England and Wales Court of Appeal (Civil Division) Decisions

IN THE SUPREME COURT OF JUDICATURE
CIVIL DIVISION
ON APPEAL FROM THE HIGH COURT
QUEEN'S BENCH DIVISION
ADMINISTRATIVE COURT LIST
(Mr Justice Newman)

		The Royal Courts of Justice The Strand London Tuesday 2 July 2002

Tuesday 2 July 2002

1. LORD JUSTICE DYSON: This is an application for permission to appeal against the decision of Newman J on 4 March 2002, whereby Centerprise Trust Ltd ("Centerprise") was refused permission to apply for judicial review of a decision by Hackney Borough Council ("the council") to refuse to grant funding for a cultural diversity festival, known as Mare de Gras, which Centerprise wished to arrange in the autumn of 2001.
2. The background is that this festival had been funded by the council with a grant of £40,000 for each of the years 1998, 1999 and 2000. The starting-point for a consideration of this application is the report to the meeting of the Policy and Resources Committee of the council of 3 November 1997. This report recommended:

"That members agree to holding anti-racism celebratory events in 1998 and annually thereafter as proposed in paragraph 4, 5 and 6."

3. It also recommended:

"That funding of up to £40,000 be approved for 1998, and that officers identify a source of funding from approved budgets."

4. The proposals appear at paragraph 4 of the report and the subject of funding is dealt with at paragraph 6 in these terms:

"Appendix 1 sets out estimated budget for 1998. It can be seen that contributions from the Council would amount to 40% of the total cost of the event. It is important that a decision on the Council's contribution is made at this stage so as to enable the organisers to attract maximum match funding."

5. The report concludes with comments of the Borough Treasurer as follows:

"The proposals in this report require annual funding of £40,000 for which no provision currently exists. Resources will have to be identified during the 1998/19989 budget setting process."

6. On 22 March 2001 a meeting took place of a council Working Group on the Funding of Voluntary Organisations and Learning. A decision was taken to defer consideration of the future funding of the Stoke Newington and Mare de Gras festivals pending a report on the two festivals to the Regeneration Committee.
7. The next event which is said to have significance is a report of emergency action taken by the Councillors Grimble and Ollerenshaw, respectively the Chair and Vice Chair of the Regeneration Committee. The report is dated 26 April 2001 and is, on its face, taken as emergency action. It approved recommendations that funding be granted to the Stoke Newington Midsummer festival for 2001, but that it be refused for the Mare de Gras festival. The reasons for urgency were given in these terms:

"The [blank] festival [blank] requires an immediate decision on Council funding for 2001/02 in order to facilitate early planning and to secure much need match funding. Stoke Newington Midsummer festival is scheduled for early June 2001."

8. Dr Seray-Wurie submits on behalf of Centerprise that these reasons were doctored by Councillor Grimble.
9. Centerprise applied for a grant for Mare de Gras for 2001. It was refused by the council. In so doing the council applied criteria which it had issued for the first time in 2001. This was done in order to reduce the total grants made by the council because of its parlous financial situation. Councillor Nicholson, in his witness statement at paragraph 5, described what happened. He said:

"I was not involved in the Grants Assessment process or in the Appeals process. However on 8 August 2001 I was asked as Chair of the Regeneration Committee to approve the recommendations for grants to voluntary organisations made by the Grants Assessment Panel made under Standing Order 40(SO40) the Council's Emergency process. The report (attached) identified the process undertaken for the allocation of grants and contained recommendations for the allocation of grants to various organisations listed. A principal recommendation was 'that grants are awarded to all projects which scored 17 points and above as scheduled in Appendix 1, except those groups with significant reserves'. The claimant scored 19 point on one project and was awarded a grant on that project. For the second project, the Mare de Gras, the Claimant scored 8 points (as a result of various concerns) and was not awarded a grant. I upheld the recommendations of the Grants Assessment Panel on all the organisations as I considered the decision fair. The recommendations were based on an assessment by Council officers and the independent assessor from OPN."

10. At a meeting held between, amongst others, council representatives and Mr Amevor, who represented Centerprise, it was minuted:

"• HW [Helen White of the Community and Learning Committee of the council] informed the group that the Mare de Gras event had not been awarded with grant funding as their application did not meet the requirements of the scoring system.

• EA [Mr Amevor] requested information on how the panel assessed applications, how many festivals were awarded monies and whether all the festivals were put under the same scrutiny.

• EA mentioned that he met with Max Caller who assured him that the Hackney Mare de Gras would receive funding. EA felt that the event had been unfairly discriminated against and would be seeking legal advice."

11. On 20 August 2001 Mr Hook, Director of Community and Learning, wrote this letter on behalf of the council to Mr Amevor:

"As you will be aware, there has been a sharp reduction in the funds available to grant aid voluntary sector organisations within the Borough. In consequence of this it has been necessary to apply rigorous criteria -- of which you were advised through the guidance notes, sent to your organisation, earlier this year.

Although it will not be possible to offer your organisation any further funding for this current financial year we would wish to encourage all voluntary sector organisations to apply for next years funding round. Notes and guidance on the funding round for 2002/2003 will be issued in due course."

12. The letter then went on to refer to the right of appeal. Centerprise duly appealed. Mr Amevor presented the appeal on 18 October. On 8 November the council wrote saying that the appeal had been unsuccessful.
13. I now turn to the proposed grounds of challenge. The first head of challenge is based on an alleged legitimate expectation. The case is put in two ways on behalf of Centerprise. The first is based on the report to the meeting of 3 November 1997. It is said that, properly interpreted, this report contained an undertaking by the council that there would be annual funding of the Mare de Gras festival; that is to say, funding each year until that funding was terminated on the giving of reasonable notice. The case is that the peremptory cessation of funding altogether for the year 2001 was in breach of the legitimate expectation deriving from that report.
14. I cannot read the report in the way for which it is contended. Although it shows that it was proposed that the Mare de Gras festival would be held annually, the report merely recommended that funding of up to £40,000 be approved for 1998. It said nothing about any commitment to fund in future years. It seems to me that that is fatal to the first way in which Centerprise seeks to put its legitimate expectation point.
15. The second basis for the legitimate expectation is an express assurance or express assurances of future funding given by one or two councillors. As I have already said, at the meeting of 17 August 2001 Mr Amevor said that such an assurance had been given to him by Mr Caller. Mr Caller denies having given such an assurance in a witness statement prepared for the purposes of these proceedings. It now appears that the case advanced on behalf of Centerprise is that the assurance was not given by Mr Caller but rather was given by Ms Pat Andreou during a telephone conversation between her and Mr Amevor on 5 June 2001. In his witness statement, dated 18 February 2002, Mr Amevor says:

"With regard to paragraph 4 of the Order made by the Honourable Mr Justice Stanley Burnton on the 29th January 2002 it was Ms Pat Andreou the Defendant's Voluntary Sector Partnership Officer who told me during a telephone conversation that she had had an assurance from Mr Ian Hook the Director of Community and Learning that the Mare de Gras Festival would be funded by the Council. The telephone conversation took place in the first week of June 2001. Prior to the assurance given to me, I was asked by the Defendant to present a budget and to confirm the amount of Match-funding secured from other funders for the festival. I duty complied with the Defendant's request in that regard without any delay."

16. Ms Andreou denies having had any conversation in which she gave such an assurance: see the third witness statement of Evelyne Jarrett.
17. In my judgment there is no real prospect of Centerprise successfully establishing a legitimate expectation based on this evidence. I accept the submission of Mr Clayton QC that there is a real doubt as to the reliability of Centerprise's evidence on this point. It is a striking feature of it that the identity of the person said to have given the assurance has changed. Moreover, there is no documentary evidence supporting the assertion that an assurance was given. In any event, the nature of the assurance said to have been given is imprecise. How much funding? It is noteworthy that it is not suggested that there was a promise of up to £40,000. Finally, it is relevant to the prospects of the legitimate expectation being established that Centerprise does not say that it acted to its detriment in reliance upon the alleged assurance. There is no evidence, for example, of contractual commitments undertaken as a result of the assurance which, but for the assurance, would not have been undertaken.
18. I make two final points. First, complaint is made that the council has discriminated unfairly between Centerprise on the one hand and Stoke Newington on the other. It is said that, on a proper application of the council's published criteria, funding should have been given for Mare de Gras just as it was for the Stoke Newington Midsummer Festival. I have already referred to the evidence of Mr Nicholson to the effect that the Mare de Gras festival achieved only 8 points, well short of the 17 points' threshold required for funding. It is also relevant to point out, however, that Mr Nicholson deals with the two festivals specifically at paragraph 8 of his statement. Here he says that the decision to grant the Stoke Newington Midsummer Project funding was because the council had a contractual commitment to grant funding to the that Project. There was no similar contractual commitment in relation to the Mare de Gras Project.
19. The second point I make is with reference to the allegation I have already mentioned that Councillor Grumble doctored the report of 26 April 2001. I do not propose to deal with this allegation. It does not appear in the claim form nor in any of the evidence relied on by Centerprise. Councillor Grimble has had no opportunity to deal with the allegation and nor has Mr Clayton had the opportunity to take instructions on it. Although the allegedly doctored report was disclosed by the council in February 2002, the allegation was not made until made during the course of submissions made to me this morning.
20. I turn to the second ground of challenge. This is that there was bias on the part of the council in deciding to dismiss the appeal because Mr Manion was involved in the decision and he was unfavourably disposed towards Centerprise, so that bias on his part infected the decision of the council on the appeal.
21. Mr Manion has signed a witness statement in which he said at paragraph 5 that he explicitly excluded himself from the panel when it considered the Centerprise appeal "as I thought it was possible that they (Centerprise) would consider me biased against them." The identity of the councillors who did serve on the panel that heard Centerprise' appeal is dealt with specifically by Ms Jarrett at paragraph 3 of her second witness statement, dated 28 February 2002. The list of members does not include Mr Manion. It is clear that Mr Manion was on the panel of councillors appointed to hear appeals of this kind. That is not in dispute. The question is whether Centerprise has adduced any credible evidence to show that Mr Manion did participate in the appeal. In my judgment there is no such evidence. There is merely an assertion that he must have participated in the process, and a point is made that no minutes have been produced of the meeting at which the decision was taken by the appeal panel. Whatever the reasons may be for the absence of such minutes, I am not prepared to infer that they have been withheld because they would show that Mr Manion participated.
22. The third ground of challenge concerns the decision by the council to sell the property which is currently occupied by Centerprise and, I believe, leased from the council. There is no doubt that the council did decide to sell the property. The evidence discloses that this was a decision reached by the council in good faith as part of the stringent measures that it took to reduce its financial difficulties. The complaint that is made by Centerprise is that it was given no advance notice of the council's decision to sell, and it is submitted that there was procedural impropriety on the part of the council. There was, it is said a breach of the rules of natural justice, sufficient, arguably at least, to impugn the lawfulness of the decision to sell.
23. It was apparently conceded by Mr Amevor in the court below that this issue was a matter which engaged private law exclusively, and that there was no room for public law, having regard to the nature of the subject-matter. I would accept the submission made on behalf of Centerprise that there is nothing inherent in the decision itself which, as a matter of principle, excludes the possible operation of public law principles to it. I did not understand Mr Clayton to contend otherwise. There are circumstances in which a public law body such as the council may find that a decision which affects the private law rights of persons is susceptible to judicial review.
24. Having said that, it seems to me that the scope for the intervention of judicial review in decisions of this kind, which are essentially decisions relating to property, is comparatively limited. If a decision can be shown to be Wednesbury unreasonable, then the court will intervene. All that can be shown here is that the decision was taken without prior consultation with the occupying claimant. In my judgment there was no obligation on the part of the council to consult Centerprise before making its decision to sell the property. It is not certain even that the new owners will require vacant possession of the property. Be that as it may, I am not persuaded that this point, any more than the others, sought to be raised by Centerprise has any real prospects of success.
25. I would accordingly refuse this application.
ORDER: Application refused