Judicial Review Insurance

Holly Hamer, Business Development Executive, explores Judicial Review (JR) Insurance, and how it can benefit you.

What is Judicial Review Insurance?

A Judicial Review indemnity policy is taken out to cover the risk of a third party attempting to challenge the lawfulness of a decision granted by a public authority on a property or piece of land that you as the owner intend to develop.

How does this policy benefit you?

It can be extremely frustrating as a developer to hear the news that even after planning permission has been granted, a third party has challenged the legality of the decision and is taking you to court as a result.

Although the third party has six weeks from the date of the planning decision to bring a claim, the actual time spent in court can take much longer which can be financially detrimental.

The two main worst-case scenarios for a developer would be:

1. You can’t start work on the project. This places you behind deadlines which causes significant delays and results in increased costs and reduced profit margins
   
   
2. Planning permission can be quashed during or after the six-week period. So, if you go to court and the process takes longer than this, or the courts over-turn planning you could end up with no planning permission causing a huge loss to the value of the land

An insurance policy would allow for the development to progress even during this six-week period and if planning does get quashed the policy would cover the loss in value of the land. This is hugely beneficial to the developer as it provides peace of mind, financial protection, and comfort to financial investors.

What is covered under a JR policy?

A Judicial Review insurance policy provides cover for the financial losses which could arise in the event of a judicial review of planning or other decision, such as:

• Loss in property value
• Abortive costs of works
• Delay costs
• Increased lending costs
• Penalties under agreements with third parties

What information do we need?

For us to obtain quotes from the market, we require the following information:

• A copy of the Committee Report or Planning Officers report
• Limit of indemnity (this is usually based on the difference in value of the land with and without the benefit of planning plus any abortive costs of works undertaken)
• Details of any works intended to be carried out during the six-week period
• Copies of the title register(s) to the insured property

To discuss a potential judicial review risk, please contact our experts - Graham Waller, Account Director T: 07508 457 819 or Holly Hamer, Business Development Executive T: 07935 709 157.

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