Plan damage: 2% or 5% normal social risk for the applicant?

On June 21, 2017, the Administrative Law Division of the Council of State (further: the Division) issued an interesting ruling (ECLI:NL:RVS:2017:1653) on the question of when, in principle, a normal social risk of 5% of the damage suffered must be borne by the applicant in a request for planning damage.
Only special circumstances can then still lead to a lower percentage, because 5% of the damage suffered as a normal social risk for the applicant is the starting point.

Normal social risk

In a decision of September 28, 2016 (ECLI:NL:RVS:RVS:2016:2582), the Division - due to a practical need for it - provided a worthwhile outline overview of its case law on planning damage requests.
I limit myself here to the question of the applicable normal social risk in a plan damage request. Damage belonging to the normal social risk remains for the account of an applicant (Article 6.2 Wro). The law states that at least 2% of the damage remains for the account of an applicant in case of indirect plan damage.
In practice, the question regularly arises whether - given specific circumstances of the case - it is justified to leave a higher percentage than 2% of the damage for the applicant's account. In the June 21 ruling, the Division gives a clear opinion on this.

Case study Beuningen

The June 21 ruling deals with two requests for planning damage. In those proceedings, the applicants argued that their land had decreased in value as a result of the zoning plan "Oranjekwartier Noord," which had been adopted by the Beuningen City Council. Under that zoning plan, it was possible to build stacked housing at a distance of approximately 28 meters from their grounds.
It was not in dispute that both applicants' land had decreased in value by €20,000. That amounted to a 5.3% decrease in value of the applicants' lands. A 50% discount was then applied over that decrease in value. An amount of €10,000.00 is awarded to the applicants. This corresponds to a normal social risk of 2.65%.

Extent of normal social risk up to administrative body or judge?

The Division stated in its ruling that the determination of the extent of the normal social risk is first and foremost up to the administrative body, which has discretion in this respect. However, the administrative body must provide adequate justification for this determination.
The court tests this justification and - if the given justification is not sufficient - can itself determine, taking into account the circumstances of the case, which threshold or discount is reasonable in a concrete case. In doing so, the court may supplement the facts and value the facts underlying the decision differently than the administrative body did in the decision.

The criterion for determining the extent of normal social risk

From the Division's case law follows the following criterion for when damages fall within the scope of normal social risk:

The question whether damage is part of the normal social risk is answered taking into account all relevant circumstances of the case. Among other things, it is important whether the development can be regarded as a normal social development, which the injured party could have taken into account in the sense that the development was in line with expectations, even though there was no concrete insight into the extent to which, where and when the development would occur.
In this context, significance is attached to the extent to which the development, by its nature and size, fits within the spatial structure of the surrounding area and the policy pursued. Circumstances that may further be of importance are the distance of the location where the development took place from the immovable property of the injured party and the nature and extent of the disadvantage caused by the development.

What does this mean specifically?

1. Normal societal development?
   So the first question is whether there is a normal societal development. In previous case law, the Division has repeatedly ruled that, for example, infill development of housing in an existing residential core is, in principle, a normal social development, which occurs in many centers of cities and villages in the Netherlands.
   In the case in Beuningen, there was infill development and thus a normal social development. However, that in itself does not mean that the planning development was also in line with expectations.
2. In line with expectations?
   So the second question is whether a development was in line with expectations. It cannot be denied that the question of whether a development is in line with expectations is somewhat subjective. In any case, it can be deduced from the case law of the Division that it attaches importance to the previous zoning plan and the relevant policy.
   In the matter in Beuningen, the Division ruled - unlike the city council and the court - that the stacked housing construction was in line with expectations. After all, under the previous zoning plan, housing development was already possible at the location in question. Albeit that that housing construction was only possible up to 3.5 and 7 meters in height, respectively, while the new zoning plan allows for a guttering and building height of 14 meters.
   However, this does not lead the Division to a different opinion because stacked housing was already possible in the vicinity of the applicants' plots. Thus, the building now made possible fits into the structure of the surroundings. The Division notes that the new construction was therefore in line with expectations.

Department: 5% normal social risk borne by applicant

Since in the Beuningen case there was a normal social development, which was in line with expectations, the Division sets a higher limit to the normal social risk as a starting point. The Division rules:

In the case of impairment of an immovable property as a result of a normal social development, such as housing development on an infill site in a residential nucleus, where such housing development was in line with expectations, an impairment of up to five percent of the value of the immovable property, in relation to the value of the immovable property immediately before the damage occurred, is substantial, but not so severe that this damage cannot be left to the applicant.
This means that a decrease in value up to five percent of the value of the immovable property in this category of cases is in principle part of the applicant's normal social risk.

It can be inferred from the ruling that an administrative body can only set a lower percentage under special circumstances.
In the Beuningen case, the Division ruled - unlike the District Court - that a distance of 28 meters between the new building and the applicants' plots is not so short as to constitute a special circumstance. This means that 5% of the damage suffered must be borne by the applicants. The Division provides in the Beuningen case itself.

Conclusion

The Department is clear. If there is normal social development, which is in line with expectations, 5% of the damage suffered should remain the responsibility of an applicant. Only if special circumstances are present does this possibly become different.

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