Very recently a decision in the Cayman Island Grand Court has cast doubt over the government’s Central Planning Authority and its ability to effectively deal with large real estate development proposals that are submitted exceeding seven stories on the coveted lands along Seven Mile Beach.

The Grand Court decision in the case of the Grand View Strata Corporation versus the Planning Appeals Tribunal could have lasting significance on the future look and layout of new construction on Seven Mile Beach. Moreover, the decision reached in this casebrings to new light the issues presentwhenbig development and antiquated planning legislation face off.

The essential details of the case are as follows… Recently a Cayman-based real estate developer applied to the Central Planning Authority for the necessary permissions needed to build a 10-story building with adjacent 4-storyapartments. This proposal also included provisions for a swimming pool, dock and a fence on the parcel located on the southern end of Seven Mile Beach. This application aroused local outcry, mainly from the owners in the surrounding properties. Government agencies also weighed in and nearly twenty different letters voicing concern about the proposed development were lodged. The Grand View Strata opposed the new construction ona great deal of grounds. The most relevant point it made being procedural unfairness and an overall failure to comply with the 1997 Development Plan and the Development and Planning Regulations in place here in the Cayman Islands. They also cited a breach of natural justice in the Central Planning Authority’s failing to specify valid reasons for its decision on the proposed buildings.

The Central Planning Authority concluded, after review, that the objections were not enough to deny planning permission and went ahead and granted the application subject to some conditions. After an appeal was lodged, the Planning Appeals Tribunal upheld Central Planning’s decision. The issue at stake in this case relates to theCentral Planning Authority’s understanding of setbacks for waterfront property and other technical inputs necessary to consider when approving waterfront development here in Cayman.In granting the application, the Central Planning Authority exercised it’s own discretion under regulations in place with respect to the setbacks of the proposed buildings. The Grand View Strata felt that the Central Planning Authority’s decision was characteristically flawed because it failed to take into consideration the proximity between the two proposed buildings on the site and that they failed to provide any rationale as to how they came to their decision.

On appeal to the Grand Court, the judge in the case stated that in the absence of regulations with respect to the eighth, ninth and tenth stories of the proposed building - the Central Planning Authority should have clearly stated how it dealt with the setbacks from the high water mark on the beach. Because of this and other contributing factors, the Court allowed the appeal and refused the developer’s application for planning permission.

The Grand Court’s turnaround of the application brings to light the importance of the 1997 Development Plan. In particular, it highlights the necessity for the Central Planning Authority to take into account technical considerations when coastal works are required for large waterfront projects. There is now doubt and uncertainty cast in the law with respect to high-rise developments. Additionally, with the judge taking the position that the Central Planning Authority lacked the authority to exercise its own discretion with respect to setback requirements with regards to buildings beyond seven stories until such time as the Regulations are amended there now exists an “anything goes” approach to setbacks for buildings over seven stories. Many view this ambiguity as completely unacceptable and stress that amendments to the regulations are sorely needed. Until those amendments are in place, there is aloophole in the system that may see exploitation in the near future.

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