A Labour council’s decision to introduce a low-traffic neighbourhood (LTN), which earned it £1 million in fines from motorists, has been ruled unlawful. Lambeth council has raked in £1,080,580 from penalty charge notices (PCNS) since October, when it closed roads and unfairly ignored legitimate concerns from residents that it would cause an increase in traffic disruption and more pollution.

LTN’s involve closing roads to some traffic and then fining motorists who enter. In Lambeth, entering a road closed under the LTN could result in a fine of up to £160, which is reduced if paid within a given timeframe. Campaigners are now demanding that the council pays back the money it has earned in fines since introducing the scheme, which, according to the Telegraph, has earned the authority more than £180,000 a month since the LTNS’ introduction.

The West Dulwich Action Group (WDAG), made up of residents opposed to the scheme, said: “As the LTN has been declared unlawful, there can be no possible justification for Lambeth to keep the fines collected since September last year, and so they should be refunded.”

A report produced by the group was labelled as “impressive” by Tim Smith, the deputy judge who said that Lambeth was guilty of a “serious failing” after it ignored warnings issued by local campaigners.

He further accused the council of giving a “masterclass in selective partial reporting” after a council document failed to record public consultation on the scheme.

He said: “The failure to have regard to it was a serious failing, rendering the decision to make the orders unlawful.”

However, he added: “I did not harbour any significant concerns about the conduct of the consultation and engagement as a whole.”

WDAG have become the first residents’ group to be successful in legal action connected to the introduction of an LTN, which critics argue increases congestion because it forces traffic onto already busy roads by preventing access to quiet ones.

The judge’s ruling could see the LTN scrapped altogether, in a major embarrassment for the local authority.

In response, the council said that it “acknowledged” the court’s decision and was considering the implications of the ruling.

The LTN was introduced to promote green and active travel methods such as walking and cycling.

A Lambeth council spokesman said: “Lambeth council has introduced a trial neighbourhood scheme in West Dulwich to make streets safer, create new community spaces and support people to walk and cycle around the area.

“We have thoroughly engaged with and listened to the local community throughout the development of these proposals and provided opportunities for residents and businesses to feed back. We ask that all road users follow the law, so they do not get a fine.”