On 5 February 2016 HMG has issued (1) a Consultation Paper on “Limiting Public Sector Exit Payments”, and (2) a Guidance Note on “Public Sector Pay and Terms”.
ECHR AIPI
January 29th, 2016 by James Goudie KC in Human Rights and Public Sector Equality DutyIn R (Skelmersdale Limited Partnership) v West Lancashire BC [2016] EWHC 109 (Admin) Jay J summarised the case law as follows: (1) AIPI guarantees in substance the right of property; (2) AIPI comprises three distinct rules; (3) The first, of a general nature, lays down the principle of “peaceful enjoyment of property”; (4) The second covers “deprivation of possessions” and subjects it to certain conditions; (5) The third recognizes that States are entitled, amongst other things, to control the “use of property” in accordance with the “general interest”; (6) The second and third rules, which are concerned with particular instances of interferences with the right to peaceful enjoyment of property are to be construed in the light of the general principle laid down in the first rule; (7) In a deprivation of possessions case, the infringement of the AIPI right will be justified only in “exceptional circumstances”, in the absence of payment of compensation; (8) In a control of use case, the broad question is whether a “fair balance” has been struck between (i) the private interests of the proprietor and (ii) the general public interest; (9) In the event that a fair balance has not been struck without reference to it, the presence or absence of compensation is a relevant factor; (10) The State is allowed a “wide margin of appreciation” in the field of land development and town planning; (11) The issue of “proportionality” is not hard-edged, but requires a broad judgment of where the fair balance lies; (12) The Court will intervene only if the interference is deemed to be “manifestly disproportionate”; and (12) When assessing proportionality under AIPI, a measure is not rendered disproportionate merely by reason of there being a “less intrusive way” of achieving the same objective.
Liability orders for non-domestic rates
January 29th, 2016 by James Goudie KC in Council Tax and RatesWhen is an hereditament “wholly or mainly used for charitable purposes”? In South Kesteven DC v Digital Pipeline Ltd [2016] EWHC 101 (Admin) a Divisional Court set out the following propositions: (1) The test is not whether the activity being conducted on the premises is wholly or mainly charitable; it is whether the premises are being used wholly or mainly for charitable activity. (2) If, as a matter of fact, the premises are being used wholly or mainly for charitable purpose, it matters not that they could have been run more efficiently or that strictly part only of the premises need have been used; the test has to be applied to the facts as they are, not as they might have been. (3) When determining whether the charitable exemption from rates applies, it is immaterial that the purpose of an arrangement between landlord of business premises and charity tenant is to avoid or reduce the payment of rates.
Flood risk management
January 29th, 2016 by James Goudie KC in Environment, Highways and LeisureIn the test case of Robert Lindley Ltd v East Riding of Yorkshire Council (2016) UKUT 6 (LC) a farming company claimed compensation from the Council under Sections 14 and 14A of the Land Drainage Act 1991 after part of its carrot crop was destroyed when floodwater was pumped out of a nearby village. The Council was lead local flood authority and a risk management authority. Nonetheless, it submitted that it was not liable, because (1) flood risk management work had to be of a permanent nature and the pumping operation had been temporary and (2) the crop was damaged when the pumping was carried out by the Environment Agency (“the EA”) and the Fire Service. Both submissions failed. As to the first, flood risk management work is not limited to permanent work: Paragraph 93. As to the second, the relevant risk management authorities falling within the Flood and Water Management Act 2010 were the Council (as the lead local flood authority) and the EA. The Fire Service did not fall within the definition. As the lead local flood authority, the Council had failed to carry out its duty under the 2010 Act to investigate who were the relevant risk management authorities and whether they were exercising flood risk management functions. If it had carried out that duty, there might have been less confusion as to what powers were being exercised. On proper analysis, the EA had been co-operating with and assisting the local authority. It had provided the pumps in response to the local authority’s request. The local authority had paid for all the pump fuel, including for the period when the EA was on site in the village. Very little supervision of the pumps had been required other than to ensure they had sufficient fuel. On those facts, the pumps had been on loan to the local authority from the time they were delivered. The local authority had exercised its powers to carry out the work and was liable for the damage caused.
Legal Aid
January 29th, 2016 by James Goudie KC in Judicial Control, Liability and LitigationTo obtain civil legal aid to bring proceedings against a public authority the applicant must show that the proposed action is within the scope of LASPO, the Legal Aid, Sentencing and Punishment of Offenders Act 2012. One provision that may be relied upon is paragraph 1 of Schedule 1. This applies in the case of alleged “abuse by a public authority of its position or powers”. What this means has been considered by the Court of Appeal in Director of Legal Aid v R (OTA Sunita Sisangia) (2016) EWCA Civ 24. Sub-paragraph (4) of paragraph 1 was held not to be an exclusive or comprehensive definition. The fact that the expression cannot be given a hard-edged definition does not mean that the concept itself is meaningless. Moreover, the ingredients of abuse of power have been expressed in appellate cases, including by the House of Lords in R (Pulhofer) v Hillingdon LBC [1986] AC 484 at 518. “Abuse of position or power” is a recognized judicial concept. Like many other public law concepts, it is “both flexible and context-specific”.
PROPORTIONALITY
January 27th, 2016 by James Goudie KC in Judicial Control, Liability and Litigation
The Supreme Court in Samin v Westminster City Council, Mirga v SSWP [2016] UKSC 1, was concerned with the rights of residence in the UK and benefit rights in the UK of “persons from abroad”, specifically EU nationals (from Austria and Poland), pursuant to the Immigration (European Economic Area) Regulations 2006, SI 2006/1003 (“the EEA Regulations”), made under EU Directive 2004/38/EC. Mr Samin was born in Iraq in 1960. In 1992 he and his family were granted asylum in Austria. He was granted Austrian citizenship the following year. He then became estranged from his wife and children and came to the UK in December 2005 Since then he has lived in the UK alone. He is socially isolated. He suffers from poor mental and physical health.
Mr Samin occupied private accommodation until 2010. He then applied to Westminster City Council (“the Council”) for housing under the homelessness provisions of the Housing Act 1996 (“the Housing Act”). The Council decided that he was “a person from abroad who is not eligible for housing assistance” within the meaning of Section 185(1) of the Housing Act, because he did not have the right of residence in the UK under EEA Regulations. That decision was affirmed in the Central London County Court, whose decision was in turn upheld by the Court of Appeal. The Supreme Court unanimously dismissed his appeals.
The Supreme Court held first that the domestic law did not infringe Mr Samin’s EU Treaty rights. It held second (paragraphs 58-70) that there was no lack of proportionality on account of individual consideration not having been given to the individual case. The important point of principle is that a proportionality exercise is not required in every case where the right of residence and/or the right against discrimination under the EEA Regulations is invoked.
On the same day, 27 January 2016, the Supreme Court also gave Judgment in Youssef v SSFCO [2016] UKSC 3, in which the issues that arose included the standard of review. Lord Carnwath, giving the Judgment, said, having referred to Kennedy v Information Commissioner [2015] AC 455 and Pham v SSHD [2015] 1 WLR 1591:
“55. In Keyu v Secretary of State for Foreign and Commonwealth Affairs [2015] UKSC 69; [2015] 3 WLR 1665 (decided since the hearing in this appeal) this court had occasion to consider arguments, in the light of Kennedy and Pham, that this court should authorise a general move from the traditional judicial review tests to one of proportionality. Lord Neuberger (with the agreement of Lord Hughes) thought that the implications could be wide-ranging and “profound in constitutional terms”, and for that reason would require consideration by an enlarged court. There was no dissent from that view in the other judgments. This is a subject which continues to attract intense academic debate … It is to be hoped that an opportunity can be found in the near future for an authoritative review in this court of the judicial and academic learning on the issue, including relevant comparative material from other common law jurisdictions. Such a review might aim for rather more structured guidance for the lower courts than such imprecise concepts as “anxious scrutiny” and “sliding scales”.
- Even in advance of such a comprehensive review of the tests to be applied to administrative decisions generally, there is a measure of support for the use of proportionality as a test in relation to interference with “fundamental” rights (Keyu paras 280-282 per Lord Kerr, para 304 per Lady Hale). Lord Kerr referred to the judgment of Lord Reed in Pham (paras 113, 118-119) where he found support in the authorities for the proposition that:
“… where Parliament authorises significant interferences with important legal rights, the courts may interpret the legislation as requiring that any such interference should be no greater than is objectively established to be necessary to achieve the legitimate aim of the interference: in substance, a requirement of proportionality.” (para 119)
See also my own judgment in the same case (para 60), and those Lord Mance (paras 95-98) and Lord Sumption (paras 105-109), discussing the merits of a more flexible approach in judging executive interference with important individual rights, in that case the right to British citizenship.
- On the other hand, in many cases, perhaps most, application of a proportionality test is unlikely to lead to a different result from traditional grounds of judicial review. …”
Lord Carnwath further observed, in paragraph 61:
“… Judicial review is a discretionary remedy. The Court is not required to ignore the appellant’s own conduct, or the extent to which he is the author of his own misfortunes. …”
Consultation
January 15th, 2016 by James Goudie KC in Decision making and ContractsThe Government has replaced its Code of Practice on Consultation issued in July 2008. The new guidance includes that “consultations should last for a proportionate amount of time”, rather than prima facie for a 12 week period.
Reducing the risk of Contractual Non-Performance
January 15th, 2016 by James Goudie KC in Decision making and ContractsA contracting authority must verify the suitability of its potential service providers. That verification is intended, in particular, to enable the authority to ensure that a tenderer, if successful, will have the means necessary to perform the contract, and to enable the authority to be confident that, throughout the period of the contract, the successful tenderer will be able to use whatever resources it relies upon, including the capacities of other entities.
That gives rise to two questions: first, as to what proof the authority can call for that these resources will be at the economic operator’s disposal; and, second, as to the nature of the links between that operator and those other entities. EU policy is that the tenderer is free to choose the legal nature of the links it intends to establish with those other entities.
In a case from Latvia, C-234/14, the ECJ has on 14 January 2016 held that Directive 2004/18/EC precluded a Latvian local authority from requiring a tenderer, which relied on the capacities of other entities for the performance of the contract concerned, to establish links of a precise legal nature with those entities, so that only those particular links were capable, in the eyes of the authority, of proving that the contractor does in fact have the resources necessary to perform that contract. The municipality required the tenderer, before the award of the public contract, to conclude a cooperation agreement with those entities or to set up a partnership with them. That requirement was ruled impermissible.
Lessons from the NHS
January 11th, 2016 by James Goudie KC in Decision making and ContractsCases involving NHS bodies continue to be instructive for local authorities. See R(QSRC Ltd) v NHS Commissioning Board [2015] EWHC 3752 (Admin) on the ability to enter into an interim contract pending the completion of a procurement exercise, even if (paragraph 107) the procurement exercise has been considerably delayed, provided (paragraph 103) that there is preference of an existing provider over other potential providers; and Keep Wythenshawe Special Ltd v NHS Central Manchester CCG [2016] EWHC 17 (Admin), at paragraphs 62-79 inclusive, on how a consultation exercise should be structured, the manner in which it should be carried out, when there should be a re-consultation, and influences on the requirements of fairness.
Termination of contract for breach
January 6th, 2016 by James Goudie KC in Decision making and ContractsIn BT Cornwall Ltd v Cornwall Council [2015] EWHC 3755 (Comm), a services provider brought a claim against the local authority and other public sector bodies for an injunction to prevent the termination of a potentially long duration £160 million agreement between them. The claim failed. The agreement covered services such as health, transport, communications and public safety. It also provided for the creation of new jobs for local residents.
The agreement contained a clause entitling the local authority to waive key performance indicator scores resulting from service failures if it was satisfied that a remedial plan was in place. There were substantial problems with performance. A number of key performance indicators fell consistently below target level. A backlog of work accrued.
The parties established an executive forum aimed at resolving the issues. Later, however, the local al authority stated its intention to terminate the agreement for material breach. It also claimed that the service provider’s failure to meet its annual jobs guarantee gave rise to an obligation to provide a remediation plan, which it had failed to do. The service provider claimed that a large number of faults had been caused by the local authority. It also claimed that a separate agreement had been entered into for the backlog to be cleared, with the implication that the key performance indicator results which fell below breach level would not be used to justify termination, and that the local authority was in any event estopped from relying on breaches in terminating for material breach.
Knowles J held that the failure to create new jobs resulted at least in part from the local authority’s failure to secure a health contract, which would have accounted for 70 new jobs. There was no contractual requirement for a remediation plan. Accordingly, the service provider was not in breach of the agreement in that respect. Moreover, there was no evidence that the waiver clause in the agreement had been exercised nor was there any reason to imply a waiver. The service provider was contractually obliged to resolve the backlog and was not entitled to protection from the consequences of its failure to do so.
Knowles J further held that there was no basis for a case on estoppel or affirmation. The fact that the local authority was prepared to engage with the executive forum and to work collaboratively with the service provider was not to be held against it and did not signal that it would refrain from taking action under the agreement. There had been no material delay on the local authority’s part, and neither its actions nor the passage of time were to be taken as an election not to terminate for material breach.
In conclusion, the service provider had failed to provide the service it had promised to the required standard. There was no capriciousness or bad faith on the local authority’s part in expecting it to clear the backlog or take the contractual consequences if doing so resulted in further breaches of the key performance indicators. Accordingly, the service provider was in breach of the agreement such as to justify termination.