England and Wales High Court (Administrative Court) Decisions

Asha Foundation, R (on the application of) v The Millennium Commission [2002] EWHC 916 (Admin) (14th May, 2002)

IN THE HIGH COURT OF JUSTICE
QUEEN’S BENCH DIVISION
ADMINISTRATIVE COURT

		Royal Courts of Justice Strand, London, WC2A 2LL
		14th May 2002

Mr Justice Lightman:

INTRODUCTION

1. This is an application made with the permission of Crane J by a charity, The Asha Foundation (“Asha”), for judicial review of the decision made on the 27th June 2001 (“the Decision”) of the Defendant, the Millennium Commission (“the Commission”) in its fifth round of capital grants (“the Fifth Round”) to refuse an application by Asha for a capital grant. The application focuses upon the propriety of the decision-making process and the duty of the Commission to give reasons for the Decision and the adequacy of those reasons.

STATUTORY SCHEME

2. The Commission is a body corporate established under Section 40 of the National Lottery Act 1993 (“the Act”). Where in this judgment I refer to sections and schedules I refer to sections and schedules of the Act. Section 40 and Schedule 6 provide that the Commission shall consist of nine members appointed on the recommendation of the Prime Minister, two of whom shall be Ministers of the Crown and one of whom shall be nominated by the Leader of the Opposition, and that the Commission may appoint staff. Section 21(2) provides for payments by the Secretary of State into the National Lottery Distribution Fund (“the Fund”). Section 22 provides that 20% of the balance held in the Fund (after payments made under Section 31) shall be allocated for expenditure on projects to mark the year 2000 and the beginning of the third millennium. Section 23(5) provides that this money shall be held for distribution by the Commission. Section 24 provides for payment of the money to the Commission and Section 25(1) provides for the Commission to pay out the money for the purpose stated. Section 26(1) provides that the Commission shall comply with any directions given to it by the Secretary of State as to matters to be taken into account in determining the persons to whom, the purposes for which and the conditions subject to which it distributes the money. Section 41 provides as follows:

“(1) The Millennium Commission may make out any money they receive grants to fund or assist in the funding of such projects at the Millennium Commission considered appropriate to mark the year 2000 and the beginning of the third millennium.

...

(3) The Millennium Commission may do anything that they consider desirable for enabling them to determine the projects in respect of which grants under this section are to be made.”

3. Pursuant to Section 26(1) on the 20th June 1994 the Secretary of State issued directions (“the Directions”) to the Commission which (as amended by further directions dated the 3rd August 1998) so far as are material read as follows:

“...2. The Millennium Commission shall take into account the following matters in determining the persons to whom, the purposes for which and the conditions subject to which is distributes money under section 25(1):

(B) the need to ensure that money is distributed under section 25(1) for projects which promote the public good (including the widening of public access) or charitable purposes and which are not intended primarily for private gain;

(D) the viability of projects and in particular the need for resources to be available to meet any running and maintenance costs associated with each project for a reasonable period, having regard to the size and nature of the project;

(E) the need to require an element of partnership funding and for distributions in kind from other sources, commensurate with the reasonable ability of different kinds of applicants, or applicants in particular areas to obtain support;

(H) the objective of ensuring that major projects are supported in each country of the United Kingdom.”

I shall refer to the above as “the Statutory Considerations”.

4. The effect of the Direction is to require the Commission at all stages of its decision-making process to take the Statutory Considerations into account as relevant considerations. It does not however preclude the Commission taking into account other considerations or determining the appropriate weight to be given to each of the various relevant considerations.
5. When in 1999 the Commission invited applications in respect of the Fifth Round, in exercise of its powers under Section 41(3) the Commission prepared an Application Pack (“the Pack”) setting out the criteria and the guidelines which the Commission would apply in the competition for the award of grants. I set these out in paragraphs 6-8 of this judgment and refer to them as “the Commission Criteria and Guidelines”.
6. The Pack informed applicants as follows:

“Criteria for Millennium Projects

The grants we are offering are for Capital Projects. Applications must meet a set of key criteria. The key criteria for a millennium project to be eligible under this round are:

It must reflect the aspirations and achievements of ethnic minority communities.

It must enjoy public support

It must make a substantial contribution to the life of the community it is designed to serve

In making its choice between different proposals seeking funding for millennium projects, the Commission seeks projects which:

Look back over this millennium or forward into the new one

Will be seen by future generations as marking a significant moment in their national or local history

Are of high architectural design and environmental quality

Include partnership contributions to demonstrate the real support of the local community. A partnership contribution of at least 50% would normally be required

Would not be possible without Millennium Commission funding

Would not normally be supportable from public funds of fall within the scope of another Lottery distributor.

Who can apply?

Only projects which reflect the aspirations and achievements of the UK’s ethnic communities will be eligible....

If you have previously submitted projects for consideration by the Commission you may still submit an application under this new funding round. You should, however, consider carefully the form and content of your project in the light of the Commission’s comment on your previously unsuccessful application.”

7. Provision was made for a two stage application process. At the first stage the Commission were to consider whether to make interim grants to eligible applicants who needed such grants to progress their applications to the second stage. At the second stage there was to be a detailed examination of the eligible applications. The Pack went on to say:

“What happens next?

...2. Offer of grant

When the Commission’s detailed examination of your 2nd stage application is completed, we will decide whether to make you an offer of grant. If your application is rejected, the Commission will write to you explaining why. Once a grant has been offered to projects, a further grant contract will be negotiated. No payment will be against the full project until a grant contract is signed and any necessary conditions contained therein are fulfilled.”

8. In Annex C of the Pack the Commission spelt out how it would assess projects. The relevant part of this annex reads as follows:

“The questions that the Commission will need to be satisfied on when considering your proposed project include the following:

How the application meets the Commission’s criteria for millennium projects, described earlier in this guidance

The degree to which the application will benefit the public good

Whether the application is mainly for capital expenditure, within the threshold levels indicated

The extent of partnership contributions to the project

The long term viability of the project and the ability of the applicant to secure the long term running costs of the project

The ability of the project to achieve high standards of design and construction/implementation

The date upon which the project will become operational, and the effectiveness of the management structure

The ability of the team to bring the project to completion and maintain it thereafter

Surety of costs for capital and revenue

The state of readiness of the project to progress

The extent to which the project reflects the achievements and/or aspirations of the UK’s Ethnic Minority Communities.”

9. The Commission Criteria and Guidelines spell out and expand upon the provisions of the Direction and they operate to give rise to a legitimate expectation on the part of applicants that they will (in effect) be the rules of the competition to which the Commission will conform.

ASHA

10. Asha is a charity dedicated to the project (“the Project”) of establishing a Centre or Museum (to be called the Asha Centre) of Immigration celebrating and teaching the history of immigration into this country of the adherents of the many faiths to be found here, telling the story how Britain became a multi-cultural society and describing the beliefs of the nine major religions of modern Britain. On the 12th December 1997 during the period leading to the earlier third round of capital grants, Asha approached the Commission for a grant. A number of meetings and exchanges followed between the Commission and Asha. Not surprisingly the Commission clearly regarded the vision of the Project as very exciting. That has been its attitude at all times thereafter. It has publicly supported it. Its concern however has at all times been as to its prospects of realisation.
11. On the 21st December 1998 the Commission approved a conditional grant of £10 million for the Project and on the 14th December 1999 the Commission made an interim grant of £500,000 as seed cord funding. The conditions attached to the grant were not satisfied and on the 13th December 2000 the Commission decided to determine the conditional offer and demand repayment of the part of the interim grant (namely £352,471.24) which had already been paid. The reasons for doing so were that the Commission remained unsatisfied on four points: (a) that the Project “would be delivered”; (b) that there was the requisite co-funding; (c) viability; and (d) public support.
12. The Commission however informed Asha that the Fifth Round was pending which was intended to support capital projects reflecting the achievements and aspirations of the ethnic minority communities of the UK, that the application process was competitive and that if Asha applied its application would be appraised alongside other applications received. Asha applied for a grant of £10 million in respect of the capital costs of the Project which totalled £21.88 million. There were twelve applicants for grants applying for a total of £36.6 million. Asha’s was by far the highest grant applied for. The budget for this round was £19.4 million. There was accordingly intense competition between the applicants. Asha’s application was evaluated afresh and on its merits.
13. By the beginning of April 2001 the Commission had examined Asha’s application in detail. This process threw up a list of 25 questions and queries which were passed to Asha on the 2nd April 2001. Asha replied on the 5th April 2001. On the 4th May 2001 representatives of Asha met a Commissioner, Lord Glentoran, and staff of the Commission. On the 9th May 2001 the Commission met to review all the Fifth Round applications, and on the 11th May 2001 sent a list of 36 further questions to which Asha replied on the 25th June 2001. One matter to be considered was the fact that Asha had entered into a conditional contract for the purchase of a proposed site for the Asha Centre, but a dispute had since arisen between Asha and the vendor leading to litigation on the issue when Asha was entitled to specific performance of that contract.
14. The Commission instructed external consultants (DTZ) to appraise the applications and prepare a detailed appraisal report (“DAR”). This they did and the Commission staff produced summaries of them for consideration by the Commission. Ahead of the crucial meeting of the Commission on the 27th June 2001, the staff placed before the Commission these summaries of the DAR; a report covering the broader issue of the Fifth Round applications and comparing them; supporting documentation submitted by Asha and notes by Mr O’Connor, (the Director of the Commission) on particular issues which needed to be addressed and (of particular relevance in this case) a note on Asha (“the Note”).
15. The Note (so far as material) read as follows:

“1. Commissioners will be familiar with the proposal put forward by the Asha Foundation. Asha first applied to the Commission in December 1997 and they were awarded a conditional grant of £10m in November 1998. However despite considerable efforts and significant progress, Asha failed to meet the conditions to the satisfaction of Commissioners and the offer of grant was withdrawn in November 2000. The principle concerns were the absence of co-funding and concerns about the project’s viability.

2. The application before the Commissioners today is a new application made under the fifth funding round for £10m against a total capital cost of some £22m albeit that it is difficult at this stage to know what the true costs would be.

3. The Commission has repeatedly made it clear that it supports the Asha Foundation’s aims of contributing to better understanding and harmony between the races and religion’s [sic] in the UK. The aims of the project have won widespread backing from religious leaders from many faiths and from diverse cultural groupings - including the Caribbean Advisory Group. Opinion polls carried out by Asha in the wider Harrow areas have shown support for the project. However we cannot attest to the representative nature of these polls. The local Council and the MP were originally supportive but have changed their position in the light of the possibility that the Asha project might not be built on all of the seven acres of a site at Honeypot Lane as they had originally understood but only on two acres with five being sold on for development. There is also strong opposition from two local residents’ associations....

18. My conclusion is that Commissioners could support this project if they believe that the vision and its chance of being delivered in a sustainable way offer a better realisation of their aspirations for Round 5 budget. However it would be very high risk as there is a real possibility that the full match funding would not emerge, or only emerge very late, and in all likelihood the project would remain controversial in Harrow.”

16. The papers prepared for the Commission made recommendations based purely on appraisal of risk. Mr O’Connor explains this in paragraph 111 of his statement of evidence:

“... The Commission papers for Round five applications fell into three groups - those which recommended grant, those which did not recommend grant but did not recommend rejection, and those which recommended rejection. These recommendations were based purely on an appraisal of risk resulting from the DAR. They did not take into account wider considerations which were properly the concern of Commissioners, for example their view of the significance of this application as part of the Commission’s wider portfolio, or the degree to which the possible outputs of the project justified a higher level of risk than might normally be taken. For this reasons, no analysis of project benefits was undertaken. This was normal practice and the Commissioners were aware of the basis on which the papers were prepared. The recommendation of the Commission paper was that Asha’s application be rejected.”

17. At the meeting the Commission decided to make grants to 10 of the applicants (who did not include Asha) totalling £23.6m, to pay for which the Commission resolved to allocate £4.2m from the contingency budget. The Minutes of the Commission’s deliberations (so far as material) read as follows:

“6.6 ROUND 5 GRANT DECISIONS

Mr O’Connor introduced the papers. Round 5 had been launched last year. The budget was £20m which was made up of £10m additional income obtained for the purpose as a result of an appeal by the former Chairman to the Prime Minister and colleagues and £10m which had become available following the withdrawal of grant from the Asha Project. From its inception the Commission had aspired to a reasonable spread of lottery money. Geographically the distribution of Commission money had been reasonable, although some areas had fared better than others. However, the Commission had also recognised the importance of supporting project which reflected the nation’s diversity. The Commission had therefore decided to seek applications which marked the contribution of ethnic minority communities.

Many of the projects before the Commission today were relatively high risk but they were risks in areas which were familiar to the commission. Delivering the project would need steady support from the Commission and realism and hard work by the applicants....

The applicants before the Commission were seeking £37m, but the budget for the round was only £19.4m - what remained of the £20m budget after financial support for some application development work.

Lord Dalkeith asked for general comments before the Commission reviewed the individual applications....

MC/E/7025 The Asha Centre

This was a project to build a multi-use, multi-cultural centre for leisure, education and community activities designed to promote multi-cultural understanding. The project was seeking grant of £10m. Mr Alexander said that the Commission had been seeking to obtain additional information in response to Commissioners’ queries following the May meeting. Some information had been received the previous day and had been assessed but it was not sufficiently significant to make a major change to the assessment in the circulated Commission papers. A letter to Commissioners from the project dated 25 June along with supporting papers, had been tabled together with a note from the Director. Commissioners were given the opportunity to examine letters of support and opposition, some of which had arrived recently, which the Commission had received.

Mr O’Connor drew attention to the advice set out in his note dated 26 June. He reiterated that the Commission could fund this project although it would be high risk. On co-funding he stressed that the Commission’s legal advisors gave Asha a 70% chance of winning their current action against PACE for possession of the site and should they succeed, they would have a significant asset to use towards co-funding.

Mrs Donovan agreed with Lord Glentoiran and did not feel that the project should be supported. Commissioners accepted that the project might not be significantly more risky than some others which they had provisionally accepted but they were less attracted by this application than by others which they had considered. There was strong competition for funds and other projects, particularly the Derby multi-faith centre, had some comparable aims to Asha.

The application was rejected....

Lord Dalkeith reminded Commissioners that the budget for this round was £19.4m, so the current allocated exceeded the budget by £4.2m and did not allow any remainder for contingency. Staff had made the point that these were high risk projects and some contingency might be prudent. However at the beginning of the meeting, Commissioners had reviewed the lifetime budget and been told that there was a £14m unallocated contingency and that interest income assumptions had been kept deliberately low. Commissioners felt that these were significant projects and should be supported as far as possible but they also acknowledged the need for a significant proportion of the contingency budget to be reserved for later use.

Commissioners agreed to allocate an additional £4.2m from the contingency to the Round 5 budget and noted the lack of a specific Round 5 contingency.

On that basis the list of applications provisionally approved were formally agreed (see table above)....”

18. By letter dated the 28th June 2001 (“the June Letter”) the Commission informed Asha of the Decision. This June Letter read as follows:

“I regret to advise you that after careful consideration the Commission did not choose to provide a grant for the Asha Centre Project. In the light of the competition the Commissioners decided that your application was less attractive than those before them. Your application for Round 5 funding has therefore been rejected.

The Commission will not be making any press announcement about rejected applications at this stage.

I know that the Commissioners’ decision will come as a disappointment to you. Should you wish to discuss this letter, please contact me at the Millennium Commission.”

19. Asha sought further explanation for the Decision and this led to a letter from the Treasury Solicitor dated the 27th July 2001 (“the July Letter”) which read as follows;

[1] “I refer to your letter of 11 July to the Millennium Commission. By your letter you sought further explanation of the reason given by the Commission for its decision to reject Asha’s application for grant, notified to Asha on 28 June. I am instructed to reply as follows.

[2] By section 41 of the National Lottery Act 1993, the Millennium Commission are empowered to make grants to fund or assist in the funding of such projects as the commission consider ‘appropriate to mark the year 2000 and the beginning of the third millennium’. The commission’s decision in respect of the application for funding made by the Asha Foundation was an exercise of this power.

[3] This was the fifth round of applications for grants and, in terms of the funding allocated for distribution, it was substantially over-subscribed by applications that were, in terms of the appraisal criteria applied by the Commission (and referred to below), eligible. Asha’s application was one of these. The Commission was thus required to exercise its judgment as between the projects represented in those applications.

[4] As outlined in Annex C of the 5th Round applications documents, the Commission assessed the applications before them against the key criteria published in that document, and issues examined included; public good; identified co-funding and proposals for meeting co-funding deficits; project viability; ability to achieve high standards of design and construction/implementation; programme and management structure; capability of project team in relation to the project to be delivered; robustness and realism of budget; readiness to progress; and the extent to which the project reflected the achievements and/or aspirations of the ethnic minority communities.

[5] The appraisal was made entirely on the basis of information supplied by the applicants.

[6] The results of the appraisal were before the Commission when it considered its decision and were duly taken into account. In relation to Asha, I can confirm that the Commission was made aware that, were it so minded, it could offer Asha a grant, although it was also made aware that there appeared to be significant risks in taking the project forward.

[7] The Commission proceeded as, and in the terms that, section 41 requires, to form its view as to the comparative merits of each eligible project for the purpose of marking the year 2000 and the beginning of the third millennium, taking into account the Commission’s key criteria and having regard to the geographical and cultural equity of grant distribution. Against these considerations the Commission preferred 10 of the applications before them on the day over those of Asha and one other. The decision to reject the applications of Asha and that other followed....”

(I have added paragraph numbers to the July Letter for ease of reference later in this judgment).

20. In paragraph 4 of his witness statement dated the 16th January 2002, Lord Dalkeith, one of the members of the Commission who attended the meeting, says:

“I confirm that the reasons set out in Mr O’Connor’s letter of 28 June 2001 were those for which the Millennium Commission rejected the application from Asha. The issues of whether Asha would secure the land on which it intended to site the project and its value for co-funding purposes were not the bases on which the Millennium Commission reached its decision. The Commission received more applications in Round 5 than could be funded within the available budget. The Asha application was judged less attractive than others before Commissioners and was therefore rejected.”

21. Asha delayed making this application for judicial review until the 19th September 2001. The application stated the wish of Asha not to “undo” or “remove” the grants made to the successful applicants which had been progressed in the meantime and that no remedy was sought such as would have this effect, on the basis that the Commission had ample resources at its disposal by which it could on reconsideration choose to make a grant to Asha. The Commission agreed to this course. It had continued to progress the other grants, but has set aside a contingency fund of £10 million to meet this eventuality.
22. Asha challenges the Decision on two grounds. The first is that the Commission in making the Decision misdirected itself having failed to have regard to the Statutory Consideration and Commission Criteria and Guidelines. The second is that the Commission failed in its duty to give adequate reasons. I must consider each of these challenges in turn.

MISDIRECTION

23. In support of the contention that the Commission misdirected itself, Asha rely essentially on four matters:

a) the fact that the Decision was expressed in the Minute and June and July Letters to be by reference to the attractiveness of the projects and not by reference to the Statutory Considerations or the Commission Criteria and Guidelines;

b) the lack of contemporary documentation evidencing that the Commission took the Statutory Considerations and Commission Criteria and Guidelines into account;

c) the language of the July Letter; and

d) (as a symptom or evidence of both the above and not as a separate ground of challenge) the admitted failure to have regard as a relevant consideration to the architectural merit of the proposed Asha Centre.

24. The starting point in evaluating this challenge is the heavy burden on Asha to make good the contention of the existence of the misdirection. In this regard it is to be noted that:

a) Section 41 required the Commission to exercise a subjective judgment as to the appropriate projects to be supported, having full and proper regard and giving due weight to the Statutory Considerations and the Commission Criteria and Guidelines. The provisions of the Act regulating the selection of members of the Commission underlines the important role of the personal judgment of the persons selected to constitute the Commission;

b) the Commission should be assumed (in the absence of evidence to the contrary) both as a matter of law and as a matter of common sense (i) to have known what it was their duty to know, namely the provisions of the Direction and the Statutory Considerations and the Commission Guidelines and Criteria; and (ii) to have reflected these in the Decision;

c) that assumption is reinforced by a consideration of the material available to the Commission in the course of its lengthy dealings over the years with Asha and the material placed before the Commission by its staff (and in particular the material so placed at the instance of Asha). Ms Lieven, Counsel for the Commission, has before me undertaken an invaluable and exhaustive analysis of this material. It is plain from that analysis that, whilst (as Mr O’Connor stated) the Commission staff based its recommendations on an appraisal of risk leaving the wider considerations for the Commission, it placed before the Commission the available material relevant for that wider exercise to be undertaken by the Commission and for consideration by the Commission of the applicable Statutory Considerations and Commission Criteria and Guidelines which were its particular concern e.g. the public good and the significance of the Project as part of the Commission’s wider portfolio. This was normal practice and (as one would expect, but Mr O’Connor in his evidence puts beyond question) the Commissioners knew the respective roles of the staff and themselves and of the papers put before them.

25. I turn now to the four matters relied on by Asha. The first is that the Commission expressed the choice in terms of the attractiveness of the project, i.e. which of the projects had most appeal to them. Such language is in my view perfectly apposite to the choice required by Section 41 of the (more) appropriate projects judging the competitive exercise having regard (as required by law) to the Statutory Considerations and the Commissions Criteria and Guidelines. The choice of language is indicative of no error or misdirection.
26. The second is the lack of contemporary documentation evidencing that the Commission took account of the Statutory Considerations and the Commissions Criteria and Considerations. The answer is that the Minute itself points to the consideration of these factors and that the evidence makes plain that the proper exercise was undertaken. The absence of further or more elaborate contemporary documentation is not significant, let alone sufficient to rebut the presumption of regularity.
27. The third relates to the fourth, fifth, sixth and seventh paragraphs of the July Letter. In the fourth paragraph it is stated that the Commission carried out the assessment as outlined in Annex C. In the fifth paragraph there is a statement that “the appraisal was made entirely on the basis of the information supplied by the applicants”. The sixth paragraph says that the results of the appraisal were before the Commission. The seventh paragraph states that the Commission proceeded (as required by Section 41) to form its view as to the comparative merits of each eligible project “taking into account the Commission’s key Criteria”. The reference to “the appraisal” in the fifth and sixth paragraphs is not entirely clear. Mr Fordham, Counsel for Asha, submits that the language indicates that the exercise referred to in the fourth paragraph was the appraisal referred to in the fifth paragraph, namely an appraisal by the staff of the Commission and not the Commission; and that this is indicative that there was no assessment as there set out by the Commission itself. In my view the seventh paragraph reinforces the thrust of the fourth paragraph and the July Letter as a whole that the Commission carried out the assessment according to the Commission’s Criteria and Guidelines. To make sense of the July Letter, it seems to me necessary to read the words in the fifth paragraph “The appraisal” either as “An appraisal” or “The appraisal of risk”: if this is done, the contents of the letter make complete sense and what it says accords fully with the evidence before me as well as the presumption of regularity. The Commission staff made an appraisal (in relation to risk) which the staff put before the Commission: the Commission and the Commission alone made the wider assessments referred to. Accordingly I do not consider that the error or infelicity of language in the July Letter establishes the existence of any misdirection or error on the part of the Commission.
28. I turn to the fourth related complaint. In the fourth paragraph of the July Letter, it is stated that the Commission have assessed the applications before it against the key criteria, one of which is the ability to achieve high standards of design and constructional implementation. It is however common ground that the architectural merits (or demerits) of the proposed Asha Centre were not taken into account as relevant considerations in the Commission’s evaluation of the Asha application. Mr Fordham made plain that his application could not succeed on this ground alone: amongst the reasons for this are that no reference is made to this matter of complaint as a ground of challenge in this application for judicial review. It only emerged as a matter of complaint shortly before the hearing. But he relied upon it as illustrative of the failure of the Commission to decide the application according to the Commission’s Criteria and Guidelines.
29. The answer to this complaint is reasonably clear. The architectural merit (or demerit) of a project, where it is present, is a relevant consideration. The July Letter makes plain that, where architectural merit was present, the Commission treated it as relevant and gave the consideration due weight. In the case of the Project however, most particularly having regard to recent changes in the architectural plans, it was not possible or appropriate for the Commission to exercise a judgment on the score of architectural merit and accordingly to treat architectural merit as a relevant consideration in evaluating the Project. I do not therefore consider that the absence of reference by the Commission in its decision-making to any architectural merit in respect of the Project constitutes or is indicative of any error by the Commission.
30. For the above reasons I therefore reject the challenge to the Decision on grounds of misdirection.

REASONS

31. In the absence (as there is an absence in this case) of a statutorily imposed duty to give reasons, the duty to act fairly may require a decision-maker to give reasons for his decision. Whether such a duty is imposed and the extent of the duty must depend on all the circumstances and in particular the nature of the decision, the character of the decision-maker, the practicability of any obligation to give reasons and the impact of the decision on the parties affected. It is common ground that the Commission was obliged to give Asha the reason or reasons for the refusal of the grant sought. At issue is the adequacy of the reason given. The Commission contend that it was sufficient for the Commission to assign as its reason its preference for other applications. Asha however contends that the Commission was obliged to give the reasons why it preferred the other applications to the Project.
32. In resolving this issue the starting point, as it seems to me, is to examine the nature of the decision-making process required by the Act of the decision-maker (the Commission) in making the Decision, for there is an inextricable link between the decision-making process and the requirement to give reasons. I would express the link in the following propositions: (1) if and so far the decision-maker is obliged in the course of his decision-making process to articulate reasons for his decision, then there is scope for imposition of an obligation to disclose those reasons to the parties affected; (2) if the decision-maker is under no obligation in the course of his decision-making process to articulate reasons or to articulate them more than is implicit in a summary conclusion or the decision itself, and the decision-maker does no more than he is legally bound to do, there can be no scope for any obligation to give reasons or to give reasons more than are so implicit in his summary conclusion or decision. The obligation to give the reasons for a decision is an obligation to give the actual reasons for the decision, not reasons reconstructed later and, if there were no articulated reasons or more fully articulated reasons at the time of the decision, there are none that can be given later; (c) if and to the extent that the decision-maker is placed under an obligation to give reasons for his decision, or has assumed an obligation to do so, then that must relate back and impose upon him an obligation to the like extent to articulate reasons when making his decision, for only by implying such a duty in the decision-making process can the duty to give reasons be given effect.
33. I turn accordingly to the question how far the Commission is required to articulate reasons in its decision-making process. This, as it seems to me, depends on the decision in question. If it decides not to make a grant to an applicant on the ground that the applicant for any reason is not eligible, the Commission is required to articulate the reason why it has decided that the applicant is not eligible. If the Commission’s decision turns upon the determination by it of an issue of fact, then it is required to articulate that decision of fact as the reason for its decision and (depending on the circumstances) reasons may be required for that decision of fact. But the position is, as it seems to me, different when the Commission is not adjudicating on eligibility or fact, but has to undertake the exercise of comparing and evaluating the multitude of relevant considerations and criteria to be taken into account in selecting the successful applicants for grants. The decision by the members of the Commission on this exercise will inevitably involve an exercise of subjective judgment on the many imponderables involved. The corporate judgment that some projects are more appropriate than others may not readily be amenable to further elucidation. It is highly improbable, even if it is possible, that the Act requires the members of the Commission to agree as to the corporate decision more than the preference for some projects over others: the reasons of the individual members for that preference may be various and conflicting. The argument advanced by Asha (in effect) is to require the Commission to agree a comparative analysis and evaluation of all the eligible projects. In different contexts decision-makers may be required to undertake this exercise. But I cannot think that such an exercise is apposite or required either on principle or authority in the statutory context in question in this case. The language of Section 41 as it seems to me requires only that in the exercise of the subjective judgments of its members the Commission reach a corporate conclusion, namely the list of preferred applicants.
34. Contrary to the submissions of Asha, I do not think that the statutory obligations of the Commission in respect of its reasoning are extended by the statement in the Pack that, if requested, the Commission will explain to losing applicants why they lost. The legitimate expectation so created, at it seems to me, is that the Commission will communicate the reasons for its decision. The reason for individual rejections might vary. The reason for a rejection might be (as I have already said) that the applicant’s project was ineligible; it might be (as it was in one case) that insufficient information was submitted; or it might be simply (as was the case of the Project) that other projects were preferred. I do not think that the statement can or should be read as effecting by a sidewind a fundamental change in the Commission’s decision-making process. The legitimate expectation of losing applicants is limited to receipt of the actual reasons for the decision reached not to award them grants.
35. I accordingly reach the conclusion that the Commission was not under an obligation, whether statutorily or self imposed, to articulate reasons in its decision-making for preferring one applicant to another and therefore in this case the ten other applicants to Asha. Accordingly the Commission cannot have been under any obligation to give reasons to Asha beyond saying (as it did) that it preferred other applicants to Asha
36. I have reached the conclusion which I have without feeling the need to rely on any authorities. A number of authorities on the legal requirement to give reasons for decisions were however cited to me and as they accord with my conclusion I can consider them shortly. A decision must be made by the decision-maker and not the decision-maker’s staff and the duty to act fairly is imposed on the decision-maker and not the staff: R v. Independent Television Commission ex parte TSW Broadcasting Ltd [1992] 2 LRC 414. I have already held that the relevant decision-making was by the Commission. Schiemann J in R v Poole Borough Council ex parte Beebee [1991] 2 PLR 27 at 31 pointed to the theoretical difficulties of establishing the reasoning process of a corporate (rather than a collegiate) body which acts by resolution and that this factor is relevant in deciding the existence and limits of an obligation of a corporate body to give reasons for its decisions. The Commission is a corporate, not a collegiate, body. It is well established that there is a category of decisions for which no reasons need be given beyond those implicit in the conclusion reached: see Latham J in R v Professional Conduct Committee of the GMC ex parte Salvi (unreported) 4th February 1998. In R v Higher Educational Funding Council ex parte Institute of Dental Surgery [1994] 1 WLR 242 at 261, (“Dental Surgery”) Sedley J (delivering the judgment of the Divisional Court) held that academic judgments (e.g. that the claimant should be assessed at level 2) were not in the class of case where the nature and impact of the decision itself required that further reasons be given as a routine aspect of procedural fairness. R v City of London Corporation ex parte Matson [1997] 1 WLR 765 (“Matson”) established that, where the decision of the character referred to by Sedley J does not stand alone, the situation may be different and reasons may be required, e.g. if there is a factual basis for the decision which can be articulated without difficulty (per Swinton Thomas LJ at p.783F) or if the decision is by a court of record or the decision may involve a finding of inappropriate conduct and cast a shadow on the reputation of a party affected (per Neill LJ at 776G-777D). The decision of the Commission in this case on the relative appropriateness of the various applications for grant is in my view comparable for present purposes to the academic judgments in issue in Dental Surgery and there are no such further considerations as were present in Matson.
37. I therefore hold that the Decision is not open to challenge on the second ground advanced, namely the failure to provide adequate reasons.

RELIEF

38. A question has been raised as to what order would have been appropriate if I had found that the Commission was obliged to give fuller reasons for the Decision than it did. Ms Lieven for the Commission submitted that I should leave the Decision undisturbed and merely require the Commission to provide further and fuller reasons. In my view however the only relief which would be fair both to Asha and the Commission in these circumstances would be to quash the Decision. I could not require the Commission to provide further reasons for the Decision where there were none, and I should not order the Commission to reconstitute or reconstruct its reasoning. A fresh decision would have to be made as at the 27th June 2001 on the facts and evidence as it existed at that time. This may involve a degree of artificiality, ignoring subsequent events and in particular the grants to the successful applicants and the progress of their projects. But nothing less could achieve fairness in the decision-making process and the arrangements between the parties to which I have referred in paragraph 21 of the judgment and the provision of the contingency fund make this form of relief practicable.

CONCLUSION

39. I accordingly dismiss this application. I must make it clear that my decision involves no findings on the merits of the Project. The merits of the Project (if capable of realisation) are self-evident. At issue in the competition were not its merits, but its comparative merits with those of the other applicants. Unfortunately in any competition (as in any litigation) as well as winners there are losers. I must conclude by expressing my appreciation to both Counsel for their industry and assistance.
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MR JUSTICE LIGHTMAN: For the reasons set out in the judgment which I have handed down, I dismiss this application.

MS LIEVEN: My Lord, in those circumstances, on behalf of the Millennium Commission I apply for my costs. I understand my learned friend will be resisting that, but I think the best thing is if I listen to his submissions and then respond to them.

MR JUSTICE LIGHTMAN: Yes.

MR FORDHAM: My Lord, I am going to invite your Lordship to take the exceptional course of saying that there should be no order for costs. The approach is to look at the overview of the case and to reach your conclusion based on two questions: one, who succeeded. Well, that is plain; I lost. But two, what order for costs does justice require.

My Lord, what I say is simply this: that it would, in my submission, be a proper exercise of your Lordship's discretion to say that there be no order for costs in these circumstances where the claimant has raised public law issues arising out of an understandable feeling of being aggrieved, where it has pursued its challenge in a responsible way, in a focused way, and in circumstances where it is a charity for whom the Millennium Commission grant was to be its lifeblood, and where -- and only your Lordship will know this -- but where I would suggest the arguments were at least balanced.

My Lord, in those circumstances, I would invite your Lordship to say that justice in this case does not require an order for costs against my clients.

MR JUSTICE LIGHTMAN: In my view, justice requires that I should make an order that the claimant should pay the defendant's costs, and I think justice also requires that the Millennium Commission should think very carefully and no doubt take into account how matters finally work out between the parties whether or not they wish to enforce the order. I think I can rely on the learned Commissioners to exercise responsibility in that regard.

MS LIEVEN: I am grateful, my Lord.

MR FORDHAM: It then remains for me to invite your Lordship to give my clients permission to take this case to the Court of Appeal. I ask your Lordship to do so, and ultimately my submission is that it is not unreal to suppose that the Court of Appeal would analyse this case differently and therefore there is a realistic prospect. I do not, of course, seek to persuade your Lordship that it is likely that they would take a different view. Your Lordship has reached your conclusion on the analysis.

But the alternative approach would be that this collective body does have a duty to articulate collective reasons and to look collectively, not individually, at its stated criteria in considering these competing applications. So those are the two points which, as your Lordship knows, are so closely linked in this case.

And if your Lordship will just give me a minute to lay out the path to that conclusion. It would be that it will start with the Millennium Commission's statement that it will give reasons for its decisions as a general promise, not one that relates simply to eligibility decisions or decisions that turn on particular facts. It would then proceed to distinguish those cases which are about the boundary between situations where collective decision makers do not have to give reasons at all and situations where they do. Those are the cases like Dental Surgery and Matson and the comments in the Beebee case. Because the starting point is that we are not examining that boundary; we are over the boundary in a situation where there is a duty to give reasons, and in those circumstances the analysis -- the alternative analysis will be to require a collective articulation by the Commissioners in addressing the decision as against their own stated criteria. Now, my Lord, I can illustrate the various points in the path by reference to parts in your Lordship's judgment, but it involves proceeding in that way, reaching that conclusion in the particular circumstances of a promise, we say, to give reasons.

But my submission in relation to permission to appeal is a simple one, and it is that it is realistic to think that the Court of Appeal would analyse this case in that different way, and in those circumstances it would be appropriate for your Lordship to give my clients permission to take this case to the Court of Appeal if they so wish.

My Lord, that is my submission.

MR JUSTICE LIGHTMAN: Thank you. I shall not give permission to appeal for two reasons. First of all, I do not think that an appeal has a realistic prospect of success; secondly, I do not think that more public money should be spent on this litigation.