Guidance
Unilateral Undertaking Templates – an alternative to a S.106 Agreement
What are S.106 Agreements?
As part of the planning process, the Council and a developer seeking planning permission
may enter into a legal agreement – usually following Planning Applications Committee
(PAC) recommendation to grant planning permission subject to such an agreement being
entered into – that will set out the terms for the developer to provide or fund the provision of
infrastructure, services or other impact mitigation measures on or off the development site.
This agreement is referred to as a “Section 106 Agreement or Planning Obligation”.
What are Unilateral Undertakings?
A unilateral undertaking like a S.106 agreement is a legal deed where developers covenant
to perform planning obligations however unlike S.106 agreements they don’t have to be
entered into by the local authority. A unilateral undertaking comes into effect when
planning permission to which they are linked is granted.
When should Unilateral Undertakings be used?
Where financial contributions are known at an early stage and the package of planning
obligations is reletively straight forward, namely involving commuted payments for
education, open space or sustainable transport, or/and car free or permit free obligations,
applicants are encouraged to submit a unilateral undertaking with their application. The
intention is that the unilateral undertaking can be included with the suite of documents
associated with the planning application. . While S.106 agreements are usually prepared
following PAC the draft form of unilateral undertaking can usually be agreed prior to PAC
thereby avoiding delays in getting a final decision. Unilateral undertakings will not usually
be appropriate for major applications including applications for 10 or more new dwellings.
Where can I find Merton’s Unilateral Undertakings templates?
Merton’s unilateral undertaking templates can be found on the Planning application forms
and fees page.
What will the Unilateral Undertaking require, payments etc?
It will require the developer to pay financial contributions towards open space, education,
and/or sustainable transport improvements. It may also require all additional dwellings to
be built to be car-free or permit-free which means that no occupants of those flats will be
entitled to residential parking permits and for “car free” dwellings that no vehicles will be
permitted to be parked within the curtilage of the site.
To help you to calculate financial contributions that have been deemed necessary for your
development you could use our free calculator on the S.106 web-page. Please note: the
calculator is for guidance only and does not determine the final value of the contributions
and other obligations or heads of terms that will be confirmed by the Development Control
Case Officer who has been/will be assigned to process your application. Futher information
in relation to the financial and in-kind obligations is contained within Merton’s Planning
Obligations SPD. It is a validation requirement for relevant applications to demonstrate
how the Planning Obligations SPD would be met. The best way of being certain of the
contributions that will apply to a planning application is to discuss these in a pre-application
advice session. The costs for this advice is described on the Pre-application advice
charges page
The unilateral undertaking will also require the developer to pay the Council’s legal fees
and monitoring fees. The legal fees are necessary to meet the Council’s costs for checking
agreeing and registering the unilateral undertaking as a local land charge. The monitoring
fees are required to meet the Council’s costs for monitoring compliance of the terms of the
Unilateral Undertaking and for ensuring that information regarding the planning obligations
are properly communicated within the Council and the community. The monitoring fees can
be calculated once the financial contributions and in-kind obligations are confirmed
following the formulas in paragraph 2.20 of the Planning Obligations SPD.
When will the financial contributions become payable?
The templates state payment of financial contributions will be upon commencement of
development. Commencement usually is when building works start on the site after site
preparation, clearance and demolition has commenced. In addition to the financial
contributions there are also the Council’s monitoring fees and legal fees which will need to
be paid before the unilateral undertaking is accepted and (any) grant of planning
permission.
When do I need to start preparing a Unilateral Undertaking?
Applicants should submit a unilateral undertaking with their application. Therefore it is
important to start preparing the unilateral undertaking as soon as possible prior to
submitting a planning application.
Preparing and submitting a Unilateral Undertaking
Unilateral Undertakings should be submitted to Merton’s Development Control Team as
part of the planning application. In submitting a unilateral undertaking applicants/agents
are to accompany the unilateral undertaking with an up to date official copy of the register
and plan of the title to the property which is the subject of the planning application from the
Land Registry. Merton will not accept unilateral undertakings where all parties with a legal
interest in the land according to the official copy above are not parties to the unilateral
undertaking and signatories to it. It is recommended that applicants employ a solicitor to
assist in filling out the unilateral undertaking and in making any amendments to it requested
by the Council. The unilateral undertakings should be submitted in draft form – i.e. not
signed or dated – and where possible in electronic format so that they can be checked by
the Council’s Legal Department and any alterations made before the final – signed and
dated (including the site plan attached) – Unilateral Undertaking is submitted.
Is there an example of a Unilateral Undertaking so I can see how it might
look?
An hypothetical example of a draft Unilateral Undertaking using the Merton Council
templates can be found at the end of this guide.
What are Merton’s legal fees for checking draft Unilateral Undertakings?
The fees which will be payable before the final signed and dated Unilateral Undertaking is
approved by the Council are as stated in the templates and differ according to the template
that is used as follows:
Template
Legal Fee
Education
£350
Education & Open Space
£500
Education, Open Space & Sustainable Transport
£500
Education, Open Space & Car Free
£500
Education, Open Space, Sustainable Transport & Car Free
£500
Education & Car Free
£500
Open Space
£350
Open Space & Car Free
£500
If the wording of the unilateral undertaking that has been submitted differs to that of the
wording of the templates (other than the wording within the square brackets) then there
may be further legal fees payable due to the increase in costs for the Council’s Legal
Services involvement in getting an acceptable form of Unilateral Undertaking agreed.
Do I still need to pay the financial contributions if the planning
application is refused?
No, only the legal fees would be payable. The unilateral undertaking only becomes
effective if planning permission is granted. However it is worth retaining a record of the
unilateral undertaking even if permission is refused so as to not have to do the work all over
again should you wish to submitt a new application.
Date to be inserted once the Council is
happy with the draft Unilateral Undertaking
that has been submitted to it.
DATED
20
(1) Name of Owner
(2) Name of Morgagee
(1) Mr Joseph Blogs and Mrs Josephine Blogs
(2) High Street Bank
(3) London Borough of Merton
__________________________________________
UNILATERAL UNDERTAKING
Pursuant to Section 106
Town & Country Planning Act 1990
Relating to
2 Dadwarrs Close, Wimbledon SW19 1AB
_______________________________________________
Head of Civic and Legal Services
London Borough of Merton
Civic Centre
London Road
Morden
Surrey SM4 5DX
(1) Full names and addresses of any owner listed on the Register of Title.
(2)Full name and address of any mortgagee listed on the Register of Title
Date to be inserted once the Council is
happy with the draft Unilateral Undertaking
that has been submitted to it.
THIS DEED OF UNILATERAL UNDERTAKING is given the
day of
20
by (1) [ Mr Joseph Blogs and Mrs Josephine Blogs, 1 Dadwarrs Close, Wimbledon
SW19 1AB ("the Owner") and [ High Street Bank, 123 High Street, Wimbledon,
SW19 2CD] (“the Mortgagee”) (2) to (3) the LONDON BOROUGH of MERTON
of Merton Civic Centre, London Road, Surrey, SM4 5DX (“the Council”)
WHEREAS:(1)
The full address of the site of the
development for which planning
permission is sought.
The Owner has an interest in land at [2 Dadwarrs Close, Wimbledon, SW19
1AB] ("the Land") as more particularly described in the First Schedule
The date of the charge on the
Register of Title.
(2)
The Mortgagee has a charge dated [1 January 2011] over the Land
(3)
The Council is the planning authority for the area in which the Land is situated
(4)
The Owner has applied for planning permission to [Construct two twobedroom town houses] (“the Application”)
(5)
The full development as described
on the planning application form.
The Owner acknowledges that:(a)
the Land is inappropriate to provide
private amenity space in
accordance with the Council's planning policy and
(b)
the proposed development creates a need for improvements to local
open space and
(c)
the proposed development will generate a need for additional
educational facilities and
(d)
it is appropriate to make financial contributions to improve local open
space and for educational purposes within the locality of the Land
(e)
that occupiers of the Land will not be entitled to a residents parking
permit for a Residents Parking Bay within the CPZ
(6)
The Owner considers that certain planning obligations should be entered into
as of the date of this Deed (subject to any conditions as are set out in this
Deed) in respect of the Land
NOW THIS DEED witnesseth as follows:1.
Definitions and Interpretation
In this Deed:-
1.1
“the Act” means the Town & Country Planning Act 1990
1.2
“Commencement” means the carrying out of a material operation as defined
by Section 56(4) of the Act in relation to the development as described in the
“Commencement” is generally the start of building works on site which is when the financial
contributions will become payable. The works/operations that can be done prior to the payment of the
financial contributions are listed in this clause 1.3 over the page.
Planning Application granted planning permission but shall not include the
following:
This combines the financial
contributions required for the
development as confirmed by
Merton Council Development
Control Officer. See the Second
Schedule for when these monies
become due. The Second
Schedule also refers to legal and
monitoring fees that are payable
prior to the acceptance of the final
Unilateral Undertaking and prior to
the release of a decision notice
with respect to the planning
application.
(i)
demolition, site clearance and preparation of the Site
(ii)
soil or ground or environmental investigation and
surveys and inspections and works
(iii)
Site security and survey work
(iv)
construction of boundary fencing or means of enclosure
for site security
(v)
archaeological investigation surveys and inspections or
works
(vi)
works of decontamination or remediation
(vii)
site reclamation works
(viii) laying of services or carrying out of services diversion
works or any work to or in respect of statutory utilities
equipment
This is to ensure that the amounts payable for
the financial contributions are increased in
line with increases in retail prices nationwide
as published by the Government Office of
National Statistics
1.3
“CPZ” means a controlled parking Zone
1.4
“Financial Contribution” means the sum of £[7,240.56] to be applied to
educational purposes in the locality of the Land plus the sum of £[4,580.00] to
be applied to public open space improvements in the locality of the Land.
1.5
“Index” means the index of Retail Prices (All Items) published by the Office
for National Statistics
1.6
“the Planning Obligations” mean the obligations specified in the Second
Schedule
1.7
“Residents Parking Bay” means a parking place designated in an order under
section 45(2) of the Road Traffic Regulation Act 1984 for the use of
designated residents in the locality
1.8
Words importing one gender shall be construed as importing any other gender
1.9
Words importing the singular shall be construed as importing the plural and
vice versa
1.10
The clause and paragraph headings in the body of this Deed and in the
Schedules do not form part of this Deed and shall not be taken into account in
its construction or interpretation
1.11
Obligations entered into by more than one person shall be joint and several
2.
The Planning Obligations
2.1
The Planning Obligations contained in this Deed are planning obligations for
the purposes of Section 106 of the Act
2.2
The Planning Obligations may be enforced by the Council
2.3
No person shall be liable for a breach of covenant contained in this Deed after
he shall have parted with all interest in the land or the part in respect of which
such breach occurs but without prejudice to liability for any subsisting breach
of covenant prior to parting with such interest
2.4.1
The Planning Obligations contained in the Second Schedule to this Deed shall
not come into effect until the grant of planning permission pursuant to the
Application
2.4.2
The Mortgagee consents to the Owner giving this Undertaking and
acknowledges that the Mortgagee has no liability hereunder unless the
Mortgagee takes possession of the Land
3.
Payment of Interest
3.1 It is hereby agreed that in the event of late payment by the Owner of any sums due
under this Undertaking the Owner shall pay interest on such sum at the rate of 4%
above the base rate from time to time in force of the National Westminster Bank
Plc from the date such sum falls due to the date of actual payment
IN WITNESS whereof this Deed has been duly executed the day and year first above
written
FIRST SCHEDULE
The Land
Freehold land comprised in Land Registry Title No. TGL104525
shown edged red on the attached plan
SECOND SCHEDULE
“Commencement” is generally the start of
building works on site. For works that can be
done prior to the payment of the monies see
the definition for “Commencement” above.
The Planning Obligations
1. The Owner will prior to Commencement pay to the council
2.1 the Financial Contribution
and
This is the sum total of the financial
contribution required as described in the
definition of “Financial Contribution” above
2.2 an additional sum which is a sum equal to the difference in each case
This is to ensure that the
amounts payable for the
financial contributions
are increased in line with
increases in retail prices
nationwide as published
by the Government
Office of National
Statistics
between the payment of the Financial Contribution and a sum arrived
at by increasing the Financial Contribution by the percentage by which
the Index has been increased between the date hereof and the date
payment is received by the Council (and for the purpose of calculating
the increase the Index for which most recent official figures published
by the Office for National Statistics are available shall be deemed to be
the index prevailing at the date the payment is due)
2. The Owner covenants with the Council that
2.1 No occupant of the Land shall bring cause and/or permit any motor
Clauses 2 to 2.3 are to
ensure that occupiers of
the dwellings to be built
will not be entitled to a
residents parking permit
for a Residents Parking
Bay within the CPZ or
park a vehicle on the
land.
vehicle to be brought onto the Land or cause and/or permit to be left
abandoned and/or parked any motor vehicle within the Land
2.2 The Land shall not be used and/or occupied by an occupant who has at
the date they use and/or occupy the Land a permit to park a motor
vehicle in a Residents Parking Bay unless such occupant
i. is or becomes entitled to be a holder of a disabled person’s
badge issued pursuant to section 21 of the Chronically Sick and
Disabled Persons Act 1970 and PROVIDED THAT the
occupant has first notified the Council in writing of such
entitlement and has provided proof thereof if required to do so
by the Council
ii. No occupant whilst residing using and/or occupying the Land
shall purchase or procure the purchase of a parking permit for
a Residents Parking Bay within the CPZ.
iii. Upon the first and any subsequent change in the identity of any
occupant the occupant shall within 10 working days of taking
up use and/or occupation of the Land notify the Council in
writing of the change in occupancy thereof
2.3 The Owner shall procure that the restrictions set out in paragraph 2.1
are included in any lease option licence tenancy or other disposal of the
Land to any Person
3. The Owner will on the date hereof pay to the council
3.1 A monitoring fee of £ [1,341]
3.2 legal costs of £500
SIGNED as a DEED by ( Owner)
(name) Joseph Blogs 
Josephine Blogs
Josephine Blogs
in the presence of:
Witness
Name………Henry Halfwright..
Address……1 Twofree Street, London SW19 4FS
Occupation…Solicitor…………………
Signature……

EXECUTED as a DEED by
(Mortgagee) acting by
(name)
High Street Bank
Authorised Signatory…H.S.B Manager
The monitoring fee is calculated in
accordance with paragraph 2.20 of
Merton’s Planning Obligations SPD and is
necessary to fund the Council’s monitoring
of compliance of the terms of the unilateral
undertaking. This will need to be paid
before the decision notice in relation to any
grant of planning permission is released.
The legal costs payment is to meet the
costs for the Council’s Legal Services in
checking the and agreeing the unilateral
undertaking and will become payable prior
to the unilateral undertaking being
accepted.
The owners can sign the Unilateral
Undertaking once the Council is happy with
the draft Unilateral Undertaking that has
been submitted to it. It needs to be signed
here in the presence of a witness who is
also to sign where indicated. All owners
are to print their name and then sign.
The mortgagee, if there is one on the
Registry of Title, will also need to sign the
Unilateral Undertaking template but only
once the Council is happy with the draft
Unilateral Undertaking. If the mortgagee
uses a stamp or seal for such
authorisations then this should be used