council's Legal Services under their normal terms of business.
A Unilateral Undertaking is a legally binding document with significant financial consequences. If you are in any doubt about the meaning and effect of the undertaking you should seek independent legal advice.