Thoughts on Amenability to Judicial Review

The Court of Appeal in Holmcroft v KPMG upheld the Divisional Court’s judgment that KPMG was not amenable to judicial review on all the facts of the case, but differed sharply in its reasons for reaching that conclusion. Was its rationale any more convincing than that of the first instance court? Not really.

Two years ago, I wrote a piece about the judgment of the Divisional Court in the case of Holmcroft Properties v KPMGCan a Firm of Accountants be a Public Body?

The title question was rhetorical. The answer is yes because, regardless of the source of its powers, a body can be ‘public’ – and therefore capable of being judicially reviewed – to the extent that it exercises a public function. There is no special exception for big firms of accountants, or anyone else.

However, this obviously begs a further question. When, and in what circumstances, does someone exercise a public function?

On this I was critical of the Divisional Court – not so much because of the outcome on the particular facts of Holmcroft, but because of the inadequacy of the reasoning by which the court got there. Indeed the whole of the law in this area – the law relating to a body’s ‘amenability’ to judicial review’ – is inadequate at many levels.

Holmcroft was appealed, and we now have the decision of the Court of Appeal, in which the leading judgment was delivered by Lady Justice Arden, her last before taking her seat (as Lady Arden) in the Supreme Court. Might this resolve some of the problems with the first instance judgment?

Continue reading Thoughts on Amenability to Judicial Review

The Duty to Follow Policies (and its Limits)

If a public body adopts a policy about how it will exercise one of its functions, it must follow it.

This principle has been developed over the last 15 years in a series of cases brought against the Secretary of State for the Home Department. Initially it was regarded as an outworking of the doctrine of legitimate expectation (Saadi at [7]). More recently it has been treated as a freestanding ground of judicial review which is ‘a requirement of good administration‘ (Nadarajah at [68]) and ‘a basic public law right‘ (Lumba at [58]).

The full extent to which the duty has now been cut loose from its traditional moorings in legitimate expectation became evident last year in the Supreme Court case of Mandalia. In that case the claimant successfully relied on the Home Office’s failure to follow an internal policy – a ‘process instruction’ to civil servants – of which he neither had, nor could have had, any knowledge at the time when it should have been applied. Following Mandalia, even an unpublished policy is now binding.

The duty is qualified by another basic public law principle, that policies should not fetter discretion. If the circumstances of an individual case provide a ‘good reason‘ for doing so (Lumba at [26]) a public body may, and sometimes must, depart from its own policy.

Subject to this qualification, the requirement to follow existing policies has developed into an important obligation on public bodies. However, two recent cases expose some of the limits of reliance on policies as a ground of public law challenge.

Continue reading The Duty to Follow Policies (and its Limits)

The Article 50 Litigation – Why the UK Parliament Still Needs to Vote for (or against) Brexit

Edmund Burke, on being elected MP for Bristol, famously told his new constituents that ‘Your representative owes you, not his industry only, but his judgment’. This was his clever way of saying that he was going to make up his own mind about how to vote in the House of Commons, and not feel bound to do whatever the people of Bristol wanted.

The speech, made in 1774, has stood the test of time. It is the classic statement of an MP’s role in a representative democracy. And its sentiments are embodied in constitutional law – MPs have a duty to make up their own minds, even if they were given a clear message by the electorate in a referendum (see Moohan v Lord Advocate at [48]).

A lot of people who do not much like the idea of Brexit are placing a great deal of weight on this. They think that the EU referendum is not the end of the matter, that MPs still have to vote on whether the UK should leave the European Union, and that Parliament is in no way bound by the wishes of the majority as expressed in the referendum result.

This has led to the first piece of post-referendum litigation. But how far is it accurate?

Continue reading The Article 50 Litigation – Why the UK Parliament Still Needs to Vote for (or against) Brexit

Holmcroft v KPMG – Can a Firm of Accountants be a Public Body?

The ‘Big Four’ accounting firms are commercial organisations par excellence. And they are highly successful. They could be the poster children for globalised capitalism in the Twenty-first Century.

In that capacity, from time to time, their collective strength in certain product markets engages the attention of the competition authorities – as it did, for instance, in the UK Competition Commission’s inquiry into statutory audit services.

But competition law is about preventing the abuse of commercial power, and public law is about preventing the abuse of governmental power. These legal disciplines come from the opposite ends of the public-private spectrum. Are there any circumstances in which an organisation as intrinsically commercial as a major accounting firm can also be regarded as a public body and subject to the requirements of public law?

This was the question addressed by the Divisional Court in R (Holmcroft Properties) v KPMG. The case is revealing as to the courts’ approach to applying public law in a complex public-private environment, and in particular their failure to form a coherent view of how regulation operates.

Continue reading Holmcroft v KPMG – Can a Firm of Accountants be a Public Body?

Damages and the Competence of the Administrative Court

The award of damages is not a remedy traditionally available in judicial review. In public law proceedings, the purpose of a claim is to identify unlawfulness and bring it to an end, not to compensate those who have been affected by it.

In recent years, however, the non-financial purity of judicial review has been eroded by a number of developments. In particular, monetary compensation is now available in some cases where the source of the wrong was non-compliance with either EU law (Francovich damages) or the European Convention on Human Rights (under section 8 of the Human Rights Act 1998).

But does the Administrative Court, without any real track record in this area, have the competence to carry out an assessment of damages in a complex case?

Continue reading Damages and the Competence of the Administrative Court

The EU Referendum – Four Months to Go, Five Things We Learned

The government has announced that the UK will vote on whether to leave or remain in the European Union on 23 June. Aside from that date, here are five other things we learned about the referendum within the last ten days…

Continue reading The EU Referendum – Four Months to Go, Five Things We Learned

Drax v HM Treasury – How Green (or any other) Subsidies Can Be Withdrawn Without Notice

Renewable energy has been subsidised in the UK for at least 25 years. However, the nature, scope and level of the subsidy has been subject to significant change over time. In recent years, due to a range of fiscal and political pressures on the government, various support schemes have been either scaled back or abandoned.

Government subsidies provide an incentive to invest in commercial activities which would otherwise be uneconomic. That is their point. So what happens if a business, having made those investments in the expectation of a subsidy, finds that it is then withdrawn with little or no warning? Does it have any legal right to a notice period, or compensation in lieu of one?

This was the question considered by the High Court in the recent case of Drax v HM Treasury, which has important implications for business planning in any industry which currently benefits from government financial support.

Continue reading Drax v HM Treasury – How Green (or any other) Subsidies Can Be Withdrawn Without Notice