A Bushey company has claimed the council is trying to boost revenue “over a technicality” after it was handed a £732,00 bill.

Lincolnsfield (Bushey 4) Ltd had sought permission to contest a bill from Hertsmere Borough Council, relating to its 55-home development off Bushey Hall Drive, at the Court of Appeal.

A review by Lady Justice Thirlwall decided the case had “no prospect of success”.

Although the council had previously referred to Heronslea Ltd, the company says Heronslea Ltd was the contractor and the demand notice was addressed to Heronslea (Bushey 4) Limited, now Lincolnsfield (Bushey 4) Ltd.

It claimed the huge payments it now faces are “all because of a technicality” and have put the company into a difficult financial situation while it is already battling pressures from the pandemic, labour shortages, and soaring inflation.

A developer must submit a commencement notice to the local authority before work begins on a development, but in 2019 the council said officers noticed buildings were demolished and trenches were dug, but no commencement notice had been received.

Lincolnsfield (Bushey 4) Ltd argued it was only liable for a £1.1 million Community Infrastructure Levy (CIL) because the development included affordable housing and qualified for housing relief. 

But local authorities are entitled to withdraw the relief if they have not been properly notified, which means the business now has to pay another £732,000.

A spokesperson for the developer said: “Due to a difference of opinion as to what constituted the commencement of development, Hertsmere took the view that they were entitled to withdraw the CIL relief. 

“The irony of this is that the government clearly foresaw how unfair it is for social housing relief to be withdrawn in circumstances like ours, and changed the law just a few months after Lincolnsfield (Bushey 4) Ltd started work on the site, so that the maximum penalty is now only £2,500.

“This case was solely motivated by a need to boost its revenue at the expense of developers who have done so much already to contribute to the community.”

In response to the claims, a council spokesperson said: “We followed regulations that were applicable at the time, and this has been upheld by the courts.”