England and Wales High Court (Administrative Court) Decisions

IN THE HIGH COURT OF JUSTICE
ADMINISTRATIVE COURT

		Royal Courts of Justice Strand, London, WC2A 2LL
		18 June 2003

Mr Justice Newman:

1. The claimant company, Ann Summers Limited (Ann Summers), was established in 1970. Its head office is in Surrey and it has 72 retail outlets situated throughout the United Kingdom. In addition it runs a party plan network as well as mail order and web site catalogues. The range of articles sold through its retail shops, by mail order and over the internet appear from various catalogues which are in evidence before the court. For example the Ann Summers' catalogue, autumn/winter collection 2002 is headed "Passion and Fashion". The frontispiece carries the following warning:

"This catalogue is for adults only. It features products of an explicit sexual nature. If you feel these may offend you please dispose of it".

The Ann Summers' Uncut mail order catalogue carries the same warning. The catalogue contains greater nudity than the Ann Summers' Collection catalogue, and, as the introduction states, it is designed to advertise "The horniest sex products". Whereas the collection catalogue contains what could be described as sensual lingerie, the Uncut catalogue contains articles and clothes which are expressly designed to be used in connection with sexual activity. The internet catalogue is a combination of both and calls for no particular comment.

2. In addition to the retail shop outlets it runs one shop in Bristol, which has been required by the local authority to be licensed to trade as a "sex shop", the licensing being under The Local Government (Miscellaneous Provisions) Act 1982. Ann Summers has not been required to seek a licence under the Act for any of its 72 outlets in other areas of the United Kingdom.
3. Jobcentre Plus is an executive agency of the Department for Work and Pensions. The agency was launched in April 2002 to bring together the work of the Employment Service and the Benefits Agency.
4. The legislative basis for the job – brokering role of the Department of State is contained in Section 2 of The Employment and Training Act 1973, in particular subsection (1):

"The Secretary of State shall make such arrangements as he considers appropriate for the purpose of assisting persons to select, train for, obtain and retain employment suitable for their ages and capacities or assisting persons to obtain suitable employees (including partners and other business associates)."

The fulfilment of the obligations of the Secretary of State under Section 2 of the Act is advanced by the provisions of The Jobseekers' Act 1995 and The Jobseekers' Allowance Regulations 1996 (SI 1996 No. 207) (as amended). One of the principal objectives served by the Jobseekers' Act and Regulations is to provide a benefit for people who are unemployed, or who work for less than 16 hours per week, and who are looking for full-time employment. To qualify for Jobseekers' Allowance a person has to satisfy certain conditions, in particular, the labour market conditions which require a person to be available for work and willing and able to take up work. The allowance would not be payable if the jobseeker has, without good cause, after a situation in any employment has been notified to him by an employment officer as vacant, or about to become vacant, refused or failed to apply for it or accept it when offered. The relevance of these provisions to the issue the court has to resolve will appear later in the judgment.

The challenge

5. In 2001 Ann Summers entered a period of major expansion. In that year 13 new shops were opened and the aim in 2002 was to open a further 100. At that time there existed a ban which prevented Ann Summers advertising its vacancies in Jobcentre Plus recruitment centres or Jobcentres. As a result Jacqueline Gold, the Chief Executive Officer of Ann Summers since 1993, wrote to the Minister by letter dated 10 May 2002 drawing attention to the proposed expansion programme and foreshadowing a recruitment need for some 1,000 new members of staff to work in the stores. Ms Gold pointed out in the letter -

"Your colleagues have informed us that the reason Ann Summers can not recruit through the Jobcentres is because it is believed that Ann Summers is part of the sex industry. I would have more understanding of this policy if other government departments classified Ann Summers as a sex shop and we were asked to apply for a license to trade, but this is not that case so we are clearly not a sex shop."

The writer went on to point out that attitudes had changed and that Ann Summers is an accepted retail store on the nation's high streets.

6. By letter dated 26 June 2002 the Chief Executive of the defendant replied as follows:

"As a result of your letter I have personally reviewed the position. Having done so, I have concluded that our approach of not handling vacancies associated with the sex or personal services industry remains appropriate. This policy is one which we have operated over many years and under successive governments. It does not reflect in any way on the Ann Summers business, nor does it seek to make a judgement on the business sector in which you operate.

"The key issue here is that, as a public employment service, Jobcentre Plus requires many of its clients to be willing to consider the vacancies we have on offer and to demonstrate that they are actively seeking employment. Failure to do so can lead to a loss or reduction in their benefit entitlement. Against that background we do not consider it right to handle vacancies which could potentially offend or cause embarrassment to a significant number of jobseekers and which could place them in the position of either being willing to consider such vacancies or putting at risk their continued entitlement to state benefits.

"In your letter you say that you are not a sex shop. To be clear, my only interest in that question is whether, on any reasonable common sense test, there are a number of jobseekers who might conclude that this is indeed the business with which you are associated and who might be offended or embarrassed if asked to consider a vacancy in your organisation. I have to say that, having taken the opportunity to view your web site, it is self-evident to me that this is the case. From the tone, language and graphics used, it is clear that you are making a range of adult sex products that could indeed cause embarrassment or offence to substantial numbers of jobseekers.

"I am sorry that I have been unable to respond more positively to your request but hope that you will be able to meet your recruitment needs through the many other recruitment channels available to you."

7. The correspondence was then taken up by solicitors for Ann Summers and in a letter dated 6 August 2002 the solicitors requested –

"In order that we can properly advise Ann Summers, please could you:

1. Inform us whether the policy referred to is a written policy and, if so, provide a copy of it;

2. Explain, if this is not apparent from any policy document provided to us under 1 above, how you have defined "sex or personal services industry" in the context of the policy;

3. Indicate in respect of what other industries (if any) the same or a similar policy is operated and provide a copy of any such written policy; and

4. State whether Jobcentre Plus maintains a list of "prohibited" advertisers pursuant to the policy it is operating against Ann Summers and, if so, provide a list of those prohibited advertisers.

"As you will appreciate, Ann Summers is aggrieved by the application of your policy to it which not only prevents it from advertising staff vacancies in Jobcentres and taking advantage of the services you offer but deprives certain jobseekers of the opportunity to consider those vacancies.

"Ann Summers is currently resolved to challenge both the lawfulness of your policy itself and the application of it in the Administrative Court if necessary. However, my view and that of Ann Summers is that there is scope for resolution of this dispute without resorting to the courts. It appears to me that part of the problem arises from a misconception as to the nature of the vacancies that Ann Summers is seeking to fill in its high street retain outlets, Head Office and warehouse operations which have led, wrongly, to your classification of them as "vacancies associated with the sex or personal services industry". It would, in our view, aid a better understanding if either the Minister, you or a member of your senior staff set aside time to meet with a senior executive of Ann Summers and take the opportunity to be shown their operations to see for themselves/yourself what is involved. I anticipate a suitable "tour" could be laid on to achieve that better understanding and to discuss the issues very quickly. I would anticipate the tour could be completed in less than half a day, and would then be the basis of an informed discussion.

"The proposal made in this letter is a genuine attempt to see if a resolution can be achieved outside the formality of court proceedings."

The suggestion of a visit and meetings was taken up and as a result the matter was reviewed by the Chief Executive. Although there was a period of delay, in respect of which complaint was made, on 14 November 2002 the Chief Executive gave notice of the decision which is now under challenge. Having reviewed the matter and considered it with Ministers the defendant decided that Ann Summers should not be permitted to advertise through Jobcentre Plus or its associated website.

8. The correspondence discloses a difference of opinion between the parties as to the true character of the business carried on by Ann Summers. The difference was maintained in the evidence before the court: the rival contentions have been whether it is a "mainstream retail" business or engaged in "the sex industry". The decision letter proceeded upon the basis there was no reason to doubt the following facts :

"Ann Summers has developed a generic store design with only three of the 67 stores departing from it (one of which was the Oxford Street store which had been the subject of the proposed visit until Ann Summers decided that it would prefer the store visit to be at Lakeside shopping centre, Thurrock);

However, the stock in all the retail shops can include any of the items in the catalogue or on the website;

Ann Summers have only one store licensed as a sex shop under the Local Government (Miscellaneous Provisions) Act 1982 or the Civic Government (Scotland) Act 1982 and have no plans to expand this sector;

Lingerie accounts for the major part of the sales space with "novelty" or adult products accounting for less than a third; and

Company policy was always to locate adult merchandise of a kind rarely found outside licensed sex shops in a zone marked "no admittance under 18 years of age". "

The so-called novelty or adult products are, in my judgment, undoubtedly sex articles or sex products. They include a variety of articles specifically designed for use in sexual activity, including a variety of vibrators, of which specific mention is required, having regard to the detail of an argument advanced for the claimant. In these circumstances I have no hesitation in rejecting the submission that the defendant was not entitled to regard Ann Summers as being engaged in the "sex industry, the sale of sex products or running retail sex shops".

9. Ms Gold records that she "felt very strongly that describing Ann Summers as part of the "sex industry" was wrong and entirely misunderstood the Ann Summers concept. A "sex shop" is one which requires a licence to trade….." In her view the business "is an accepted retail concept …….recognised as part of modern high street shopping".
10. These are bold assertions and as the detail of the case discloses are largely subjective conclusions, said to be supported by certain objective material. It is said that

"….social trends have increasingly resulted in dramatic changes in consumer attitudes, and the media has become more open and positive in its attitude about sex programmes such as Channel 4's "Sex in the City" and "Sex Tips for Girls" demonstrates, in particular, an increased confidence on the part of women about their sexuality."

11. Additionally, reliance was placed upon the fact that there had been an "increase of mainstream shops selling lingerie, sex toys and accessories". Notably Libertys, the well known London retail shop was selling vibrators in November 2002, as part of its Christmas promotion. According to the evidence they had sold out of the item. Selfridges, another well known retail shop had a window display devoted to a "window of love" in which a vibrator took pride of place. The court was informed that such sales through these stores has continued.
12. I accept that objective material, namely television programmes, discussion in the media of explicitly sexual activity and the commercial sales of sex products including the extent of Ann Summers business, point to a change in social attitudes and behaviour among a wide section of the population, but I am unable to accept that the changes can alter the character of the articles which are retailed. Even if they were sold on every high street in the country and advertised on television they would nevertheless retain their character as sex products or sex articles.
13. Section 4 (1) of the Local Government (Miscellaneous Provisions) Act 1982 defines sex shop and sex article as follows:

"Section 4(1) In this schedule sex shop means any premises, vehicle, vessel or stall used for a business which consists to a significant degree of selling, hiring, exchanging, lending, displaying or demonstrating –

(a) sex articles;

(b) other things intended for use in connection with, or for the purpose of stimulating or encouraging –

(i) sexual activity; or

(ii) acts of force or restraint which are associated with sexual activity."

I shall return to what I regard as the relevance of this provision to the issues which have to be decided. In expressing any conclusion on the character of the products I should not be taken as expressing any view on the need for licensing. As a result it is for the relevant inspectorates to apply parameters and criteria in connection with individual products as they consider appropriate.

14. Before turning to an analysis of the decision, brief reference should be made to the terms of the written policy which underwrote the prior refusal of the defendant to carry adverts for vacancies in the Ann Summers business. The defendant's manual headed "The Guide to Job Broking" dated 28 February 1997 carried a section under the heading "Vacancies You Must Not Service" which listed the areas of activity which should not be accepted for business. They included:

"Unlawful selection criteria or advertising: e.g.; vacancies where the employer wishes to apply unlawful discriminatory criteria or to advertise the vacancy with us in terms of which break the law: for example, a vacancy which conflicts with the Race Relations Act 1976, Sex Discrimination Act 1976, or Disability Discrimination Act 1995 (see ES Guide 38 and supplement for more details);

Vacancies which would result in a breach of the law if someone were taken on: for example, an agricultural vacancy where the wage is lower than the rate set by the Agricultural Wages Board (see 'Agricultural wages' above);

Vacancies on premises about which there are doubts under the Health and Safety Act 1974 (see Health and Safety above);

Where the person may be asked to break the law in the course of duties undertaken; an example of this is selling raffle tickets or street sales without a licence from the Local Authority where this is required;

Where complaints from jobseekers suggest that the vacancy might be doubtful, undesirable or not genuine;

Vacancies in massage parlours, escort and kissogram agencies, striptease artists, models for 'blue' films/magazines or performers in sex shows. Advertising this type of vacancy is not considered to be in the best interests of the public or the ES. You should politely advise anyone notifying such vacancies that the ES does not deal with these types of job and decline to accept them. Avoid any suggestion that these jobs are improper or that people doing such work are not respectable.

Medical research – drug companies seeking to recruit volunteers to test new drugs may approach jobcentres to advertise the opportunities. It is not ES policy to handle such advertisements, since they do not present appropriate opportunities to help unemployed people into jobs or training, nor in any way improve their job prospects. You should politely refuse to display such material but be careful not to express any view on drug companies or their testing methods

Vacancies selling raffle tickets or other fundraising ventures such as Scratchcards, from charities which are not registered with the Charity Commission or from employers working on behalf of such organisations (see paras below on 'Raffle tickets, scratchcards and charity involvement'): and

Vacancies from employers who are subject of a national or regional warning."

15. It has been submitted, with some justification, that prior refusal to advertise because of the existence of a policy "of not handling vacancies associated with the sex or personal services industry" (see letter 26 June 2002) would not have found ready support in any of the points set out in the written policy. A corollary to that submission is, that the previous written policy being insufficient to encompass the claimant's business, the new policy, as set out in the November 2002 decision letter, was tailor-made to ensure that the claimant came within it. The 2002 policy, so far as material to the claimant, is the policy under challenge and it is in these terms:

"… businesses involved as a significant part of their business, in the manufacture, distribution, display, demonstration, promotion or sale of sex related products, usually available to the general public only through licensed sex establishments and not commonly found elsewhere on the high street"

would not be accepted as advertisers. In my judgment Ann Summers plainly falls within the policy. The question is whether the policy can survive this challenge.

16. The reasoning in the decision letter is contained in the following paragraphs:-

"In order most effectively to fulfil the functions for which they exist, Jobcentre Plus need to be able to encourage jobseekers to consider, and if appropriate, apply for, all jobs from the range advertised. That conclusion was subject to there being a compelling reason to the contrary. The application of sanctions for failure to apply and the notification of the jobseeker of an available job as a precursor to such application represent the formal end of the spectrum beyond mere encouragement. They are designed to ensure the effective operation of the labour market and that Jobseeker's Allowance is available only to those who are available for work and actively seeking it, but unable to find work. In this context, we have noted that the jobseeker can refuse to take up an offer whether or not it is advertised in a Jobcentre Plus if he or she has "good cause". "Good cause" under the relevant legislation includes a conscientious objection.

"In relation to most type of job and most type of jobseeker, no difficulty would arise. Encouragement, followed if appropriate by notification and ultimately sanction, would be available.

"However, there are some jobs (even leaving aside extreme cases) in relation to which significant difficulties arise. The precise difficulties may vary depending on the nature of the business offering the job. Such difficulties include (a) the situation which arises where most claims of conscientious objection would be likely to be upheld, so that (if operated consistently across the country) sanctions for failure to apply for a job would not be operable; and (b) difficult questions as to whether, for jobs of this kind, the notification process would appropriately be used and/or whether jobseekers should actively be encouraged to apply.

"There were also difficulties attendant on requiring jobseekers to justify a refusal to apply for such a job. We do not wish, without good reason, to expose jobseekers to the need to defend or explain their reasons for not selecting or applying for a vacancy for such a job, or for refusing to be referred to one. Feelings about work concerning sexual activity are of a private, personal and sensitive nature; and some unemployed jobseekers might be reluctant to enter into such discussion and thus feel pressurised into taking decisions they would not otherwise take, or might feel acutely embarrassed at having to do so. Jobseekers who seek assistance from Jobcentre Plus come from a very wide range of cultural and social backgrounds and include people from some of the most disadvantaged and vulnerable groups in society.

"There is a clear need to ensure, so far as possible, a consistent, countrywide approach. There should not be different practices applied in individual Jobcentre Plus offices or by staff within those Jobcentre Plus offices on such issues. The risks of inconsistency of approach, and conversely, the benefits of a clear, easy to follow approach, are obvious. There are a large number of Jobcentre offices (some 1,000) across the country, employing a large number of staff (some 35,000 many of whom are involved in such decision making). The newly established Jobcentre Plus organisation will extend the number of staff potentially involved in such decision making to a figure of up to 90,000.

There is a close connection between advertisements in Jobcentre Plus and these issues concerning encouragement, notification and sanction. It would be undesirable both in terms of consistency of action and approach and in terms of the overall aim of effectively placing unemployed jobseekers back into work, for advertisements to be carried for vacancies in an organisation whose jobs gave rise to the difficulties set out above. The Jobcentre Plus system would work much more effectively if all parts of the process, from advertisement to sanction, operated in harmony along clear lines."

17. The decision letter went on to state that consideration had been given to whether there was any factor which should cause Ann Summer's vacancies to be advertised despite the fact that it fell within the policy: Further, whether there existed an acceptable lesser alternative to a refusal to accept such advertisements. As to the first matter, the defendant concluded that no basis for exemption was made out because the very difficulties which the policy contemplated would arise, but there would be no real detriment to Ann Summers because it had not experienced any shortage of applicants for its vacancies.
18. As to the second consideration, the defendant stated:

"In this respect we considered first whether it would be possible to permit advertising whilst issuing some sort of guidance as to when it would and would not be appropriate to encourage, notify and/or sanction. We concluded that that would not be an appropriate approach in the circumstances. The guidance would be difficult to formulate clearly. It would add another tier of decision making and potential inconsistency of approach to a system in which a clear and consistent approach was of central importance. It would be contrary to one of the main aims of Jobcentre Plus, which is to encourage jobseekers actively to consider all vacancies. It would not, and could not, address the legitimate concerns about the position of jobseekers.

"We considered next whether some form of warning could be attached to the advertisement. Again, however, the formulation of an appropriate warning would be very difficult; and would be contrary to the main Jobcentre Plus aim set out above. Further, a warning alone would not address the difficulties of ensuring consistent and clear approach by Jobcentre Plus to Ann Summers vacancies.

"We have also considered whether it would be appropriate to permit the advertisement of some jobs within the Ann Summers organisation or some jobs at some Ann Summers locations. The Department has concluded that this would not be an appropriate or workable option. The risks of inconsistency of approach are clear. There would need to be a decision made about each location and each job type: an impractical and in context unwarranted task. Issues would arise as to the transfer between job types within the organisation. It was better, whatever hypothetical examples might be postulated, to have a clear decision that no advertisements would be accepted."

19. Mr Eadie, counsel for the defendant, submitted that the reasoning could be broken down into four parts.

i) The need, in order effectively, to fulfil its role, for Jobcentre plus to encourage jobseekers to apply for all jobs advertised.

ii) The need for a clear policy and approach capable of being consistently applied country-wide by a large number of staff. Jobcentre plus employs over 80,000 staff working out of 1,500 offices.

iii) The difficulties created, including risks of inconsistent approach, by certain types of job in relation to which most objections would be likely to be upheld.

iv) The desire to avoid putting jobseekers through the need to explain and justify reasons for not selecting or applying for vacancies for such jobs, and to avoid potential offence and embarrassment.

Grounds of challenge

20. Miss Gallafent, for the claimant, advanced her argument by reference to five grounds.

i) That there was no rational reason for imposing a restriction on the advertising of the claimant's vacancies.

ii) That the emphasis on sanctioning was misplaced.

iii) That a blanket ban constituted a disproportionate response and/or was based on an error of law.

iv) That wrongful consideration was given to the provisions of the Local Government Miscellaneous Provisions Act 1982.

v) That the decision gave rise to the likelihood of inconsistent and arbitrary results.

21. Miss Gallafent's starting point was section 2 of the Employment and Training Act 1973. She submitted that the legislative purpose was plain, namely assisting persons to select, train for and retain employment suitable for their ages and capacities, or assisting persons to obtain suitable employees. There was no dispute the section gave rise to such a responsibility on the part of the defendant. It had recognised the position in its Job Broking Guide which stated:

"Jobcentre plus has a responsibility under the Employment and Training Act 1973 to provide a public employment service to both employers and jobseekers. We must, therefore, have strong grounds for refusing any employer access to our services."

22. Next, she identified what she submitted was further common ground between the parties, namely that the ban on advertising the claimant's vacancies was not imposed nor sought to be upheld on the grounds of public policy, public morality or some other value judgment as to the perceived societal value of the Ann Summers business.
23. In support of her first ground she submitted that on a proper analysis of the decision letter it was apparent that the new policy had been constructed on the basis of the potential for embarrassment being caused to jobseekers and no more. As a result no rational and adequate basis for banning the claimant's advertisements had been made out. In my judgment the suggested analysis is not entirely accurate. I accept that the defendant was identifying what it regarded as operational objections which could arise should the Ann Summers advertisements be accepted. The contemplated operational difficulties are founded upon the potential for embarrassment but the consequences were seen to be of wider import and caused the defendant to consider the possible impact the advertisement could have upon the structure and operation of its business. It was entitled to take such matters into account in formulating its policy and considering the particular position of Ann Summers.
24. It is an integral part of the defendant's job brokering function, underpinned by the statutory provisions, that jobseekers are encouraged to apply for employment, that where circumstances call for it, notification can be given by the defendant to a jobseeker in respect of particular employment and if necessary a process of sanctioning can be put in place. The ethos of encouragement and sanction is central to the operation. It was concluded, as one part of the decision letter reflects, that

"Jobcentre plus need to be able to encourage jobseekers to consider, and if appropriate, apply for all jobs from the range advertised." [emphasis added]

Mr Eadie put it somewhat differently, he submitted the system would

work most effectively if all jobs advertised were jobs which all

jobseekers could be encouraged (with more or less persuasion) to

apply for. At another part of the letter (see paragraph 18 above) the

defendant put the point in absolute terms:

"It would be contrary to one of the main aims of Jobcentre Plus, which is to encourage jobseekers actively to consider all vacancies."

25. The difficulty for the defendant in maintaining the validity and integrity of the purpose, whether expressed as encouraging jobseekers to "consider all vacancies" or "consider, and if appropriate, apply for all jobs", is that it either expresses the purpose too highly ("all jobs") or fails to take sufficient account of the qualification of "appropriateneness" and in both respects fails to sufficiently recognise the operation of the conscientious objection clause which necessarily means the main aim as expressed, is unattainable.
26. The defendant's "Decision Makers' Guide" provides at Chapter 34 (Sanctions), under the heading "Sincere, religious or conscientious objection" as follows:

"If a claimant refuses or fails to apply for or accept employment because of any religious or conscientious objection, which the claimant sincerely holds the DM [decision maker] should take this into account when deciding good cause."

The guide goes on to state

"Claimants cannot show good cause just by saying, for example, that they conscientiously object to doing a certain employment. They must

1) show that one or more of the terms and conditions of employment conflicts with the principles on which their objection is based, and

2) give enough evidence to satisfy the DM that their religious or conscientious objection is sincerely held."

27. The guide also gives a number of examples of religious or other conscientious objections which may provide good cause, for example, an objection to employment that involved the handling or supply of alcohol, cigarettes or tobacco. A religious objection to being in employment on a particular day each week. An objection to an employment with something which may be used to destroy life, whether human or animal. A religious objection to being in employment with members of the opposite sex. In the course of argument further examples were given of the application this provision. Vegetarians might object to employment in a butcher's shop or a sausage factory. A great number of people might object to working in an abattoir. Jewish people might object to working equally in a butcher's shop or handling anything in connection with pigs or the product of pigs. These being likely incidents in the normal carrying on of the defendant's business, which according to a particular area, may be of heightened significance, for example, employment in a pub in a predominantly Muslim area, it was submitted it was irrational to identify any particular problem arising out of any special consideration which would have to be given to the claimant's business.
28. So formulated, in my judgment, the claimant's argument was partly right and partly wrong.
29. The claimant asserted too much. I accept that the size of the business, having an annual turnover for the year 2001-2002 of some £85m, being carried on from some 72 high street stores in prime locations, as well as a successful mail order business through the catalogue and internet, comprises evidence which can be taken as demonstrating that far from a great number of people being embarrassed or offended by the products on sale, many are purchasing them. It is said that 70% of Ann Summers' customers are women and the remaining 30% are men shopping with their partners. I have already stated that I accept the force of the objective material which supports a change in attitude. However, I unhesitatingly reject the contention that the court should conclude, as a result, that the defendant erred in concluding that discussion by an individual of their attitude in connection with such sex articles could give rise to embarrassment or that the defendant should not have regarded such discussion as capable of giving rise to significant embarrassment to a number of jobseekers. In my judgment, therefore, the defendant was entitled to take into account how its encouragement, notification and sanction policy and its policy in connection with the conscientious objection clause could be operated within its own business if Ann Summers' advertisements were accepted. The real question is whether it approached this question rationally having regard to its duty to assist jobseekers and to assist employers.
30. Miss Gallafent drew attention to the weight which the defendant gave to its sanctioning policy. She highlighted the conclusion in the decision letter, that to allow the claimant's advertisements would give rise to significant difficulties including

"(a) the situation which arises where most claims of conscientious objection would be likely to be upheld so that (if operated consistently across the country) sanctions for failure to apply for a job would not be operable; and

(b) difficult questions as to whether, for jobs of this kind, the notification process would appropriately be used and/or whether jobseekers should actively be encouraged to apply".

31. I understand, and accept as legitimate, a desire on the part of the defendant to be seen to be implementing its sanctions policy, but to seek to sustain its reputation in that regard by avoiding taking advertisements which it believes might increase the number of occasions when conscientious objections would be upheld, is to elevate the principle of sanctioning beyond its purpose. Parliament has imposed a duty upon the defendant to operate a sensitive and fair system for dealing with conscientious objections. Further, the reasoning implicitly involves a conclusion that the number of objections which will be received in connection with Ann Summers' advertisements, will be of such an order as to generate a changed perception of the force of sanctions. There is no evidence, and none was relied upon in coming to the decision, to justify any conclusion about the number of jobseekers who would object to taking employment with Ann Summers. That said, as I have already stated, the defendant was entitled to conclude that some would and that the eliciting of objections from them would be likely to give rise to embarrassment and offence.
32. The illogicality of the defendant's position in this regard can be demonstrated by the examples taken by Miss Gallafent. In a predominantly Muslim local community, it may be that the majority of jobseekers would refuse to apply for a vacancy in a bar or a pub, but it could not be suggested that the defendant would therefore be entitled to refuse to accept any advertisements in bars or pubs or restaurants serving alcohol in the area. Similarly it would not be suggested that the defendant was entitled to adopt as a national policy a ban on advertisements for vacancies in abattoirs, butchers or sausage factory, on the basis that Muslims, vegetarians or Jewish people could legitimately object to employment in such activities. This point was not sufficiently answered by the submission that there was a difference in quality between the character of the objections in the examples and the sensitive character of the matters which Ann Summers' jobs could give rise. A need to have to explain any particular personal belief or conviction is capable of giving rise to some degree of embarrassment.
33. Given that the defendant was entitled to take account of the operation of the conscientious objections clause, which it could infer was likely to be invoked by some jobseekers if notification and sanctioning was to be applied to Ann Summers' advertisements, it is necessary to consider whether notwithstanding its flaw in elevating the sanctioning policy beyond a legitimate purpose, the defendant nevertheless was entitled to maintain its policy in order to protect jobseekers from being caused embarrassment by having to maintain an objection.
34. In my judgment the difficulties which might arise in the sanctioning process had to be weighed with the following factors:

i) The benefit which might accrue to jobseekers who would be prepared to take up employment with Ann Summers. In the absence of evidence it was impossible for any estimate to be made as to the likely numbers of those who would object and those who would not object. The claimant's uncontradicted evidence was that prior to a ban being imposed a significant number of jobcentres did advertise the claimant's vacancies, apparently without ill-effect. There is nothing in the decision letter, and Mr Eadie's breakdown (see paragraph 19 above) confirms the conclusion that regard was not paid to the possible benefit to jobseekers.

ii) The true extent to which operation of the defendant's functions would be affected. Having considered sanctioning, it is convenient to consider this aspect under encouragement and notification.

Encouragement and notification

35. The defendant is to be taken as having the necessary experience and knowledge to run its services and it is entitled to choose, so long as it comes within the legal framework which governs the activities, how best to perform its functions. The process of encouragement and notification is an important aspect of its operation. Encouragement can be divorced from notification. Notification is the first formal step in the sanctioning process. Mr Eadie emphasised the desirability of maintaining consistency throughout all jobcentres, both in connection with encouragement and notification.

Encouragement

36. The reason given in the decision letter was:

"(a) difficult question as to whether, for jobs of this kind, the notification process would appropriately be used and/or whether jobseekers should actively be encouraged to apply".

It cannot be doubted that the functions would be more easily performed if all jobs advertised were jobs which all jobseekers could be encouraged to take. But having regard to the number and character of the objections which can be raised to any number of jobs, the degree of difficulty, which might be occasioned by a new category of objection, requires a balanced assessment. There must be many occasions when the exercise of restraint and judgment is required of employment officers in deciding whether active encouragement should be employed. No particular difficulty in having to apply restraint to Ann Summers' advertisement has been identified. Consistency could be achieved simply by excluding them altogether from active encouragement. Again national consistency could readily be secured by Ann Summers' advertisements not being made the subject of notification. To this the defendant is entitled to make the riposte: why should we alter our methods of operation so as to accommodate Ann Summers' advertisements?

37. Miss Gallafent submitted that in truth the defendant had to operate it business by taking account of Ann Summers' advertisements (and others) whether it advertises the vacancies internally or not. In paragraph 36 of the Grounds for Judicial Review the claimant maintained that the defendant's policy on encouragement/notification/sanctioning is predicated on an erroneous distinction between vacancies advertised internally and elsewhere, for example, newspapers.
38. The defendant responded to the effect that the distinction did not advance the case because:

"Jobcentre staff are not required, as a result of the existence of Ann Summers' vacancies externally advertised, to encourage claimants to apply for those vacancies."

It is clear this point cannot survive the defendant's own "Labour Market Conditions Guide", Chapter 9, which provides:

"Notifying the jobseeker of the job

7. The job offered must be notified to the jobseeker by an Employment Officer. This also includes vacancies from local and national press advertisements which are identified by the Employment Officer and discussed with the jobseeker."

Mr Eadie did not argue otherwise. Indeed it was confirmed, in the course of argument, that the new policy will have to be applied by officers in jobcentres to all advertisements appearing in the press.

39. The policy, as material to Ann Summers' case, is as follows:

""…..Jobcentre Plus should not advertise vacancies:

Within licensed sex establishments;

……………….

In businesses involved, as a significant part of their business, in the manufacture, distribution, display, demonstration, promotion, or sale of sex related products usually available to the genera public only through licensed sex establishments and not commonly found elsewhere on the high street."

40. Two points emerge from the position in connection with externally advertised vacancies. Firstly Ann Summers' vacancies will have to receive special treatment within jobcentres throughout the country by restraint being applied to encouraging/notifying/sanctioning. If this policy is not adopted, the externally advertised Ann Summers' vacancies will have to be dealt with by the objections clause process and the defendants will not have escaped the embarrassment and sensitivity it has sought to avoid by refusing to take the advertisements internally. The evidence does not establish the extent of the advertising which Ann Summers employs through national and local press but spread locally or regionally some account needs to be taken of its likely extent, for if it occurs to the same degree as it would if permitted internally it is difficult to see what purpose the ban serves.
41. Secondly, the policy extends to all businesses within the category. The policy will have to be applied locally to advertisements from other businesses and a judgment will have to be applied to the question whether a significant part of the business falls within the listed categories of activities. How this can be applied either nationally or locally without the necessary facts being available in connection with the business is not clear.
42. For the above reasons I have concluded that the defendant's consideration of the true extent of the impact of taking Ann Summers' advertisements is flawed. It follows that in each of the respects set out in paragraph 34 above the defendant erred.

Likelihood of inconsistent and arbitrary results

43. The evidence discloses that Libertys and Selfridges have engaged more extensively in selling vibrators than the defendant accepts, but that said, the proportion of business not connected with sex products is greater and the range of sex products sold by Ann Summers includes a variety of objects, other than vibrators, which Libertys and Selfridges have not yet sold.
44. The short point made by Miss Gallafent is that no account appears to have been taken of job vacancies, for example in invoicing or the headquarters of Ann Summers which would not bring an employee into direct contact with sex products, whereas a job advertised in Libertys and Selfridges could do so.
45. Whilst the claimant's argument illustrates some of the difficulties which could arise for the defendant in implementing its policy, the difference in character between the claimant's business and the retail shops in question is significant and sufficient to prevent the policy being inconsistent and arbitrary. For completeness I should add that I have not forgotten that Mr Eadie drew the court's attention to the past difficulties which had arisen where advertisements had not accurately described a business and where jobseekers had experienced the misfortune of discovering the true character of their new employer. For example, where they had accepted employment in a massage parlour or in escort services. These are real difficulties which, so far as possible, must be avoided, but so far as they have been relied upon in connection with the taking of Ann Summers' advertisements, they are a long way from the substance of the reasons given for the policy and decision.

Blanket ban a disproportionate/irrational response

46. Miss Gallafent did not invite the court to treat proportionality as a separate ground of review (see The Association of British Civilian Internees – Far Eastern Region v Secretary of State for Defence Neutral Citation No: [2002] EWCA Civ 473. She invited the court to consider, as part of its rationality test, whether the response of the defendant to "the difficulties" it perceived the taking of advertisements within the policy would create, was an irrational response because it was manifestly not necessary to meet the position.
47. It is necessary for the court to remind itself that it is not concerned to consider whether "the scheme is a good scheme or a bad scheme", (R v Ministry of Defence ex parte Walker [2000] 1WCR 806. Nor for the court to strike down a policy because a better one could have been devised.
48. However in this instance the defendant specifically considered the availability of courses other than a ban and it gave its reasons for concluding no other reasonable option was available. In the circumstances it cannot be said that its reasoning in this respect is not be open to scrutiny.
49. The reasons given comprised:

i) difficulties in formulating guidance;

and

ii) potential inconsistency in approach from the addition of another layer of decision making.

50. No case for any difficulty in formulating guidance has been made out. On the material presently before the court it is difficult to see why the defendant could not simply withdraw advertisements falling within the new policy definition from the process of encouragement/notification/sanctioning. If that was done no question of inconsistency could arise.
51. Further, by agreeing to accept an advertisement a measure of control can be exercised over the content. For example it would stipulate that it would only advertise vacancies within the defined policy if the advertisement contains something to warn jobseekers that the employment will involve being concerned in the marketing and sale of explicit sex products.

Summary and Conclusions

52. In my judgment in reaching its decision the defendant lost sight of its statutory purposes and formulated its policy to ban Ann Summers' advertisements upon a basis which does not stand up to rational scrutiny.
53. It appears to have paid no regard to the potential benefit which jobseekers could obtain by taking up employment with Ann Summers. It concentrated upon difficulties which might arise from those who would object to the employment.
54. It paid insufficient regard to its legal obligation to assist employers to fill vacancies. Ann Summers cannot assert a right to have its advertisements accepted by the defendant but where Parliament has created an opportunity for all employers to have access to a publicly funded service, the provider of the service is bound to demonstrate a measure of flexibility and assist an employer in the way in which it operates the service, so as not to exclude an employer in a discriminatory manner. The defendant wrongly concluded that the difficulties it perceived would occur outweighed the detriment to Ann Summers which could advertise elsewhere without too much difficulty. In so doing it failed to have sufficient regard to its duty to assist Ann Summers as an employer. No doubt most employers could successfully employ personnel by using other means.
55. It elevated the sanctioning process beyond its proper level of purpose. It failed to give adequate consideration to the continued impact which externally advertised Ann Summers' vacancies could cause to its operation. It failed to give adequate consideration to the possibility that by withdrawing encouragement, notification and sanctioning, the advertisements could be accepted without giving rise to any significant difficulty by way of embarrassment to jobseekers.
56. In the light of the above I have concluded that the decision to ban Ann Summers' advertisements cannot stand, but it is a case in which the Court regards it as desirable to hear counsel in connection with the precise nature of the relief which should be granted.
- - - - - - - - - - - - -

MR JUSTICE NEWMAN: For the reasons given in a judgment which is to be handed down, this application for judicial review succeeds.

As it appears from the judgment, I have left over for discussion with counsel the precise form of relief which is appropriate in the circumstances.

Miss Gallafent?

MISS GALLAFENT: My Lord, I am grateful. The relief sought in the claim form is a declaration that the defendant's policy of 14th November 2002 was unlawful. I am conscious that put in that broad way it might go slightly further than the final paragraph. My Lord, that is at page 3 of the bundle your Lordship has.

MR JUSTICE NEWMAN: Sorry, my bundles have, through an administrative hitch, remained up in my room, but I can pick out the policy. The relevant policy is in the judgment, of course.

MISS GALLAFENT: It is indeed.

MR JUSTICE NEWMAN: So, if I can just have a moment to pick that up in the paragraph of the judgment.

MISS GALLAFENT: My Lord, paragraph 15, of the draft I had before.

MR JUSTICE NEWMAN: Yes, thank you.

MISS GALLAFENT: This is the policy under challenge. Of course the indented quotation is in fact one of the categories that were identified in the letter of 14th November and I am conscious that this decision only relates to that final category.

MR JUSTICE NEWMAN: Yes.

MISS GALLAFENT: My Lord, I discussed the question briefly with my learned friend; he and I thought it might be proper to make a quashing order, rather than a declaration, in respect of this matter. Where we depart is that my submission is that it should quash the policy, insofar as it is set out in that final paragraph. That is for the reason, as your Lordship goes on to consider in paragraph 15, that Ann Summers plainly falls within the policy as set out in that final bullet point, and the question is whether that policy can survive the challenge.

It is not simply whether Ann Summers, the decision to ban Ann Summers, was irrational, it is the policy itself which creates the final bullet point into which Ann Summers falls which is irrational, which, I say, is effectively your Lordship's decision.

For those reasons I therefore say that there should be a quashing order in respect of Jobcentre Plus's policy not to advertise Ann Summers' vacancies, or those of any other business falling within the final category identified in the letter of 14th November 2002.

MR JUSTICE NEWMAN: Why do you need that? Why is it not sufficient to simply quash the ban on your client Ann Summers?

MISS GALLAFENT: Well, my Lord, it is not a question of needing, because as far as my client is concerned, the quashing, in so far as its own ban, is far enough.

MR JUSTICE NEWMAN: Yes.

MISS GALLAFENT: But your Lordship's judgment indicates that it is the policy into which other employers, only on the final category, might fall, which is itself irrational.

MR JUSTICE NEWMAN: Yes. The reason I wanted this discussion is that I do not find it entirely straightforward because, as it will be apparent from my judgment, there may be evidential matters to which I have drawn attention which were absent from the facts which were before the court, which, if looked into, or in the future, may produce a different result.

I will hear Mr Eadie, but I have your basic point. Your basic point is that you submit that the logic of the judgment is that both the policy as expressed, and the decision to ban your client, should go.

MISS GALLAFENT: Yes, my Lord, yes.

MR JUSTICE NEWMAN: Thank you very much. Mr Eadie, what do you --

MR EADIE: My Lord, our submission is that the appropriate remedy is the remedy of a quashing order, rather than a declaration. Not least because the quashing order will lead, inevitably, to reconsideration of the matters raised in the judgment by Jobcentre Plus.

My submission is also that my Lord's judgment has focused very specifically; first of all on the position and policy so far as it affects Ann Summers, rather than anyone else who might fall within even that final bullet point of the policy, and has also focused very specifically on the reasons given in the 14th November 2002 letter justifying that ban. My Lord has not held, as we understand the judgment, that the policy could not be justified, even that final bullet point. In other words, it is not intrinsically irrational. My Lord has also not said that the policy, as it might apply to others, is intrinsically irrational.

So, on our reading of the judgment, your Lordship has been very specific, both in terms of the effect on Ann Summers and in terms of the reasons given in the 14th November letter. Both those two factors, in my submission, suggest that the appropriate form of any quashing order would be simply to quash the decision not to permit Ann Summers to advertise in Jobcentres. That goes far enough for my learned friend's clients, and, therefore, they are not in any way adversely affected or deprived of the fruits of their victory. But it also preserves, as we understand my Lord would interpret truly preserves, it also preserves the position so far as whether or not the policy itself, that final bullet point, could be justified on other grounds, and whether or not that policy, as applied to other people, might itself be justified. So both those features do, we suggest, tend towards the narrower form of quashing order.

MR JUSTICE NEWMAN: Like much of this case, what you have said is partly right and partly wrong. I have obviously expressed reservations about how the policy itself can be successfully operated; for example, when one takes into account the externally advertised vacancies in this sort of area of employment, and that is inescapable. On the other hand, I have also taken account of the fact that the emphasis, you say, for this decision, is one which has very much centred upon a consideration of Ann Summers' business and has concentrated upon a perception of what the position might be of jobseekers, without, as I have observed, really any satisfactory evidential base for coming to the sort of conclusions, and firm conclusions, to which your clients came.

So that is just really perhaps the two pivotal areas where it seems to me one is on each side of the dilemma.

MR EADIE: My Lord, yes, but in relation to that latter point, the reasons that my Lord has analysed and the justifications that my Lord has analysed, are those justifications set out in the 14th November letter.

MR JUSTICE NEWMAN: Indeed, yes.

MR EADIE: Now if that is right, by quashing the policy my Lord will be implicitly saying that this policy per se is unjustifiable. Put another way: this policy is intrinsically unjustifiable. There could be no basis upon which, under any circumstances, forget about the reasons as set out in 14th November letter, there could be no circumstances in which a policy of this kind could properly be put forward.

Take an example: suppose the decision letter had said, amongst other things, the government has taken and Jobcentre Plus has taken the view that there are certain jobs which are, I think my Lord put it in the oral hearing, beyond the moral pale. That might raise very different questions. Whether or not that would survive the challenge, would raise, no doubt, different issues, but the fact that those different issues might be raised suggests in itself that the policy itself is not or may not be, or, my Lord, it is not in a position at the moment to say, it would be, for certain, intrinsically irrational.

If that is the position the better course, in my submission, and a course which completes justice as far as Ann Summers is concerned, is to make the quashing order in the narrower form.

MR JUSTICE NEWMAN: Yes. The question I have to ask myself, and I have to answer positively, I take it to be that this policy cannot be operated in a way which the court can foresee as being lawful. If I was satisfied that this policy simply has no chance of being operated in a lawful way --

MR EADIE: Whatever the evidence.

MR JUSTICE NEWMAN: -- whatever the evidence, whatever the case, then I should declare it to be unlawful.

MR EADIE: If my Lord reached that firm conclusion --

MR JUSTICE NEWMAN: If I reached that firm conclusion, that should be the decision on relief. The question is: how far short of that -- I suppose I am almost to be regarded as in an advisory position, insofar as my judgment stands for consideration by your clients, for they themselves to work out whether there are any circumstances which could be devised, by way of policy or reasons for the policy to subsist, which would survive the reasons that I have given in the judgment.

What you are, in effect, saying to me is: well, maybe when we go back to the drafting table and look at the problem again, in the light of the judgment, it may well be that the policy will be capable of being upheld.

The difficulties I articulate to you: how is it then that when someone other than Ann Summers, assuming that Ann Summers' business is being advertised, how do other businesses which fall into the same category then fall to be determined by a policy which is prima facie calling for a ban on advertising of their business? Because if Ann Summers is not going to be banned for the reasons given, and cannot be banned for the reasons given, I suppose one asks: well, who can be banned for being in the policy?

MR EADIE: The difficulty I have is; that is not a question that I, or indeed I suspect those behind me, can answer today. They are going to need to take away my Lord's judgment, study it carefully, consider whether the answer to that question is so self-evidently no, that that bit of the policy simply cannot survive under any circumstances, whatever the justifications put forward.

So, although my Lord's analysis is one which I entirely accept, the fundamental submission is that it would not be justified for my Lord to say: I can today be sufficiently confident about the answer to that question to justify doing more than is necessary, from which you can do justice. I make no bones about it; the reality, of course, we all accept, is: that whatever the form of declaration, not merely Ann Summers' position, but also that final bullet point in the policy, will plainly need to be reconsidered.

So it may be that we are having a heated argument which does not have a lot of substance attached to it, but, nevertheless, for the reasons that I advance, a more appropriate form of relief here would be the narrower form of quashing order.

MR JUSTICE NEWMAN: What happens then to Ann Summers, so that this is clear to the court? When you say the matter will then be reconsidered, will there be reconsideration being given to whether or not Ann Summers' advertisements are going to be taken?

MR EADIE: Yes, there will, the effect of the quashing order is that --

MR JUSTICE NEWMAN: So you wish to keep open for reconsideration whether a further decision, based upon different reasoning, could escape the criticisms that are contained in this judgment and amount to a lawful ban?

MR EADIE: My Lord, I do, and I wish to keep all the options open. In other words, I wish that Jobcentre Plus should, as a result of my Lord's decision, be entitled to look at my Lord's judgment and say: well, where does that leave us in respect of everyone, including Ann Summers? Because, otherwise, the consequence is that my Lord will have concluded that the policy, however expressed, however justified, is intrinsic.

Now everyone is going to be mindful of the way that my Lord has approached it, and the points that were made in the judgment, but, in my submission, the consequence of the quashing is reconsideration.

MR JUSTICE NEWMAN: In the meantime?

MR EADIE: In the meantime the position must be held, and that necessarily follows, that is the way it always works in relation to a quashing order. Unless and until the reconsideration has occurred and a decision has been reached which itself can be challenged, the position must be held, because otherwise the matter is pre-empted. My Lord, that is the way that quashing orders --

MR JUSTICE NEWMAN: Well, I know, this is why I have you here, the two of you, because this is what I anticipated. You see, the difficulty that arises from what you have just told me and confirmed, is that on this basis the evidential aspect of the case, and by that I mean that aspect of the case which I identify as not supported by evidence, namely, really how this can be operated, and the extent to which it does actually give rise to difficulties with jobseekers, is never going to be bettered if the position is that so far as Ann Summers is concerned the ban stays until another decision is reached.

Then we get another decision which comes up with different reasons for the ban, and presumably different reasons for the policy, or additional reasons for the policy, then that element of the judgment will survive, because we will still be doing it against the basis of a situation in which, as I have concluded, in effect assumptions were made about the degree of difficulty which the taking of the advertisements was likely to have upon the business.

Now that area of the case, which I was alive to in your favour, namely, so that I could see that that might justify no declaration that the policy was unlawful, because it needed at least a bit of time to operate, to see how it could operate -- whereas I saw that as an argument against making a declaration of its unlawful nature of the policy, if what you are really seeking is to maintain the ban, in the meantime, defeats that aspect which was, as it were, praying in your favour, and being open with you, leads me to a position where it seems to me that you say Ann Summers is not being deprived of the fruits of the victory, she is going to have no fruits at all if there is no ban. If there is a ban and the ban in effect continues pro tem to another decision, then there is another decision and she has to challenge that. I mean one can theoretically go on for ever. I have not come to a conclusion about it, but I do find this very, very difficult.

MR EADIE: Suppose for the sake of argument that the evidential assessment that my Lord found was lacking and had been based on assumption rather than evidence; suppose, for the sake of argument, that that evidential search occurred, and suppose also for the sake of argument that it threw up features which did make it clear that there were real, genuine difficulties; I am not saying that is going to happen, but suppose that was the position, and suppose that those evidential features would then have supported that policy, or the application to Ann Summers; what then, is the question?

If in the meantime the ban has been lifted and yet that evidential search reveals evidence rather than assumption to support the assumption, that would leave the very odd position --

MR JUSTICE NEWMAN: Sorry, I do not follow.

MR EADIE: One has the ban; it is then, by way of remedy, lifted immediately, as it were, and then the evidential search occurs and it turns out that the ban was justified for evidential reasons anyway.

MR JUSTICE NEWMAN: Well, let me try and put it into some sort of factual framework. In essence I am concerned that the policy and the ban are both based upon the essential premise that difficulties would arise in relation to jobseekers, and in connection with the encouragement, notification and sanctioning process and the embarrassment that could arise to jobseekers, if that aspect of the defendant's operation is maintained as they say they would like to do it.

The three aspects which underpin my decision are: (1) well, you are faced with that difficulty, whether you like it or not, because even if you do not run the adverts, classified newspapers in various parts of the country are going to run the adverts. How are you going to deal with it? You are going to have to deal with it in some way, you might just as well deal with it internally as externally. That is point 1.

Secondly, the assumption you have made that it is going to give rise to great difficulty because there are going to be lots of objections from jobseekers, whilst it may be right, it is something which is based on an assumption, namely, that such a significant number of jobseekers are going to find this work embarrassing, that they are going to give rise to strains on the system. That is the evidential area.

The third part of the judgment, it is a little more open on this, is: why on earth do you do this when the simple way out of it is just to withdraw the encouragement, notification and sanctioning process from it?

All that reasoning, seems to me, Mr Eadie, to point to a situation in which the proof of the pudding, to use an awful expression, the proof of the pudding is going to be in seeing how it works. What prejudice is there, if the work is undertaken for Ann Summers, and in the meantime close attention is paid to the way in which it can operate, and to the difficulties to which it actually gives rise? Then if the position turns out to be one which is giving rise to difficulties other than those which were really contemplated in the letter, the ban can be reimposed. They are at liberty to say: this is not working and this is interfering with our business in a way that is unacceptable. They reimpose the ban on the basis of a different decision, and we come back to court, as it were, if that is what Ann Summers does, on a different basis.

What I do not find very attractive is the idea that there is a ban and it continues, despite the fact that there is no legal justification for it at the moment, and you are not actually creating a set of circumstances in which, in the court's view, there is really much of a chance that the position is going to change.

I mean, I am giving you the benefit of this because I have been thinking about this rather longer than you have had the opportunity of doing; your clients obviously have had a very limited period of time to consider this with you, but I have reservations about letting the matter go off in the way you propose, which, as you can see, are quite significant.

MR EADIE: My Lord, yes. I do not think I am in a position today to say: well, it is self-evident that there will be prejudice from the court, as my Lord puts to me. I think the only thing I can say in relation to that, is that it does lead to the situation where, albeit with a possibility of reintroducing, one, in effect, pre-empts other possibilities arising out of the reconsideration process, which is inevitably going to happen.

MR JUSTICE NEWMAN: Well, if in the reconsideration process -- what you are really saying is, by way of example: if what is the momentum underlying this is that this is beyond the moral pale to which -- this is taking us into an area of business activity which simply for moral reasons, social reasons, we do not wish to be involved, which is not the basis of this decision, but may have, in a way, influenced it, then --

MR EADIE: Then that is a matter that needs to be thought about.

MR JUSTICE NEWMAN: Then that is a matter that needs to be thought about. Well, I can see that if you do that, if that is the possible basis for your future ban, then I can see how you would feel compromised if, in the meantime, you have to --

MR EADIE: I stress --

MR JUSTICE NEWMAN: I know you are just talking theoretically --

MR EADIE: But if one can identify a basis such as that, on which it would not be self-evident that the policy would be irrational...

MR JUSTICE NEWMAN: How long do you need to reflect? How long do your clients need to reflect on how they want to approach this judgment?

MR EADIE: My Lord, I anticipate that the matter can be dealt with relatively quickly. But my Lord will appreciate from the decision letter itself, that the decision letter and the issues to which it gave rise were matters on which ministers were in fact consulted. With the best will in the world, that does take a little time. What I had in mind was a period of, say, 28 days, within which decisions would need to be made. It ties in with another point that I may or may not be able to tie in a little later, about whatever happens in relation to permission to appeal.

MR JUSTICE NEWMAN: Yes.

MR EADIE: There is provision, as my Lord will know, in CPR 52.4 for my Lord to extend the time for lodging or filing an appellant's notice, which, in the default provision, is 14 days, but in appropriate cases can be extended by the lower court.

My Lord, I would make the submission now, I would submit that given the nature of the beast, and given that ministers will almost certainly have to be consulted, and given that this does have some broader ramifications, a period of 28 days is not an unreasonable period within which to complete that exercise. By that exercise I mean whether or not to appeal, irrespective of whether or not permission to appeal is granted by my Lord or not, and what to do about the policy.

Everyone is well aware that there is a need to deal with this matter as soon as may be, and that is a process that is being undertaken, and started this morning at 9.30, or whenever the ban was lifted, but a period of 28 days to consider both appeal and also where one goes on the policy of Ann Summers, in my submission, is not an unreasonable period in the circumstances.

But, as I say, for that short period, if the position is held, there does not appear to be any suggestion that there is an immediate and overriding pressing need to do within the next 28 days what they have been unable to do in the limited period before this, and that additional period may achieve some significant benefit, it is hoped, for all concerned. So that is the timescale.

MR JUSTICE NEWMAN: So that is the timescale, and that is the reality of the position?

MR EADIE: My Lord, it is. As I say, if one can identify possible reasons which would lead to, say, something other than, I can tell you now, that which is going to be irrational, then the sensible course is, for that short period of time, to maintain the position by way of the narrower quashing order.

MR JUSTICE NEWMAN: Let me hear Miss Gallafent. She must be dying to say something.

MISS GALLAFENT: My Lord, so far as my client is concerned this matter has already gone on forever. It was last May when Miss Gold first wrote to the Chief Executive and asked for the ban on Ann Summers advertising to be lifted. It was at the end of June that the Chief Executive replied, and your Lordship set out that letter at paragraph 6 in your judgment, indicating that they did not consider it was appropriate to handle Ann Summers vacancies.

There then followed extensive consultations, prompted by solicitors acting on behalf of the claimant, which moved the defendant to reconsider, not only the ban on Ann Summers, but its policy more generally in relation to these matters, and that was undertaken during September or October and at the beginning of November 2002.

That was ended by the letter of 14th November 2002, which set out at very considerable length, not only the outcome of their decision in relation to Ann Summers vacancies, but their general review of what policy it would be appropriate to have in this area.

The letter of 14th November 2002 does not, of course, restrict its reasoning simply to Ann Summers vacancies, although it deals, of course, in the context of Ann Summers having made an application for the ban to be lifted. It deals with the general reasoning in relation to the policy which the defendant considered, in November 2002, that it should have in this area. That was after, as my learned friend made clear, ministerial intervention and consultation.

It was also, after a very lengthy period, for the defendant to consider all possible reasons for having a policy, whether to ban or not to ban in this area. It is clear from the length at and care with which the letter of 14th November 2002 was written that they took that opportunity. And, to put it simply, if they could have thought of another way to justify the policy of the ban on Ann Summers, no doubt in November 2002 they would have done. There are any number of reasons in that letter.

The suggestion made by my learned friend this morning is that the defendant should have another crack at the whip, and be allowed a further period now to go back and review what is essentially the same policy throughout the period, back in May of last year, and should have a further opportunity to consider whether it can come up with any better justifications that do, other than the justifications that are found, withstand rational scrutiny.

My Lord, in my submission, that is asking somewhat too much. The evidential issue was never addressed by the defendant. No doubt if it could have been it would have been. The same issues arose and were dealt with in correspondence throughout this period, and I do say it is highly unsatisfactory to put the claimant, having succeeded in this challenge, in a position where essentially it is deprived of the fruits of its success. Because the position, so far as my learned friend has made clear, is that this matter will simply go back to ministers and be reconsidered with a view to finding a different justification for the same policy; that is the ban on the advertising of its vacancies.

My Lord, whilst one appreciates my learned friend's candour in noting that that is the position, that simply cannot be an appropriate basis upon which to refuse the relief which I do say, as a matter of logic, follows from your Lordship's judgment, that the policy itself, for the reasons set out in 14th November 2002, not all of which are particular to evidential matters, either generally or in relation to Ann Summers specifically, but are in relation to an approach in relation, particularly to an elevation of sanctioning over its proper purpose, and an approach which even of itself could not withstand rational scrutiny.

For those reasons I do say that it could not be justified, particularly taking into account the background to the way in which this policy was formulated, it could not be appropriate to allow a third opportunity, in effect, to this defendant, to come up with a better reason for banning the claimant's advertisements, whilst, in the meantime, the claimant, Ann Summers, derives no benefit whatsoever from having fought and won, before your Lordship, and showing that the current policy and its application to Ann Summers -- but it is not merely its application to Ann Summers, it is the policy, I do say, reflected in your Lordship's judgment -- that that policy cannot withstand rational scrutiny.

So, for those reasons, I do say that the course urged upon you by my learned friend should not be adopted, and that it is appropriate to make a quashing order in the broader terms, that is the final bullet point of the policy.

Your Lordship may remember that, of course, we asked at one point who else might fall within the policy, or who else had, as it were, applied to be advertised and been refused on the same grounds, the final bullet point. We were simply told that there was no information at that point, although the policy itself makes it clear that a list of employers who would not be accepted would be collated by the defendant. We have never had any indication that any other business, save for Ann Summers, has sought advertising at Jobcentre Plus and been refused on the basis of the final bullet point of the policy.

In those circumstances, I do say that the speculation that there might be some other business who has applied and been refused on the basis of that same policy, simply does not assist the defendant. The position is simply that this claimant has succeeded in showing that that policy, for the reasons set out in 14th November 2002 letter, is unlawful, and this claimant is entitled to the benefit of your Lordship's finding in that respect.

MR JUSTICE NEWMAN: If --

MISS GALLAFENT: My Lord, I have not dealt with the question of appeal.

MR JUSTICE NEWMAN: That is the very matter, you read my mind altogether, that is what I was about to say.

MISS GALLAFENT: Well, my Lord, I was going to say that this matter, clearly, is not an appropriate matter on which permission to appeal should be given. Your Lordship has carefully analysed the policy and justification for it that is set out very extensively in correspondence, and has applied the appropriate test. As yet I have not heard from Mr Eadie on what grounds it is said there may be an arguable point to appeal upon. But, in my submission, anticipating what he might say in that respect, I simply say that no arguable error is disclosed by your Lordship's judgment. But I am not in a position to anticipate --

MR JUSTICE NEWMAN: No, you cannot anticipate that.

MISS GALLAFENT: -- what he might say in that respect.

MR JUSTICE NEWMAN: I will hear Mr Eadie on that. I think I need to cover the ground, because I think -- it brings in appeal considerations. Mr Eadie?

MR EADIE: My Lord, one other point which perhaps should be mentioned is the practicality. The debate between my learned friend and myself is whether the quashing order should include or exclude specific reference to that final bullet point. Whichever way the quashing order is to be formulated there will then, as a result of the quashing order, be a void as it were, in that respect.

MR JUSTICE NEWMAN: Could you hand up your first volume which has the decision letter in, because I have not got that with me, and I need to have that before me.

MISS GALLAFENT: My Lord, if I hand this up, perhaps we can share.

MR JUSTICE NEWMAN: It is only the decision letter. I just want to read that bullet point in the context of the letter. So far as quashing is concerned -- have you got a copy now, you probably do not have a copy?

MISS GALLAFENT: My Lord, I am very grateful.

MR JUSTICE NEWMAN: The second paragraph:

"The decision, so far as its affects your client, is that Ann Summers should not be permitted to advertise..."

So the second paragraph of the decision letter, 14th November, contains a decision which should be quashed. There is no dispute about that?

MR EADIE: No.

MR JUSTICE NEWMAN:

"This letter sets out a summary of the reasons for that decision."

Then they set out the facts, the review, and then we move right the way through the letter, paragraph 12, as it is numbered here, page 40:

"Against this background... we have reviewed the policy... We concluded that a clear policy was desirable and that Jobcentre Plus should not advertise vacancies."

Then the bullet point as quoted in the judgment.

The issue between you, Mr Eadie, is whether the whole or any part of the bullet point itself should be quashed, is that it?

MR EADIE: Yes.

MR JUSTICE NEWMAN: Miss Gallafent, you are asking for what part of the bullet point to be quashed? On your main argument you want the whole policy quashed, but if you were having merely the decision so far as it affected your client, then you have paragraph 2, as it were, quashed and that is it, is that right?

MISS GALLAFENT: Well, my Lord, at paragraph 15 of your judgment, of course, you find it is simply not just the application of the policy to Ann Summers, it is the policy itself. I do say that that is an important distinction, and that paragraph 2 of the decision letter is the application of the policy to Ann Summers.

MR JUSTICE NEWMAN: Yes.

MISS GALLAFENT: There is no suggestion that the policy was misapplied and your Lordship finds clearly it was not misapplied. Ann Summers, your Lordship finds, fell within that final bullet point.

MR JUSTICE NEWMAN: Yes.

MISS GALLAFENT: That final bullet point, and that was my submission before your Lordship previously of course, I do say, was written in order to include Ann Summers.

My Lord, it is a slightly hair-splitting debate to that extent, as to whether the final bullet point is, in effect, the policy in relation to Ann Summers or in relation to Ann Summers and other businesses, but the point is at page 41 in the letter, on the fourth internal page of the letter, it is clear that the basis is:

"Ann Summers falls in the last of these categories and, as such, falls within the policy."

Your Lordship's decision finds that it is that policy and that policy under challenge that is irrational. So I do say, it follows that that final bullet point should be quashed. I am not, of course, dealing with the previous bullet points at all.

MR JUSTICE NEWMAN: No, no. I see.

MISS GALLAFENT: I simply say that that follows, both from the content of the letter and the way in which the defendant chose to approach it, chose to, firstly, rewrite their policy and, secondly, to take a decision thereafter in relation to Ann Summers. The processes may well have melded together somewhat, but they are two distinct issues. But your Lordship has clearly found that it is the policy itself which is irrational. So I do say that the relief which should flow is in relation to the policy and this final bullet point.

MR JUSTICE NEWMAN: So you want the whole of the bullet point to go, plus obviously paragraph 2, the decision?

MISS GALLAFENT: My Lord, yes.

MR JUSTICE NEWMAN: I have it. I understand now, having seen the format of the letter I follow. Yes, Mr Eadie, coming back on that, you are submitting that it should be paragraph 2 of the letter and that is all?

MR EADIE: My Lord, yes.

MR JUSTICE NEWMAN: And for the reasons you have adumbrated. But that is the difference between the two of you which we have already covered?

MR EADIE: Exactly. Whichever one, which is why I have submitted that although we disagree about something that matters -- because, whichever one my Lord adopts, plainly there are links between the two positions, whichever position one adopts one will simply be left, as a result of a quashing, with a void, which will then need to be filled or not filled or dealt with. That would be the effect of the remedy whichever way my Lord puts it. But my primary submission is that it should be limited to the narrower, because that bullet point is not simply restrictive in terms to Ann Summers.

MR JUSTICE NEWMAN: No, but on the other hand, the evidence, as Miss Gallafent points out, even after enquiry, admittedly a not particularly probing enquiry, but an enquiry, did not disclose that anybody else was subject to the policy.

MR EADIE: Well, my Lord, yes. But the reason for that, that fact and that answer does not suggest that there are not other people who obviously might apply.

MR JUSTICE NEWMAN: I am sure there are. I am sure there are people elsewhere doing this sort of business.

MR EADIE: All the department were simply saying was that no one else we know of has yet come within it. That is not to say that there will not be other people in the future. The policy is generally expressed. It is expressed in terms which plainly are apt to apply, or capable of applying, more broadly than Ann Summers.

MR JUSTICE NEWMAN: Yes, all right. Now do you want to go on to appeal then?

MR EADIE: My Lord, yes. I am not going to rehearse the arguments that were run, all on fertile ground, at the hearing, but I do submit, very briefly, in relation to permission to appeal, that the significance of my Lord's decision, it was an important decision, it has important ramifications, it potentially has ramifications more broadly than the Ann Summers case, that this is the sort of case in which it would be appropriate to grant permission to go to the Court of Appeal to run those arguments.

I am not going to go through my Lord's judgment and identify -- it seems to me a very unattractive way of doing it anyway -- identify suggested errors in my Lord's reasoning, but we are particularly concerned about the suggestion that Jobcentre Plus misunderstood its role and did not conduct an appropriate balancing exercise, and did not, for example, take into the account the position, as clearly set out in that guidance, which is that you need good reason to stop the employer from obtaining the benefit of it. That is one area of concern. Another area of concern is whether or not it is appropriate to apply, or stigmatise as irrational, the various choices that needed to be made. A lot were, as your Lordship will appreciate, based upon judgment, and were not capable of being founded squarely on evidential considerations, but did involve the exercise of judgment by those involved in running this business.

My Lord, fundamentally, the reason for appeal, in my submission, for granting permission at this stage, is the importance, both in this case and more generally, of the decision my Lord has handed down.

My Lord, the secondary point in relation to that I have already covered: That whatever my Lord does in relation to permission, I would ask my Lord to exercise his discretion on CPR 52.4 to extend the time for lodging a notice of appeal from the 14 day period set out at 52.4 by another 14 days, to enable the sort of decision that needs to be taken, to be taken and properly taken, and will involve, I anticipate, consultation with ministers.

In my submission, no one is going to suffer any great prejudice with another 14 days. With luck it may achieve a significant benefit to all parties.

My Lord, that is what I say in relation to permission and that second point about extending time.

MR JUSTICE NEWMAN: Thank you very much.

MISS GALLAFENT: Just dealing with the question of permission. My learned friend has identified concerns on the part of the defendant; the defendant's concerns come to nothing more than their concern that they have lost. My Lord, it simply is not adequate to say that the defendant is concerned by the finding of your Lordship that it misunderstood its role. There is no suggestion that there is an error of law in your Lordship's judgment to that effect. Equally, the concern that it is not appropriate to stigmatise it as behaving irrationally, again the question is: why not? No answer is forthcoming. It simply could not be appropriate to give permission on those bases.

As for the suggestion that this is an important decision with ramifications for persons other than Ann Summers, well, my Lord, yes. But I return to the point that -- it is an important case, of course, for Ann Summers to be advertising at Jobcentres -- no suggestion has been made that the significance is enormous so far as other businesses might fall within that final bullet point.

My Lord has the point, that that final bullet point was apparently and appeared to be written to include Ann Summers. It is difficult to reel off a list of businesses, other than Ann Summers, which might be considered to be falling within that final bullet point. As I have indicated, we did ask, and the answer was: we will consider other employers as and when they seek to advertise in Jobcentre Plus.

There is no suggestion that the sky is going to fall in if that final bullet point goes. It is a very narrow policy. This simply is not an appropriate case in which the Court of Appeal should be troubled with considering that bullet point, insofar as it concerns businesses over and above Ann Summers. It has other matters of grave importance to be heard, that deserve the time of the Court of Appeal. So I do urge your Lordship not to grant permission in this case.

If your Lordship is minded not to grant permission in any event, I do say that the 14 day time limit for the lodging of an appeal notice to the Court of Appeal -- well, the time limit was shortened, I do submit, for a reason, under the new procedure rules, and that was to ensure that matters be dealt with speedily and that parties were not left in limbo as to the outcome of the first instance decision. If it is clearly a matter that your Lordship thought was appropriate, because ministers are involved, to double the length of time required, but, of course, in judicial review it is very often the case that ministers may be involved in considering whether to appeal matters in the Administrative Court.

So I do say, there is no particular reason in this case why the time should be extended in this case.

MR JUSTICE NEWMAN: Thank you very much.

At the conclusion of my judgment I invited counsel to attend today in order to address me on the question of relief. The need for counsel to do so has been amply demonstrated by the range of argument which has been deployed as to what the court should do, having regard to the conclusions to which it had come about the decision letter of 14th November 2002.

The critical question seems to me to be that the letter can be divided into two parts: the decision, in the second paragraph of the letter, namely the decision that Ann Summers should not be permitted to advertise through Jobcentre Plus, and the last part of the letter, which adumbrates the policy which had been drawn up after review; the last bullet point, describing the businesses in these terms:

"In businesses involved, as a significant part of their business, in the manufacture, distribution, display, demonstration, promotion, or sale of sex related products usually available to the general public only through licensed sex establishments and not commonly found elsewhere on the high street."

That was formulated as representing the policy in connection with all businesses falling into that category, of which obviously Ann Summers was the most prominent. Firstly, because Ann Summers had approached in order to advertise, the scale of Ann Summers' business is obviously significant, and the ban which was put forward in the letter was upon the basis that Ann Summers fell within that category of the policy.

The issue now between counsel is whether the court should, by way of relief, quash simply paragraph 2 of the letter, namely the ban on Ann Summers, or whether it should also extend its relief so as to quash that part of the letter which I have just cited, which describes the category of businesses into which Ann Summers falls.

The reason advanced by Mr Eadie for a narrow form of relief, leaving the declaration of policy untouched, is that the defendant desires to consider its position in the light of the judgment, and to consider whether the policy, as advanced, is capable of being justified for reasons which would escape those which have been criticised in the judgment.

With a degree of candour which the court appreciates, and in the circumstances of this case it entirely understands, Mr Eadie suggests, by way of example, that a fresh look at this position might lead to a decision being reached that the policy can be upheld as lawful for a reason not yet advanced to the court. By way of example he suggested it might be concluded that certain business activities involve conduct falling below a level of moral principle acceptable to the defendants and which would lead them to conclude, on that ground, that they did not desire to be associated with the sex industry and the sex products. This, he submitted, could be a ground upon which they could uphold the policy, if they were so advised.

Miss Gallafent, with some justification, draws the court's attention to the fact that this policy was borne of a quite lengthy review through a period of months, and therefore the outcome has been one which has been uncertain for some time so far as the claimants are concerned. She submits that further opportunity should not be given, by way of relief, for the defendant to go back to the drawing board when they have had plenty of time to do so, in order to find reasons which could withstand challenge, or a reason which could withstand challenge, in this court.

In my judgment, the matter falls to be resolved by these considerations: firstly, it will be plain to those who read my judgment that I have concluded that none of the reasons advanced by the defendant in support of its policy withstood rational scrutiny. In my judgment, the decision was flawed in substantial respects. But it will also be plain from my judgment that I recognised that the nature of the business in which it was being invited to become a participant, insofar as it would take job vacancy adverts for it, had a character which it properly and accurately identified, and which was one that, so far as Ann Summers was concerned, had been underplayed.

The reality of the position is that this business is involved, as the judgment states, in the sale of sex products. It is not involved in any way unlawfully in so doing, but it gives rise to issues which, as I have indicated in the judgment and in argument, entitled the defendants to consider whether they wish to participate in this area of the job market.

That said, the judgment in itself leaves little alive for any of the reasons which were advanced. It specifically does not embrace any considerations of moral judgment or social perceptions as to this, which might form part of the decision maker, because that area of reasoning was disavowed. If, as I understand the defendant may want to do so, in consultation with others, to reflect on the position, they are entitled to do so.

I have concluded that if that is the position they desire to take, I can see no prejudice in the relief extending beyond that which Mr Eadie urges me to limit it to. For the policy, as it stands in this decision letter, cannot be justified in accordance with the terms of the letter itself. The policy as formulated, after such an extended review, in all fairness should be regarded as inextricably bound up with the reasons advanced for it.

If there are other reasons why a policy so formulated can be justified, then it seems to me that course remains open to the defendant; it is free to go back and to reconsider whether it reformulates or restates this policy, so far as it affects Ann Summers and others, and to do so in accordance with reasoning which this court has not considered.

I can see no prejudice arising from that course, and it seems to me that that, in essence, should be the form of relief which is given.

The second point which arises, and it has not been unconnected, is what this court should do by way of permission to appeal. Some of the matters I have already adumbrated seem to me to bear upon that. The court is sympathetic to the contention that there may be wider and more important matters for public consideration in the impact of the decision, but that again is not the basis upon which the decision itself was taken.

The decision was taken upon the basis of what purported to be rational grounds for saying that the business could not properly, or sensibly, be operated in accordance with its purposes if these advertisements were taken. The wider issue, as I have indicated, was disavowed. The wider issue may be there, but, in my judgment, the wider issue does not arise on this judgment. It does not arise, therefore, so as to mount what I see as a basis for the Court of Appeal becoming involved.

I am bound to say that having regard to the conclusions to which I have come in the judgment, I have to consider whether or not there are any reasonable prospects of success. I need say no more than that I have concluded there are no reasonable prospects of success. I therefore refuse leave. Insofar as the decision may have wider implications, I also refuse leave, because, on the issues the court had to deal with, they have not arisen.

There must be relief by way of a quashing order as to the decision, including that part of the letter containing the policy in the last bullet point.

MISS GALLAFENT: My Lord, I have an application for costs in this matter. Might I hand up a summary schedule of costs? My Lord, I would say at the outset that I accept that this schedule was not served more than 24 hours before the commencement of this morning's hearing, it was served yesterday afternoon. But your Lordship will, of course, be aware that the judgment was only received on Monday afternoon, and as you will see the cost schedule falls into two parts, because it was necessary for two sets of solicitors to be involved in this matter. Originally Pinsents were instructed, and then because of the possible conflict in relation to another office in London, the matter was transferred to within Ann Summers Limited, which is why the schedule comes in two parts.

The first schedule from Pinsents obviously deals with that first section, and the second schedule deals with the in-house costs of Ann Summers Limited, in relation to an employed solicitor in that matter.

My Lord, I will anticipate if I may, then; my learned friend has obviously indicated that the question of 24 hours may become relevant, and he will no doubt make submissions on that point, but so far as the claimant is concerned, it would be appropriate to summarily assess the costs of the claim today, and I do ask for assessment for both sets of costs, both in relation to Pinsents and the employed solicitor at Ann Summers Limited.

My Lord, I can indicate the total figure -- if I can find out where I have put it down -- is £40,040.60. My Lord, in addition to that, I would add, it is not included in the costs schedule, but the costs of my attendance this morning, and the questions of dealing with the judgment, and those for my instructing solicitor, which would be in total an additional £700.

MR JUSTICE NEWMAN: Yes. You had better give me a moment, Miss Gallafent, just to run my eye down the figures.

MISS GALLAFENT: Absolutely. My Lord, perhaps the best thing for me to do is to await to respond to any criticisms --

MR JUSTICE NEWMAN: Yes. Just let me run my eye down the figures and the headings before I call on Mr Eadie. Do sit down. Miss Gallafent, what is the period of time covered by the Pinsents schedule? What are the dates?

MISS GALLAFENT: My Lord, my instructions are that the Pinsents schedule runs from the first time they were instructed -- sorry, your Lordship has my bundle 1 -- which was shortly after the response on 26th June 2002, the first response of the defendant indicating that the ban would be upheld, and it was shortly thereafter that Pinsents were first instructed to indicate that they would seek to challenge that.

MR JUSTICE NEWMAN: Have your file back.

MISS GALLAFENT: If my Lord wants to see when Pinsents --

MR JUSTICE NEWMAN: No, I do not need to see it. When did Pinsents withdraw?

MISS GALLAFENT: My Lord, it was shortly before the claim form was issued -- December.

MR JUSTICE NEWMAN: December-ish, all right. Yes, I see, thank you. Now, Mr Eadie, what do you want to say about the costs aspect?

MR EADIE: My Lord, we make three points under three broad headings. I fully accept and appreciate that if the hearing lasted for less than a day the court is obliged to consider whether or not summary assessment is the appropriate course to follow. I have submissions as to various alternative ways. The three broad headings are: first of all, this was a final hearing on the merits, so this is, in effect, a dispositive(?) of an action, and although that does not preclude summary assessment, it is at least a factor operating potentially in favour of a detailed assessment of costs, rather than dealing with the matter on a short, snappy, summary basis.

The second point is that this costs schedule was served very late, it was served yesterday afternoon. My Lord will be aware, and if he is not aware perhaps I might invite you to turn it up, that there is a mandatory rule requiring the thing to be served within a period of at least 24 hours beforehand. The purpose of that provision is self-evident. It is to give the person who is faced with a summary assessment the opportunity to properly consider it with those who are expert in these matters, and, if necessary and if appropriate, to raise queries about the bill or clarification or further information about the bill. That is the purpose of it. If the position is that the schedule is not served within 24 hours, that does not preclude the court making an order for costs.

There is a case referred to in the White Book, one may not need to go to it, but it makes it clear that if it is not served within a 24 hour period the court has a discretion. It must take into account the fact that that time is shorter, and if there is a suggestion of prejudice as a result of the shortness of time, the court has a variety of options.

One of them, according to the judgment referred to in the White Book at CPR 44.5.2, is to say: well, a short adjournment for quarter of an hour to go outside and take some instructions. That plainly is not appropriate here. The other option is to push the matter off to a detailed assessment, if that is considered the appropriate course.

The final of the three options identified by Neuberger J in that case is to hold the matter as a summary assessment, otherwise it will come back before my Lord once again for a costs charge, attractive or otherwise, as that may be.

MR JUSTICE NEWMAN: An attractive submission as you can imagine.

MR EADIE: But if that is the course the court decides is appropriate, then one of the options identified is that the prejudiced party, as it were, who has not had the requisite amount of time, could perhaps put his submissions in writing and that be dealt with in writing, if it is truly going to be dealt with that on basis. So the thing has been served late, and that has caused potential prejudice.

MR JUSTICE NEWMAN: Yes.

MR EADIE: In my submission, that would lead -- most appropriately, in this case, taking into account the first of the matters in the final hearing as well -- to this submission, that the most appropriate course is to send the matter off for detailed assessment.

The third of the areas which I was going to identify, which also supports that submission, is to make a number of specific points in relation to the schedule, or the schedules themselves. Those can stand, both as an indication that it should go off to detailed assessment, and also if my Lord concludes it should be summarily assessed, as points which my Lord will need to take into account.

MR JUSTICE NEWMAN: A point which seems to appear, it appears to me, Mr Eadie, and Miss Gallafent will deal with it if she can, is that I am looking at two different schedules of statement of costs in which there are really quite substantial figures which have been incurred by way of consideration of documents, telephone attendances, and correspondence and the like. It seems to me that on a summary assessment one simply cannot form a view as to whether all that was within the tolerable bounds of reason, or what on earth was going on. I do not know why, for example, when it was taken over in-house, work on the documents took, for example, 19 hours and 42 minutes. Obviously some time was necessary. That is without going any further.

That seems to me to indicate, subject to what Miss Gallafent says, that the only way the court here can do anything about it, as you say, is either call for more information, which means it turns itself into a form of taxing master, or what it does is, well, broadbrush.

MR EADIE: Quite.

MR JUSTICE NEWMAN: Looks at the total figure, 50,000 and says: well, cut it down in some way or another, save everybody a bit of time, save you further costs in doing it, and I knock off that which might be the sort of figure which is going to be knocked off if it does go to detailed assessment.

MR EADIE: My Lord, yes, but it would be --

MR JUSTICE NEWMAN: That is broad justice.

MR EADIE: It is very broad justice, close to being random justice.

MR JUSTICE NEWMAN: Or even arbitrary.

MR EADIE: My Lord has the main point that I was going to make.

MR JUSTICE NEWMAN: That is really what it is.

MR EADIE: Sometimes it is possible to do that -- the onus is plainly on the party who claims summary assessment to turn up with enough information for the court to make those judgments.

MR JUSTICE NEWMAN: Yes, I think so.

MR EADIE: Sometimes, it may be possible, if the figures are small and the items are relatively standard, to form a view one way or the other whether to keep the final hearing and all the costs associated with a major piece of litigation, as it were, then it plainly lends itself less to that process.

Can I make a very short point in relation to your Lordship's observations? Our starting point was whether or not there were legitimate questions about the total sum claimed, the proportionality and reasonableness of the total sum claimed, and whether or not there were significant grounds for doubting the specific items or components of them. If there were, the submission is: either reduce very significantly, because they have had their chance and they have not bothered to take it, and, if they want summary assessment, so be it, operate the presumptions against them as one would do on a standard basis, which I understand there is no dispute about, or simply send the matter off for detailed assessment to be dealt with in the usual way.

Our starting point on the substance of it is that as it appears from these two schedules, experienced counsel has been involved from the off, including in drafting letters, settling the claim form, doing all the things that counsel would usually do, but this is not one of those cases where counsel has simply come in at the last moment to represent them at the oral hearing.

It is evident that counsel has been involved from the outset, which explains the level of fees for roughly £10,000 from Miss Gallafent, which is broken down into three segments if one goes through the schedule. Well, that is fine, that is no doubt a sensible litigation choice. If it looks like the matter is going to end up in court, no one criticises that, subject to knowing hourly rates and what she was actually doing in the first place, no one particularly criticises that global figure.

But you cannot have your cake and eat it. If you say: I am instructing counsel and then pay them from the off to do things including writing letters, and you then claim, by way of additional amounts, for a partner in Pinsents Curtis to write letters for 64 hours for his clients and the other side, then for the person in-house to come on board and spend another 60 odd hours doing roughly the same sort of thing, then one is legitimately entitled to say, as the person who is going to be paying this bill: what on earth was all that time spent doing? We have seen enough of the correspondence to know that only about two or three letters were letters of any substance, as opposed to chasers and formal letters which would one could legitimately expect a junior to deal with, and those no doubt were the letters that were actually charged for drafting.

So there are real and serious questions about why it is that the partner in charge of Pinsents charged the number of hours that he did. There are also legitimate questions raised by the schedule, as to why it was thought necessary for the partner, and the partner alone, of Pinsents, to handle all aspects of this matter. It is evident, if one goes, for example, to the first of the costs schedules and then compares the hourly rate charged by the in-house solicitor for Ann Summers, there is a very significant discrepancy between the two. One of them is charging £295 an hour, the other is charging £100 an hour.

So the point, so far as that amount is concerned, can be put in two ways: either the partner of Pinsents, when he was operating, could and should have delegated a substantial amount of this cost to junior people who charge significantly less, or he could and should have delegated it to the in-house person at Ann Summers who was charging precisely one third of what he was charging.

The suggestion cannot be made: well, I am terribly sorry that the person at Ann Summers was not competent to deal with it, because when he or she took over, he or she took over for good.

As I say, whether there are answers to that or not is not (inaudible), the reality is that serious questions are raised by this bill.

MR JUSTICE NEWMAN: Thank you. Miss Gallafent, do you want to resist strongly the idea of a detailed assessment?

MISS GALLAFENT: My Lord, perhaps I can resist, but not strongly.

MR JUSTICE NEWMAN: It does not seem to me, with respect, putting aside the 24-hour point, which obviously is in play, but not necessarily determinative, I do think that because of the involvement of two sets of lawyers, it itself immediately gives rise to a question as to whether in fairness that should not be looked at to ensure that there has not been some sort of unnecessary work undertaken or, you know, enquiry there.

For the reasons that I shortly adumbrate, and I think Mr Eadie has developed, my feeling is that this is a detailed assessment case.

MISS GALLAFENT: My Lord, I should make it plain for the avoidance of any doubt that the in-house solicitor at Ann Summers Limited was brought in specifically for this role, which is perhaps why the submissions do not go any further than Mr Eadie puts them. It was a specific recruitment for this litigation rather than that they were always there and available at a lesser rate.

MR JUSTICE NEWMAN: I think it is detailed assessment. I have not dealt with one thing, and that was whether you were to have another 14 days.

MR EADIE: My Lord, yes. My Lord, before you give an answer to that, could I just make one thing clear, or raise at least a query? What I am keen to avoid is the position where there is some form of uncertainty about precisely what has to happen or not happen, as a result of the order that my Lord has made.

My Lord has made a quashing order in the form that you have indicated, and the effect of that is that the final part of that policy has gone effectively. But, as I said in the submissions, the effect of that is that there is now a void. What should happen as a result of that will need some thought. I am concerned to avoid the position where a telephone call goes through tomorrow from Ann Summers in Jobcentre Plus saying: come on, take the advertisements.

The reality is that a quashing order is a quashing order and more than that. There is no mandatory order involved and no mandatory element to it, and on any view, even if the decision is: carry on carrying the advertisements, there are still, as my Lord will appreciate from the judgment alone, some serious practical questions about precisely how and in what form and how that should be done.

MR JUSTICE NEWMAN: I agree. Mr Eadie, I hope I have done your clients a favour by quashing that part of the policy, because it seems to me that as soon as they do receive any form of request for the advertisements, then they have a clean slate.

MR EADIE: Well, I am grateful. That is all I wanted to clarify.

MR JUSTICE NEWMAN: That seems to me to be the position. But it does put them under some pressure. Obviously they must make a decision and they must do so within a sensible and reasonable period of time, and they can do so with, as I say, a clean slate, as opposed to carrying the baggage of that which has been criticised.

MR EADIE: My Lord, I am very grateful for that.

MR JUSTICE NEWMAN: That is really what I had in mind. It is clearer for everybody, and everybody knows where they are.

MR EADIE: My Lord, yes. The reason for raising it at that point is because it does feed into the 28 days point.

MR JUSTICE NEWMAN: It should feed into your 28 days. I will give you another 14 days, simply because of the potential involvement of ministers, and the wider consideration being given to it. It seems to me that obviously you are entitled to take some sort of position without declaring it. It seems to me that you are entitled to take some sort of position and Miss Gallafent will understand this, on the basis that you are considering your position on appeal. But if you are going to appeal, then the sooner you get on and get something from the Court of Appeal, and, if necessary, some sort of interim relief, then that is down to you. In the meantime, you have a clean slate and things can be picked up from where they start.

MR EADIE: My Lord, I am grateful.

MR JUSTICE NEWMAN: All right, thank you. Thank you both very much.