The case of Trafford v Blackpool Borough Council [2014] EWHC 85 (Admin) is a salutary warning for those public servants (be they elected politicians or employee officials) who imagine themselves beyond the reach of the law.
Given the facts as found by the Judge, Judge Stephen Davies (Sitting as a Judge of the High Court), are scarcely believable in the 21st Century this piece might equally have been called "Let's evict all the lawyers". But don’t take my word for it; read them yourself in paragraphs 7 to 30 inclusive of the judgment.
In summary however the position is as follows:
The claimant was a solicitor who practised under the firm name North Solicitors (the firm), principally in the personal injury field.
Her office premises were located in the New Blackpool Enterprise Centre (the Centre). The Centre was owned by the defendant local authority and its principal aim was to act as an accelerator to developing new innovations and consequently increasing economic growth and prosperity in the local area. Units within the Centre could only be occupied by private sector businesses falling within the EU definition of a small and medium sized enterprise. Prospective tenants had to demonstrate their eligibility and suitability, with the Centre management board determining applications.
In March 2008, the claimant obtained a three year lease of a unit in the Centre. In June 2010, the claimant sought and obtained a new three year lease of a larger unit in the Centre. In November 2012, unknown to the claimant, the authority's corporate asset management group decided that the claimant's lease should be terminated as the firm had brought a large number of personal injury claims against the authority. In June 2013, the claimant became aware that her lease of the unit would not be renewed. She was informed that the reason for that decision was that the firm had brought a number of personal injury claims against the authority.
Not unsurprisingly the claimant applied for judicial review of that decision submitting, inter alia, that the authority had exercised its power for the improper or unauthorised purpose of seeking to cause detriment to the claimant, even though the firm was acting entirely lawfully.
A preliminary issue arose as to whether the decision was amenable to judicial review (the amenability issue). In respect thereof, the claimant submitted, inter alia, that the authority had been acting under the statutory power conferred by s 123 of the Local Government Act 1972.
The section provides that:
"(1) Subject to the following provisions of this section, and to those of the Playing Fields (Community Involvement in Disposal Decisions) (Wales) Measure 2010, a principal council may dispose of land held by them in any manner they wish.
(2) Except with the consent of the Secretary of State, a council shall not dispose of land under this section, otherwise than by way of a short tenancy, for a consideration less than the best that can reasonably be obtained.
(2A) A principal council may not dispose under subsection (1) above of any land consisting or forming part of an open space unless before disposing of the land they cause notice of their intention to do so, specifying the land in question, to be advertised in two consecutive weeks in a newspaper circulating in the area in which the land is situated, and consider any objections to the proposed disposal which may be made to them.
(2AA) Subsection (2A) does not apply to a disposal to which the provisions of regulations made under section 1 of the Playing Fields (Community Involvement in Disposal Decisions) (Wales) Measure 2010 apply.
(2B) Where by virtue of subsection (2A) above or in accordance with the provisions of regulations made under section 1 of the Playing Fields (Community Involvement in Disposal Decisions) (Wales) Measure 2010 a council dispose of land which is held — (a) for the purposes of section 164 of the Public Health Act 1875 (pleasure grounds); or (b) in accordance with section 10 of the Open Spaces Act 1906 (duty of local authority to maintain open spaces and burial grounds), the land shall by virtue of the disposal be freed from any trust arising solely by virtue of its being land held in trust for enjoyment by the public in accordance with the said section 164 or, as the case may be, the said section 10.
(3)–(5) . . .
(6) . . .
(7) For the purposes of this section a disposal of land is a disposal by way of a short tenancy if it consists — (a) of the grant of a term not exceeding seven years, or (b) of the assignment of a term which at the date of the assignment has not more than seven years to run, and in this section “public trust land” has the meaning assigned to it by section 122(6) above."
The authority contended, inter alia, that in deciding whether or not to offer a further lease to the claimant, it had performed a purely private function, in circumstances where it owed no public duty to the claimant and in the context of a purely commercial relationship in relation to purely commercial premises.
The Judge allowed the claim holding:
First, in respect of the amenability issue, it was established principle that in a case involving a challenge to a decision of a public body in relation to a contract, it was necessary to consider:
- whether or not, and if so to what extent, the public body was exercising a public function in making the decision complained of; and
- whether, and if so to what extent, the grounds of challenge involved genuine and substantial public law challenges to the decision complained of, or whether, and if so to what extent, they were in reality private law challenges to decisions made under and by reference to the terms of the relevant contract.
On the facts, the authority had been under a duty not to exercise its discretion for improper or immaterial purposes. In the instant case, there was no evidence that the defendant had conducted a rational assessment of all relevant considerations, including the extent to which the claimant had met the published tenant selection criteria and the nature of its business having regard to the wider community interest including that of the authority itself.
Further, in a case involving a challenge to a decision of a public body acting under a statutory power but in relation to a contract and in the absence of a substantial public function element, a claimant would nonetheless normally be entitled to raise genuine and substantial challenges based on fraud, corruption, bad faith and improper motive.
Furthermore, the extent to which a claimant would be entitled to raise genuine and substantial public law challenges beyond those limited classes would depend on a careful analysis of all of the relevant circumstances so as to see whether or not there was a relevant and sufficient nexus between the decision in relation to the contract which was challenged and the grounds complained of (see paragraph 55 of the judgment).
In the instant case, the authority had chosen to promote a policy in relation to tenancy selection criteria under which it had stated in clear terms that it had delegated the decision on the suitability of an individual applicant to the Centre management board, to be taken by reference to specific criteria. Accordingly, it was not solely a purely arms length commercial relationship.
Second, on the facts, there was a sufficient public law element or connection to render the authority's decision amenable to judicial review on all such grounds. At the very least there was a sufficient public law element or connection to render the decision amenable to judicial review on the ground of abuse of power (see paragraphs 57 and 60 of the judgment).
Based upon its conclusion that the firm was engaged in claims farming which harmed the authority's own financial interests, the only consideration which it had had regard to when deciding whether or not even to consider a request by the claimant for a new tenancy had been its desire to punish the claimant for engaging in that activity by subjecting her firm to some difficulty and inconvenience, without having any regard to whether or not that would have achieved any benefit for the wider community interest or indeed the authority's own financial interests.
Accordingly, the authority had failed to exercise its power to promote the purpose for which it had been conferred, having regard not just to the wide power conferred by s 123 of the Act itself, but also the circumstances in which the Centre had been constructed and operated at public expense and for public good and in which the authority had promulgated and implemented a policy as to the selection of tenants.
The authority's decision had been fundamentally tainted by illegality and, for that reason, should be quashed (see paragraphs 70 and 71 of the judgment).
That however is not the end of the matter.
The Government is currently promoting changes to the way in which Judicial Review is to apply and operate.
These ‘reforms’, some long over due and some less welcome, are to be found in the Government’s response to the recent consultation exercise , and the Judicial Review Fact Sheet published alongside the Criminal Justice and Courts Bill.
The Senior Judiciary responded to the proposals and the Justice Secretary took a lot of these on board according to Joshua Rosenberg.
There are also a number of very helpful and insightful articles on how the proposals might impact on my particular area of interest by Adam Wagner, Richard Harwood QC and Angus Walker which are well worth reading.
There is, in my view, a wider public benefit in a Judicial Review mechanism that not only holds public law decision makers to account for their actions but also fosters good administrative decision making. It is to be hoped that the changes to the system impede neither of those benefits in the name of short term party political 'expediency'.
