Lease of Land

January 28th, 2014

In refusing to offer a solicitor a new lease of her office premises a local authority had abused its powers.  So held the High Court in R (Trafford) v Blackpool BC [2014] EWHC 85 (Admin).  The stated reason for the refusal was that her firm had brought claims against the Council on behalf of clients seeking compensation for injuries alleged to have been caused by the negligence of the Council, predominantly in highways “tripping” type claims.

The Judge held that the Council had exercised its “wide discretion” under Section 123 of the Local Government Act 1912 for an improper purpose and was “fundamentally tainted by illegality” on that basis; and that the decision was both Wednesbury unreasonable and procedurally unfair.

The Council’s main defence was that its decision was not amenable to judicial review.  The issue was as to whether or not, and if so in what circumstances, a public body acting under statutory powers in deciding whether or to not to enter into, renew or terminate a contract will come under public law duties, and if so which ones.  Having reviewed the authorities, the Judge concluded that the decision was in principle amenable to judicial review.  He stated:-

“55.    Having considered these authorities my conclusions are as follows:

(1) In a case such as the present, involving a challenge to a decision of a public body in relation to a contract, it is necessary to consider:

(a) by reference to the contract in question, to the relevant statutory power, to the statutory framework (if relevant), and to all other relevant matters, whether or not, and if so to what extent, the defendant is exercising a public function in making the decision complained of;

(b) whether, and if so to what extent, the grounds of challenge involve genuine and substantial public law challenges to the decision complained of, or whether, and if so to what extent, they are in reality private law challenges to decisions made under and by reference to the terms of the relevant contract.

(2) 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 will nonetheless normally be entitled to raise genuine and substantial challenges based on fraud, corruption, bad faith, and improper motive (in the sense identified by De Smith of the knowing pursuit of an improper purpose).

(3) The extent to which a claimant will be entitled to raise genuine and substantial public law challenges beyond those limited classes will depend on a careful analysis of all of the relevant circumstances so as to see whether or not there is a relevant and sufficient nexus between the decision in relation to the contract which is challenged and the grounds complained of.”

 

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