LEGITIMATE EXPECTATION

June 28th, 2024 by James Goudie KC in Decision making and Contracts

Two decisions on legitimate expectation.  The first is R (BIRMINGHAM CITY COUNCIL) v SoS for TRANSPORT (2024) EWHC 1487 (Admin).  It concerned both substantive and procedural legitimate expectation.  The terms of a letter from the SoS to the Council confirming that Private Finance Initiative credits had been issued towards the capital costs of a highway project, and the Local Government PFI Project Support Guide (2009-10), had not created a legitimate expectation that if the PFI contract was terminated or varied the Government would withdraw credits only in exceptional circumstances.  However, the SoS had acted unfairly by withdrawing the credits without offering the Council a further opportunity to make representations.  On  substantive legitimate expectation, it was reasonably to be expected that the Council would rely on the guidance in the July 2010 letter and in Section G of the Guide on the topic of termination or variation of PFI contracts. The Government had intended that the claimant should rely on Section G of the Guide for that purpose.  However, the examples in Section G offered practical advice and guidance to local authorities on the application of the government’s policy to possible scenarios and were not intended to be read as an unqualified commitment by the Government as to how it would proceed in the circumstances of any actual case. The language was deliberately qualified in its terms.  The July 2010 letter and Section G para 2.1 of the Guide did not give rise to the substantive legitimate expectation for which the claimant contended.  However, as to procedural legitimate expectation/fairness, there had ben a clear shift in the Government’s position following the Council’s submission of its Full Business Case in August 2023, which had not been made known to the Council and upon which the Council had no opportunity to reflect or to engage, but which had very significantly affected the outcome of the process. In the light of what had gone before, fairness demanded that the Council should have been given the further opportunity to engage and respond.

 

The second decision is R (DONALD) v SSHD (2024) EWHC 1492 (Admin), again concerned with both substantive and procedural legitimate expectation, amongst other matters.  A decision by the SoS not to implement two of the 30 recommendations made in the “Windrush Lessons Learned Review”, an independent assessment of the events leading up to the “Windrush” scandal, was unlawful. The decision breached a legitimate expectation that the Home Office would not decline to implement any of the recommendations without first consulting relevant stakeholders; breached the public sector equality duty; and indirectly discriminated against the Windrush community.  As to substantive legitimate expectation, the Home Office had published a plan of future action in relation to a policy that was to be kept under review and would continue to develop.  It contained no explicit statement that all 30 recommendations would be implemented, and nor was that implied.  Although its focus was on how, and not whether, the recommendations would be implemented, that did not amount to a sufficiently clear, unambiguous and unqualified representation as to give rise to a substantive legal expectation that all of the representations would be implemented.  Indeed, it indicated that some of the Recommendations would be the subject of further investigation and deliberation.  Moreover, it had been published to the world at large.  While a substantive legitimate expectation could arise from a promise made to the world at large, the cases in which that happened were ones in which the main beneficiaries of the promises formed a relatively small group.  It was difficult to envisage a case in which the Government would be bound by a representation made generally or to a diverse class.  As to procedural legitimate expectation, there was a legitimate procedural expectation that the SoS would consult with relevant stakeholders, including the Windrush community.  Although there was no explicit statement to that effect, the prospect of a lack of consultation was so conspicuously unfair as to give rise to a legitimate expectation that there would be consultation.

 

TUPE

June 27th, 2024 by James Goudie KC in General

Can a reorganisation/ mergers, involving the transfer of functions between public authorities, constitute a TUPE transfer? No : says the EAT in the NHS case of BICKNELL. This followed the EAT’s decision in NICHOLLS v CROYDON LBC (2019) ICR 542. The purchasing or commissioning  of goods or services not on the market is held not in itself to be capable of constituting an “ economic activity “ within the TUPE definition of a “ business transfer”. If the Croydon Council case is wrong, it requires the Court of Appeal to correct that.

 

EMPLOYMENT

June 27th, 2024 by James Goudie KC in Decision making and Contracts

In TAYLORS SERVICE LTD v HMRC (2024) EAT 102 the appellants are employers of workers on zero hours contracts. They provide transport by minibus for their workers from and too home. Judge Stout holds that the travel time is not “ time work “ for the purposes of the National Minimum Wage.

 

ABUSE OF PROCESS

June 27th, 2024 by James Goudie KC in Judicial Control, Liability and Litigation

In TINKLER v ESKEN (2024) EWHC 1490 (Ch) the defendant succeeded in an application to strike out a claim. The claim alleged an unlawful means conspiracy. It raised the same or very similar issues as those raised between the same parties in an earlier fraud claim. The strike out succeeded on two bases. First, the claimant had previously admitted that the conspiracy claim was parasitic on the fraud claim and that it would be an abuse of process for him to proceed with it if the fraud claim failed. A party can be bound by an admission of law in the same way that they could be bound by an admission of fact. To allow him to withdraw the admission would significantly prejudice the defendant and would not be in the administration of justice. Second, in any event, the conspiracy claim would be struck out as a collateral attack on the findings made in the fraud judgment. This was an abuse contrary to the HENDERSON v HENDERSON principle.

 

POSSESSION

June 27th, 2024 by James Goudie KC in Land, Goods and Services

In UNIVERSITY OF BIRMINGHAM v PERSONS UNKNOWN (2024) EWHC 1529 (KB) the Claimant is granted possession of part of its land that is being used as a protest camp. The order is to prevent persons unknown from entering and using the land. Acts of vandalism and intimidation had occurred there. Once a protest turned into a base account for criminal activity any licence to enter and use the land ceased to apply; para 51.

 

INTERPRETATION OF ARTICLEs OF ASSOCIATION

June 25th, 2024 by James Goudie KC in Capital Finance and Companies

In SYSPAL CAPITAL LTD v TRUMAN ( 2024 ) EWHC 1561 ( Ch) Roth J at paras 23-26 inc summarised the principles of interpretation by reference to the Supreme Court in WOOD v CAPITA )2017) UKSC 24 and in SARA & HOSSEIN ASSET HOLDINGS LTD v BLACKS OUTDOOR RETAIL LTD (2023) UKSC 2, and added that, when it comes to the background facts, the Articles of Association of a Company are in “ somewhat special category “ as compared to a private contract. As explained by Snowden J, as he then was, in RE EURO ACCESSORIES LTD (2021) EWHC 47 (Ch), approved by the Court of Appeal in VENTURA CAPITAL GP LTD v DNANUDGE LTD (2023) EWCA Civ 1142,  the process of interpretation to arrive at the meaning of a provision in a Company’s Articles of Association must concentrate on the natural and ordinary meaning of the words used, when viewed in light of the scheme and purpose of the Articles in general, any extrinsic facts about the company or its membership that would reasonably be ascertainable by any reader of the Company’s constitution and public findings at Companies House and commercial common sense.

 

COUNTY COURT APPEALS

June 25th, 2024 by James Goudie KC in Judicial Control, Liability and Litigation

In JARVIS v METRO TAXIS ( (2024) EWHC 1452 (KB) it is held that where a Circuit Judge in the County Court has allowed an Appeal against a District Judge’s decision refusing a claim, and goes on to rehear and dismiss the claim, an Appeal against the Circuit Judge’s decision lies to the Court of Appeal, and not to any other Court. That is because it is a second Appeal.

Save in contempt cases, Appeals from a Circuit Judge sitting in the High Court ordinarily lie to the High Court. Permission to bring such an Appeal can be given where the Court considers that the Appeal would have a reasonable prospect of success, or there is some other compelling reason for the Appeal to be held.

On the other hand however Appeals from County Court decisions that are themselves made on appeal lie only to the Court of Appeal. Moreover, permission to bring them is subject to more exacting requirements. These are that the Appeal has a real prospect of success or would raise an important point of principle or practice, or there is some other compelling reason for the Court of Appeal to hear it. In other words, parties in civil cases who have already enjoyed access to one appeal should be granted a further right of appeal only exceptionally.

 

CONTRACTUAL INTERPRETATION

June 24th, 2024 by James Goudie KC in Decision making and Contracts

In CANTOR FITZGERALD v YES BANK ( 2024 ) EWCA Civ 695 the Court of Appeal, at paras 33 and 34, reaffirms the principles to apply in construing a contract, in that case an engagement letter. The Court is required to consider the ordinary meaning of the words used in the context of (1) the words used in the context of the contract as a whole and (2) the relevant (i) factual and (ii) commercial background. This excludes prior negotiations. The objective is to identify the parties, but in an objective sense, That is what (i) a reasonable person (ii) having all the background knowledge which would have been available to the parties would have understood them to be using in the contract to mean. Interpretation is an iterative process. Rival interpretations should be tested against (i) the provisions of the contract and its commercial consequences.

Read more »

 

ABUSE OF PROCESS

June 21st, 2024 by James Goudie KC in Judicial Control, Liability and Litigation

In MUEEN-UDDIN v SSHD (2024) UKSC 21 the Supreme Court considers abuse of process.  The Courts have an inherent power to prevent their processes from being misused, or abused, in a way which would be manifestly unfair to one or more of the parties or would otherwise bring the administration of justice into disrepute.  The primary purpose of this power is to preserve public confidence in the administration of justice.  There are two well-established categories of abusive proceedings. The first is known as “Hunter abuse” following the House of Lords’ decision in Hunter v Chief Constable of the West Midlands Police [1982] AC 529.  The second is “Jameel abuse” following the Court of Appeal decision in Jameel (Yousef) v Down Jones & Co Inc [2005] EWCA Civ 75.

Hunter abuse arises where a claimant uses proceedings to mount a collateral attack on a final decision made by a court of competent jurisdiction in earlier proceedings.  A claimant who wishes to challenge a decision made against him should normally do so by appealing that decision.  The courts should not generally permit him to pursue new proceedings in order to re-litigate matters which he had a full opportunity to contest in the earlier proceedings.  Allowing this would give rise to a risk that the decisions in the two sets of proceedings would be inconsistent, bringing the administration of justice into disrepute.

Not every collateral challenge to earlier proceedings will amount to Hunter abuse. The Hunter principle only applies where the earlier proceedings were fair, and where they provided the claimant with a full opportunity to contest the court’s decision.

The Supreme Court rejects a submission that the court can consider matters relevant to Hunter and Jameel abuse together, so that even if neither type of abuse can be established on its own, considerations relevant to each of them can contribute cumulatively to the conclusion that a claim is an abuse of process. Hunter abuse and Jameel abuse protect different aspects of the public interest and have different rationales.  The considerations relevant to each principle cannot therefore simply be lumped together.

 

ENVIRONMENTAL IMPACT ASSESSMENT (EIA)

June 21st, 2024 by James Goudie KC in Planning and Environmental

Before planning permission can be granted for a development project which is likely to have significant impact on the environment legislation requires an EIA to be carried out.  In R (Finch) v Surrey County Council (2024) UKSC 20 the applicable legislation was contained in the Town and Country Planning (Environmental Impact Assessment) Regulations 2017, which requires an EIA to identify, describe and assess the likely “direct and indirect significant effects” of the project on the environment, including (among other factors) the impact on climate (for example, the nature and magnitude of greenhouse gas emissions).  The process of assessment must include public consultation.  The legislation does not prevent the planning authority from giving consent for a project that is likely to cause significant harm to the environment; but it requires the authority to reach a reasoned conclusion on the environmental impact and to take this conclusion into account in making its decision.

In this case a developer applied to Surrey County Council for planning permission to expand oil production from a well site at Horse Hill near Horley in Surrey.  The proposed project would involve the extraction of oil from six wells over a period of 20 years. The project comes within a category for which an EIA is compulsory (“Extraction of petroleum … for commercial purposes where the amount extracted exceeds 500 tonnes/day”).

The developer argued that, as regards the impact of the project on climate, the scope of the EIA should be confined to the direct releases of greenhouse gases from within the well site boundary during the lifetime of the project; and that the EIA need not include an assessment of the greenhouse gas emissions that would occur when the oil extract from the wells was ultimately burnt elsewhere as fuel. The council accepted this approach.  Its decision to grant planning permission for the project was therefore made without assessing or taking into account the emissions that will occur upon combustion of the oil produced.

The claimant, a local resident, applied for judicial review of the council’s decision.  She argued that the decision was unlawful because the EIA was required, but did not, include an assessment of the combustion emissions. By a three-to-two majority, the Supreme Court holds that the council’s decision was unlawful because the emissions that will occur when the oil produced is burnt as fuel are within the scope of the EIA required by law.

It is an agreed fact that, if the project goes ahead, it is not merely likely but inevitable that the oil produced from the well site will be refined and, as an end product, will eventually undergo combustion, and that combustion will produce greenhouse gas emissions.  It is not disputed that these emissions will have a significant impact on climate.  It is agreed that the amount of these emissions can be estimated using an established methodology; indeed, the council has provided such an estimate as part of its evidence in this case.  The issue is whether the combustion emissions constitute “direct or indirect … effects of the project” within the meaning of the EIA Direction and  2017 Regulations. If they are, they must be assessed as part of the EIA.

The Supreme Court is unanimous in rejecting the view that this question requires an evaluative judgment about whether there is a sufficient causal connection between the extraction of the oil and its eventual combustion, on which different planning authorities could reasonably take opposite views.  It is unreasonable to interpret the EIA Directive in a way that treats inconsistent answers to the question whether the combustion emissions are “effects of the project” as equally valid.

The majority of the Court considers this question to be one of causation to which, on the agreed facts, only one answer can reasonably be given. The emissions that will occur on combustion of the oil produced are “effects of the project” because it is known with certainty that, if the project goes ahead, all the oil extracted from the ground will inevitably be burnt thereby releasing greenhouse gases into the earth’s atmosphere in a quantity which can readily be estimated.

The EIA Directive does not impose any geographical limit on the scope of the environmental effects of a project that must be assessed. The council was therefore wrong to confine the EIA in this case to emissions expected to occur at the project site.  It is in the very nature of “indirect” effects that the may occur away from the source.  Moreover, the impact of greenhouse gas emissions on climate does not depend on where the release occurs.  The process of refining crude oil does not alter its basic nature or intended use and cannot reasonably be regarded as breaking the causal connection between the extraction of the oil and its subsequent combustion. Raw materials such as steel can be put to many possible uses, and the view might reasonably be taken that no meaningful assessment or estimate can be made of what emissions will ultimately result from its use.  Oil is a very different commodity.  There is no element of conjecture about what will ultimately happen to the oil; refining the oil does not change it into a different type of object (unlike the incorporation of a part in a motor vehicle or aircraft); and a reasonable estimate can readily be made of the emissions that will occur upon its inevitable combustion.

An argument that national planning policy is relevant to the scope of the EIA required by the EIA Directive is also rejected. The UK’s national policy of encouraging domestic production of oil and gas is relevant to the decision of the planning authority whether to grant permission for the project. But it does not dispense with the requirement to assess the environmental impact of the project or justify limiting the scope of that assessment before the planning decision is taken. The purpose of the EIA is to ensure that, whatever the decision taken, it is taken with full knowledge and public awareness of the likely significant environmental consequences.

Consequently, the council’s failure to assess the effect on climate of the combustion of the oil that would be produced from the proposed well site means that its decision to grant planning permission for the project was unlawful.

There was a powerful dissent from Lord Sales.

 

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