England and Wales High Court (Administrative Court) Decisions

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

		Royal Courts of Justice The Strand London WC2A 2LL
		9 November 2005

Wednesday, 9 November 2005

MR JUSTICE CALVERT-SMITH:

1. This is a rolled-up case in which the claimant applies for permission and, if granted permission, for judicial review of a decision of the defendant in a letter dated 18 August 2005 to cease to validate a foundation degree course beyond 31 August 2006, and not to admit students to the first year of the same course due to start at the end of September 2005.
2. Whatever the result of this particular litigation and of any subsequent litigation there may be between the parties, both the principal parties and the students, who stand behind the claimants, are entitled to feel a sense of frustration, if not anger, with the situation with which they were faced on or around 18 August 2005.
3. The defendant, the London Metropolitan University ("LMU"), was faced with a damning assessment of the quality of the foundation degree course in question by the Quality Assurance Agency ("QAA") about which it had to make a difficult decision.
4. The claimant was faced with the bombshell that its first ever foundation degree course had been criticised and was no longer to be validated. Worst of all, there were prospective students, some of whom had travelled great distances from abroad, and most of whom had changed both accommodation and employment in order to attend a "unique foundation degree course". All parties were entitled to feel a degree of frustration and anger. The corollary of that is that whatever decision is reached in these proceedings, the losing party, with some justification, will feel that they have not had a fair deal.

The Facts

5. The defendant university is the comparatively recent product of a merger between the Guildhall University and North London university. At any given time, the court was informed, it has about 35,000 students. The claimant is a charity. WAC is a division of the claimant and itself a registered charity. Interchange Trust, the claimant, has been established for a quarter of a century. It provides access to services for disadvantaged people across the fields of social services, health, education, arts and the media. WAC, as a division of Interchange Trust, provides training for people from low-income families in the performing arts. The court was informed that it provides courses to approximately 1,000 young people a year. Over 20,000 students have been educated by WAC during its existence. It has maintained a focus on young people marginalised by society.
6. The course which the claimant and defendant agreed to provide from September 2003 was a foundation degree level course in the performing arts, in particular non-Western performing arts, and as such probably the only one in the United Kingdom.
7. The interested party, the Quality Assurance Agency, carries out the function of quality assurance ultimately on behalf of the government via the Higher Education Funding Council for England ("HEFCE").
8. The agreement between the claimant and the defendant in respect of the provision of this course is dated 1 September 2003. A number of its provisions have been referred to in argument. I will refer to a small selection as follows:

"Nature of the Agreement

2. The Collaboration will involve close liaison between Interchange Trust (WAC), the College of London and the Department of Humanities, Arts and Languages, the latter two being located in the University.

3. Interchange Trust (WAC) will be responsible for ensuring that the delivery and management of the programme is in accordance with the University's regulations and procedures. This includes the provision of appropriate academic and pastoral support for students.

Academic Standards and Quality Assurance

5. The University, as the awarding institution, has ultimate responsibility for the academic standards of the programme and the University's quality assurance procedures will apply.

6. The approval of the delivery of the Foundation Degree in Performing Arts (WAC) by Interchange Trust (WAC) is subject to periodic review at intervals to be determined, initially, by the validation panel. However, the University reserves the right to schedule a review of the course on the basis of the annual monitoring report.

....

9. The University will inform Interchange Trust (WAC) of any modifications made to the programme through the appropriate approval mechanisms. Any modifications have to be approved by the agreed processes defined by the University. The University maintains responsibility for recording any approved changes to the course."

Paragraphs 10-13 set out the procedure for assessment, as set out in the university's assessment regulations. Paragraphs 21-24 deal with the provision of staff by WAC and an appropriate programme of staff development, which might include curriculum development or research, exchanges and opportunities, and the copyright of any teaching and learning materials. Paragraphs 29 and 30 read:

"29. This Memorandum of Co-operation takes effect from 1st September 2003 and will be effective until 31 August 2006. The programme must be reviewed during the 2005-6 academic year.

30. The University and Interchange Trust (WAC) will reserve the right to terminate this agreement following a written submission of intent to terminate at least one year in advance and to take effect from September 1 in any given year. Each of the parties will seek to ensure that the interests of participating staff are not jeopardised through termination of the agreement and shall co-operate as far as possible to allow students enrolled on the Foundation Degree in Performing Arts (WAC) to complete their programme of study."

9. In September 2003 the first cohort of students was enrolled. At the conclusion of the academic year 2003-2004 a course monitoring report was produced which identified a number of issues which required attention, although there were a number of features in the course and its delivery which were praised. As the result no doubt in part of that monitoring report, a number of initiatives were taken during the academic year 2004-5 to address the problems. In the papers there is a record of an assessment training meeting for tutors on 5 October 2004; a second such meeting dealing with a different area on 3 December 2004; and a record headed "Staff Development Minutes" in respect of this course on 28 January 2005.
10. The Quality Assurance Agency had carried out its first review of foundation degree programmes in the previous academic year, and in the academic year 2004-2005. One of the courses it decided to look at was the course in issue in this case.
11. The procedure for Quality Assurance Agency inspections is set out in considerable detail within the bundle. It is worth noting that the inspections are said to take place between January and July 2005. In this particular case the inspections took place during the summer term, at the end of which the first cohort of foundation degree graduates graduated, this being a two-year course.
12. There are signs in the documents within the papers that, at least within the defendant's knowledge, the QAA inspection turned up a great many areas of concern. I am assured by counsel for the claimant, and accept, that, whatever may be said on the papers, this had not filtered through to the claimant's governing body.
13. In short, the concerns surrounded the academic element of the course -- the element which makes it a degree course rather than simply a vocational course. There was unstinting praise for the work-based performance side of the course.
14. That was the context for the receipt on or about 3 August 2005 by the Vice-Chancellor of London Metropolitan University of a letter from the QAA. It reads:

"Following the recent review of the Foundation Degree in Performing Arts validated by London Metropolitan University, and delivered by WAC Performing Arts and Media College, the reviewers have agreed their judgments on the standards and quality of the programme and their key findings. They have also prepared the first draft report. The purpose of this letter is to provide you with an early indication of the main judgments, which will be discussed in the published report.

Overall, the reviewers have no confidence in the emerging academic standards and emerging achievements of students in the Foundation Degree in Performing Arts.

The reviewers have no confidence in the quality of learning opportunities achieved in the programme.

Each of the judgments reported above will be set out in full in the published report together with supporting text. There will also be comment in the text on matters relating to the maintenance and enhancement of quality and standards in the programme. I hope to be able to send the draft to you by the week commencing 05 September 2005. At that time you will have the opportunity to comment on matters of factual accuracy. In the meantime I hope that the information contained within this letter is of use to you.

Finally, on behalf of the whole review team, I would like to take this opportunity to thank you and your colleagues for the positive manner in which you and they have engaged with the review process. In particular, I would like to thank all of the staff met by the team, and the Programme Co-ordinating Facilitator, Roddy Gallagher, for their co-operation during the conduct of the review."

15. That letter was expanded upon at a meeting between the QAA and LMU on 5 August 2005.

"The meeting was convened by the QAA to inform the University of the judgments following the QAA Foundation Degree Review of Performing Arts (WAC) and to provide initial feedback on the basis for the judgments made. The AD [Assistant Director] clarified that he could take comments back to the QAA but was unable to discuss the judgments at this meeting."

16. It is perhaps worth referring back at this stage to the QAA handbook for the review of foundation degrees in England, to which I referred earlier. At paragraph 21 the handbook describes the structure of the review process. After dealing with the way in which evidence is gathered, a time is reached at which there is "a meeting at which the reviewers consider their judgments". That is followed by "a letter to the provider containing the judgments", followed by "a draft review report sent to the provider for comments on factual accuracy" and "a published report of approximately 4,000 words". There is then a time line included in an annex to the hand book. This meeting, therefore, was part of this process described.
17. The minute of the meeting in part reads:

"Overarching issues identified by the review:

* The integration of academic with professional/practical skills. There was a view that the course is weighted too far in favour of professional skills at the expense of academic achievement.

* The review identified a lack of academic substance in assessment and teaching

* Weaknesses in learning resources."

Issues leading to: No confidence in the emerging academic standards emerging achievements of students: (Key questions 1-5)

* Learning outcomes and aims not fully implemented at intermediate level by all members of the course team

* Where modules incorporate history and theory the assessment does not allow students to reach learning outcomes; this is partly because it is too performance orientated

Confidential

* Curriculum has insufficient balance between performance and academic content

* Assessment processes insufficiently formalised (code of practice)

* Forms of assessment are not fully understood by students

* Levels of written work are not up to standards expected

Issues leading to: No confidence in the quality of students' learning opportunities: (Key questions 6-9)

* The learning and teaching does not support development of academic skills

* Students do not have enough access to appropriate books

* Students only have reference rights at Londonmet

* Londonmet library does not hold appropriate books for the course

...."

It is obvious from this, without going into the merits of any of those matters which remain to be resolved through a representation process which is about to begin, that those were substantial issues, in particular those concerning the emerging academics standards and achievements. There were a number of excellent features of the course pointed out in the same documents, and that has been confirmed by the recent arrival of the draft report.

18. Following that meeting there were internal meetings within LMU at the highest level to discuss what to do. According to Dr Aylett, whose statements effectively puts the university's position, there was a one-to-one discussion with the Vice-Chancellor of the university. Dr Aylett says:

"Our view was that this 'no confidence' judgment of the QAA, coming between two QAA audits (the 2005 Institution Review and the planned 2006 audit of the University's Collaborative arrangements with other institutions in the UK and abroad), would present a real threat to our representation and standing in the higher education sector and in the mind of the public for whom these reports are written."

19. It was then decided that the matter should be considered at the highest executive level of the university. It was discussed at the meeting of the university's executive group on 17 August 2005, at which Dr Aylett explained to the meeting what he thought the reputation damage to the university was caused by the judgment. The criticisms were fundamental and in effect concluded that the course failed to meet the academic standards required for a foundation degree. It is clear from what Dr Aylett says that in his mind, and in the minds of others at LMU, it would have been wrong to allow new students to start a course which was labouring under a "no confidence" judgment.
20. The following day, 18 August 2005, there was a second, long meeting with a number of people within the university, including Mr Gallagher, the gentleman who had acted as the liaison with QAA. Dr Aylett says:

"We went systematically through all the possible options available to the University in the light of the QAA judgment. The main concern for the University was the fact that new first year students would be enroling on the Degree soon. The first option was that the University allow the new students to enrol and then work with WAC to implement a 'recovery plan' to improve the quality of the Degree for all the students. The second option was for the University to refuse to enrol the new students but to work with WAC to implement a recovery plan for the existing students about to enter the second year of the Degree. We also discussed the possibility of finding alternative places for the new students who were about to enrol on the Degree."

In the end the decision was taken which resulted that day in the letter which is the subject of these proceedings. It is addressed to Celia Greenwood at WAC. The material parts read:

"You will see from the enclosed letter from the QAA, which we have been asked to deliver to you, that the review panel for the FDA in Performing Arts at WAC has come to a very adverse conclusion. This conclusion encompasses academic standards and achievements of the students and their learning opportunities and indicates that the final report, when received, will indicate 'no confidence' judgments. The advance notice given to the University by QAA does, however, also recognise the realisation of widening participation, the innovative content of the course and the professional level of performing skills.

In this context, the University has no alternative but to give you formal notice, in accordance with the terms of our contract, that it will not be validating this award beyond the expiry date of the contract which is 31 August 2006. There cannot be an intake to this programme in September 2005 as it would not be responsible of the University to enrol students to a programme with a 'no confidence' judgment against it. The University will, of course, work with WAC to safeguard the interests of those students already enrolled on the programme and entering their second year.

The University will have the opportunity on receipt of the report to make representation concerning the judgments and will do so. The University anticipates receiving the report early in September but the period of representation and finalisation will last over some months and is not likely to be completed before early 2006. It is most important that the University and WAC work together during this period to safeguard the interests of students who will be attaining their awards in the summer of 2005 and 2006 and to seek to protect the integrity of that award. An essential feature of this operation will be the maintenance of absolute confidentiality regarding the advance notice provided by the QAA, since the judgments are not absolute and public until the final report is issued and premature public disclosure would prejudice the outcome of our representations to the QAA."

There is then an indication that a meeting will be necessary with a view to formulating a joint statement as and when necessary and for the text of the letter to go to prospective entrants to be jointly agreed.

21. It is perfectly clear from that letter, as is maintained by the claimant and effectively accepted by the defendant, that the "in principle" decision had been taken and that there would be no way in which discussion with WAC or anyone else would change it.
22. On 24 August 2005 there was a meeting which was attended by Dr Aylett, Mr Gallagher and others from LMU, and Celia Greenwood and others from WAC. The WAC representatives clearly took the opportunity to try to persuade LMU to change the decision on the basis that it was an extreme measure to refuse entry to the course to the 20 or so prospective students who anticipated starting in less than a month. But they were told by Dr Aylett that the university was not prepared to run a course which had been given a "no confidence" judgment by the QAA as the currency of the award "would not be valid".
23. The university accepted that the timing of all this was "unfortunate", but informed WAC that the QAA were in control of the time frames and that this decision had been made as promptly as was allowable in the circumstances. Clearly the timing of all this has been most unfortunate for both the claimant and the defendants, albeit that they have accepted that there is nothing that could be done about it.
24. There followed correspondence, to which it is unnecessary to refer in detail, about the question of a joint letter from LMU and WAC to the prospective students, which came to nothing. The parties (and in particular the claimant) prepared for legal action.
25. 21 September was the date on which the students were due to enrol with WAC. It was on or about that day that they were informed that the course on which they were hoping to enrol was no longer being validated. In fact, WAC has, for now, run the course (albeit outside the umbrella of LMU).
26. I have already referred in summary to the effect of this decision on the prospective students, many of whom wrote letters which are in the bundle. The sentiments they express are understandable, and the moderation with which they are expressed (in contrast to some of the other correspondence in this case) is praiseworthy.
27. On 14 October 2005, after these proceedings had been issued, the draft QAA report was delivered to the college of London. It was first seen by LMU and Dr Aylett on the 19th, by which time the external examiner's report had been submitted for the academic year 2004/5.
28. A number of complaints are made by the claimant which, they claim, justify the application and in due course the grant of judicial review. First of all, they say that it is clear from the papers and the correspondence that the defendants either misunderstood or misapplied the QAA procedures. They point to the fact that the 3rd August letter was the first step in a fairly lengthy procedure, which involved a first draft report, a second draft report and a final report, and that in no sense should the letter of 3 August have been taken as some sort of "death knell" (as was put in argument) to the performing arts course. They point to what they say are errors in Dr Aylett's understanding of the situation when he states at paragraph 13 of his statement that the 3rd August letter is "not indicative; it is definitive. It is not a negotiating statement. The judgment of the QAA is not provisional." In taking the decision as early as they did, and in advance of receipt of the draft report, LMU undermined this procedure. In general terms they point to the structure of the QAA review process as showing that QAA process is all about to review discussions with a view to eventual enhancement or improvement of courses; it is not designed either at the first stage or at any other stage to lead to the abrupt termination of courses.
29. As I indicated before Miss McCafferty replied, I do not accept this proposition. In my judgment it is perfectly clear from the correspondence to which I have referred, together with the hand book, that the judgment is a formal part of the process; that the university's decision whether or not to run a course is a separate decision-making process (so far as it is a process at all) rather than the QAA process; and that in a proper case it would be perfectly justifiable, and indeed sensible, for a university, having received the letter and having had the discussion which gave rise to the minute of the 5th August meeting, to take a decision like the one taken in this case.
30. Secondly, it is said that the decision is flawed because of the lack of consultation before it was taken. Here the factual situation is not, and cannot be, in dispute. There was indeed no consultation with WAC or the students who might be affected about the principal decision as to whether to go on recruiting students to the performing arts course. There was, however, say the defendants, consultation (which was accepted by the claimant) on other matters such as the way in which the current cohort should be dealt with, the question of pursuing the QAA procedure by representations in respect of them and attempted consultation as to the best way of dealing with the difficult problem of the new recruits. In addition, under the general head of consultation (although some of these topics can equally well be included in the next ground of complaint, the failure to take into account relevant factors), complaint is made that the views of Professor Tompkins, the external examiner (who has made a very helpful statement for these proceedings, and who must have been in the process of preparing his report, which was finally produced on 17 October 2005 and was much more favourable in its terms than that of the QAA), were not canvassed before the decision was taken. Complaint is also made that too little notice was given of the decision; that up until 3 August 2005 the university had been content with its provision of the course and its provision of a degree at the end of it; and that the decision was a leap in the dark in view of the fact that the draft report had not been produced, let alone the other procedures which would follow its publication.
31. In reply the university say, first of all, that there was no statutory legal duty on the university to consult. That proposition is not seriously challenged by the claimant, albeit they say that so far as natural justice, bearing in mind in particular the contract and its references for close liaison, there was a duty to perform some sort of consultation exercise. In any event and more forcefully, they say, whatever the duty, the principal decision to cease to validate the course beyond August 2006 and not to take any new students from September 2005 was one on which no consultation was possible -- at least not a consultation which could conceivably have changed the decision. It was perfectly possible to predict the reaction of WAC, which would no doubt be, "Let us see what we can do to put the course right, not just for the second year students, but for the new recruits as well". Insofar as the students would have been asked for their views, clearly those who had travelled long distances and had changed their accommodation and their jobs in order to start this course would have been unanimous, as indeed they were. Neither would have been capable of assessing the other factors which were in the end decisive, ie, as Dr Aylett puts it, the damaging (indeed wrong) act of putting out a degree under a false prospectus, and, in doing so, to expose not just the course but the entire university to damage to its standing in the academic fraternity and with future employers. Were it to continue with the course the final report was almost certain to maintain those conclusions it would stand accused of running a course which it knew to be seriously defective.
32. One matter which concerned me as we went through the chronology in argument was the fact that WAC had never been informed of the extent of the concern revealed at the 5th August meeting. As far as they were concerned, the "no confidence" judgments might have been borderline. The criteria in the hand book indicate that if there is a failure so far as one key question within a particular subject heading is concerned, that will lead to a "no confidence" finding so far as the entire heading is concerned. It would have been very much better in retrospect, as Miss McCafferty accepted, if only from the point of view of good relations, were both parties to have been put on an equal footing on 28 August as to the depth of concern that existed.
33. So far as the question of consultation is concerned, it is also relevant to consider at this stage another dispute between the parties as to the status of this decision. Is it an "academic" decision to which great deference must be paid by a court? Or is it not such a decision, in which case, although the decision maker must be allowed a wide range in which to make his or her decision, it is not such a specialist decision that the courts should stay out of it?
34. In my judgment Miss McCafferty is right. Although the cases cited in argument on this topic were principally concerned with particular academic decisions in respect of particular students, there seems to me to be no difference in principle between that and a decision on the viability of a particular course affecting in this case some 20 students. The court should hesitate long before interfering in a judgment of a university whose standing depends upon the standards of the degree courses which it offers.
35. It would have been better had there been more openness so far as WAC was concerned as to the true state of affairs. It is impossible to predict what WAC's attitude would have been. It may well have been the same as it is now. Does that amount to such a failure of "consultations to vitiate the decision"? In this case I do not believe that it does. I accept the submissions of Miss McCafferty on behalf of the university that the consultation that did take place was sufficient consultation in view of the situation in which the university found itself. It had very little room to manoeuvre in terms of time and had the ultimate responsibility for the students and the eventual award of degrees. Whether that decision was in the end right or wrong is quite another matter.
36. Next, it is suggested that the university failed to take into account relevant factors, in particular the views of Interchange (which is the other side of the coin to a lack of consultation), and the interests of the students. Once again, reading the correspondence I can well understand why WAC would think that the university was solely concerned with its reputation almost to the exclusion almost of the interests of the twenty young people who were about to embark on this course. In fact, the papers indicate that that was not the case; there was a balancing of the various interests. It is worth summarising what Dr Aylett and the governing body of the university had to think of. They had to think of the funding council attitude in the future to a degree course which was found to be defective; they had to think of WAC's position; they had to think of the students currently at the university and the students about to start; and they had to look at their own standing in the academic community and make a speedy decision. The passages that I have quoted from Dr Aylett's statement make it clear that those relevant factors were taken into account.
37. The contract provisions is a relevant factor said to have been omitted. Of course this case is leaving severely alone the private law case, which may or may not develop, between the parties. Suffice it to say that for the purposes of this judgment I see nothing in the contract provisions and the decision itself to indicate that for the purposes of a judicial review hearing any serious failure took place in that regard. Of course the terms of the report were not taken into account, but anyone reading the minute of the 5th August meeting would have a clear idea at the very least of the paragraph headings of the draft report, and no doubt the summary of its conclusions.
38. Next, it is said that the twenty students had a legitimate expectation that they would be accepted on the course. In that connection the case of R(on the application of Bibi) v Newham London Borough Council [2002] 1 WLR 237 was cited. Of course the students had a legitimate expectation that the course they had been accepted on would occur. Against that it is said that the legitimate expectation cannot be said to have extended to starting a course which was as seriously defective as the QAA in their judgment of 5 August had found. Although a few days before the course started the students would have voted with one voice to go on the course, and have in fact done so, one can imagine the difficulty if, on the one hand, students had gone on the course without any knowledge whatever of the QAA attitude and two years later come out with degrees which were said be not worth the paper they were written on; or in the alternative, as was suggested on behalf of the claimant, that they should be told, "It looks as though this degree is seriously defective. Would you still like to go on it?" Again one can see what their attitude is likely to be; but whether that amounts to a legitimate expectation is seriously open to question. In the circumstances I find that there is no ground under the head legitimate expectation for this decision to be reviewed.
39. Other matters were canvassed. In case I am wrong about my conclusions on the merits I was asked to consider the practicability or good sense, even if I had found in favour of the claimant on one or more of their claims, as the practicality of ordering relief and as to what form any relief should take.
40. The defendants suggested that even if I found against them, it would be wrong to make an order which effectively forced two incompatible partners to work together. In that context the cases of R v Incorporated Froebel Institute, ex parte L [1999] ELR 488, Ross v Stanbridge Earls School [2003] ELR 400 and R(on the application of London Borough of Brent) v FED 2000 and The Temporary Governing Body of The Avenue School [2005] EWHC 2436(QB) were cited.
41. In the last case, in a judgment which was delivered in two parts by Lloyd-Jones J as recently as 4 November 2005, the court held that a school which had decided that it wanted to acquire voluntary agent status and had then changed its mind, could not do so because the decision had effectively come into effect. Miss McCafferty strongly submitted that this case was a very long way from that in which a rubicon had in fact been passed. But so far as the other cases are concerned, I am against her. The submissions that Mr Oldham made on this point were, first of all, that the marriage is subsisting in that second year students are going to be allowed to complete the course; and secondly, that this is not the sort of case in which there is a one-to-one personal relationship which would make it impossible for the relationship to be made to work by a court.
42. Secondly, it was said by Miss McCafferty that it would be impracticable at this stage in November to put the basis back together again and restart the first year students from 21 September because the university had no knowledge as of today as to how they had been getting on under the WAC umbrella and that the delay and work needed to get back up to speed makes a remedy at this stage impracticable. Once again, I am against her on that. Mr Oldham produced what seemed to me a convincing case for the ability of the pieces to be picked up if that were possible, and floated the possibility (which I understand is only a possibility) that at the end of this academic term the course could be taken over by another institution.
43. Another point taken again by Miss McCafferty was that the court should stay out of this, not just because we are concerned with an academic judgment but because the relationship between these two parties should be governed entirely by the agreement that was made in September 2003 because there is not sufficient public function displayed to warrant a public law remedy and relied heavily on the fact that there is no "statutory underpinning" (as she put it) of this relationship between the university and its contractor. Once again I am against her on that point. It is perfectly clear from the papers in the case that higher education generally is a public function statutorily controlled and that LMU is a provider of higher education (some 87 per cent on one estimate of which is provided by public funds). Leaving aside the public function undoubtedly and admittedly performed by QAA, which is to an extent peripheral to this argument, in a proper case the relationship between a university and its provider should be the subject of supervision and control if necessary by a court.
44. Finally, a point was raised on delay, firstly in respect of these proceedings, in that it was said that the claimant could have acted more quickly and even in time should a remedy have been granted to start the first year students off on their course; and, secondly, because of the situation induced by the delay in that we are now in November and half way through a term. Again, I reject both those submissions. Although both sides could have possibly acted faster during the summer vacation, I do not find that there is any culpable delay. The claimant was entitled to pursue the avenue of trying to settle this matter without recourse to law, as they did. In any event some of the delay at least was due to letters not being answered immediately.
45. For all those reasons I allow permission but refuse the remedies.

MISS McCAFFERTY: My Lord, I am conscious of the hour, but as it has been completed in the day we would ask for our costs and we would ask for summary assessment today. You should have our schedule of costs.

MR JUSTICE CALVERT-SMITH: Can you point me to it?

MISS McCAFFERTY: My Lord, it is not in the bundle.

MR JUSTICE CALVERT-SMITH: It is not?

MISS McCAFFERTY: No, my Lord. It looks like this. I am not sure when it came in to the court, but I have a spare copy if it will assist.

MR JUSTICE CALVERT-SMITH: It may be in my bundle somewhere. It may have been inserted, but I have not found it. (Same handed) No, I have not seen this. Have you had an opportunity of seeing this, Mr Oldham?

MR OLDHAM: Yes, I have had a quick look. My solicitor has also looked to a certain extent.

MR JUSTICE CALVERT-SMITH: What do you say?

MR OLDHAM: What I say is that the amount for the acknowledgement of service is vast. Frankly, and with the greatest of respect, I suggest that that is a surprising figure.

MR JUSTICE CALVERT-SMITH: What are you going to ask me to do, to conduct an exercise now?

MR OLDHAM: No, my Lord. I think it is unrealistic, bearing in mind the time.

MR JUSTICE CALVERT-SMITH: I think it probably is.

MR OLDHAM: It should be assessed if not agreed -- if there is to be a costs order.

MR JUSTICE CALVERT-SMITH: Do you want to address me on the principle?

MR OLDHAM: Yes, please. My Lord, for the following reasons, and perhaps unusually, I would suggest that this is not a case where costs should be awarded. First of all, my Lord, your Lordship has recognised that both parties are entitled to be frustrated and angry.

MR JUSTICE CALVERT-SMITH: Yes.

MR OLDHAM: So to a certain extent your Lordship can perhaps understand why we have done what we have done.

MR JUSTICE CALVERT-SMITH: Yes, which is why I gave leave. I quite see why.

MR OLDHAM: Secondly, my Lord, your Lordship will also be aware that, being a charity, two things follow: we do not have a great deal of money; and secondly, and perhaps more significantly, we did this not for our own commercial purposes but for the public good and I would suggest that this is not really a case where the award of costs serves a greater public purpose at all, particularly with regard to the discrepancy in the university's means and our means. I do not, of course, suggest that the university has got money to throw around, but it is certainly a matter your Lordship should take into account.

MR JUSTICE CALVERT-SMITH: Should I have in mind -- and I need the help of you both on this -- the existence of other litigation apparently current between the parties or not?

MR OLDHAM: I am not sure that you should. At the moment that litigation has been started and one option would be for us to agree directions if the matter were to go further. Since your Lordship has dealt with this as a discrete matter -- is your Lordship thinking perhaps of reserving costs?

MR JUSTICE CALVERT-SMITH: Well, that is one possible solution.

MR OLDHAM: My Lord, thinking about it further, and having discussed it with my instructing solicitor, I think possibly the suggestion of reserving costs is one that has a lot of merit in that it may well be that this is not the end of the road. It may well be that the overall justice of this situation can only be determined at a later date.

MR JUSTICE CALVERT-SMITH: That is what I am thinking. If you were to lose here but to win on breach of contract, the judge --

MR OLDHAM: The judge may say, "These were all issues that had to be dealt with and had to be brought up --"

MR JUSTICE CALVERT-SMITH: Yes. On the other hand, it could be said that you have lost here and that is too bad, you have to pay.

MR OLDHAM: My Lord, for those reasons we support the suggestion that costs should be reserved.

MR JUSTICE CALVERT-SMITH: Yes. Miss McCafferty?

MISS McCAFFERTY: My Lord, I strongly resist the suggestion that costs be reserved. There may never be a breach of contract case.

MR JUSTICE CALVERT-SMITH: Quite.

MISS McCAFFERTY: So far we have a few sentences tagged on to the end of --

MR JUSTICE CALVERT-SMITH: That would enable you to come back -- supposing that they were reserved, that would enable you to come back, would it not?

MISS McCAFFERTY: My Lord, yes, but that would be contrary to the overriding objective that at some weeks or months in the future -- indeed, the limitation period would expire. It is six years from the date -- so some time in the future; it could be years later that we would have to come back.

MR JUSTICE CALVERT-SMITH: Yes.

MISS McCAFFERTY: And they are completely different issues, the public law claim and the private law claim. We should have our costs. They should follow the event. We have been successful in the judicial review claim. So the costs should be decided today. It is in no one's interests to have to return to deal with costs of the judicial review claim weeks, months, years in the future. How can a QBD Judge -- or which ever division this is brought in front of -- possibly decide the costs of this judicial review? How can he or she possibly decide whether costs should not follow the event or whether there was any other exceptional circumstance or particular reason why we should not have had our costs of the judicial review. Your Lordship has heard the claim today. Your Lordship is best place to decide the costs. Costs should follow the event in the normal way.

MR JUSTICE CALVERT-SMITH: What about the three points?

MISS McCAFFERTY: My Lord, yes. First of all, both parties are frustrated and angry -- well, yes, that is no doubt true. That is not all the defendants' fault. I understand that the QAA have an application for their costs. I do not understand myself or my learned friend to make an application for costs against them, but the frustration and anger -- there is no sense in apportioning blame to anyone at this stage -- but frustration and anger do not give rise to costs. Costs follow the event.

In terms of the fact that the claimant is a charity, we are also a publicly funded university. They say they are doing this on behalf of the students. The students of course have got a claim in their own right and given their status they may well have got public funding for that. The claimant could have applied for a protected costs order if they thought that the circumstances justified that. They have done none of that. They have brought this claim on a commercial basis; they have instructed commercial solicitors, they have instructed commercial counsel. They found the money to pay their own costs, and there is no reason of impecuniosity or a charitable status why they should not pay our costs. As my learned friend says, not only do we not have money to throw around, but we are, in fact, as are the whole higher education institutions, a cash-strapped university. We did not start this claim. We have had to spend a lot of money --

MR JUSTICE CALVERT-SMITH: I will tell you what is at the back of my mind. You conceded that it would have been good customer relations to have divulged the extent of the problem before 24 August.

MISS McCAFFERTY: My Lord, I conceded that it may have made for better relations.

MR JUSTICE CALVERT-SMITH: I would go a bit further than that. It might have led to these proceedings not being brought possibly. I cannot say that it would or it would not. The students would still have been just as angry, of course they would.

MISS McCAFFERTY: My Lord, yes. My Lord, we were brought into this claim. We have successfully defended this claim and we should have our costs.

MR JUSTICE CALVERT-SMITH: Yes.

MR OLDHAM: My Lord, sorry to trouble you further, but before we get on to the question of whether it would be sensible to reserve costs, there was one other point.

MR JUSTICE CALVERT-SMITH: Yes, I am so sorry, I cut you off.

MR OLDHAM: My Lord, the point you made to my learned friend that we were kept in the dark -- we feel we were kept in the dark. There were certain documents which outlined difficulties which the university was aware of which were not outlined to us and the feeling certainly from those behind me -- at least some of my lay clients -- is that had those been shown to us at the time we may well not have been here today. I will tell you which documents they are in particular concerned about. They are the ones at page 168 and 209-210. It is more than customer relations, my Lord. As has been suggested by my learned friend, these are very significant issues which, had they been raised, it might have been different.

My Lord, briefly, on the objections to the question of reserving costs, two points. My learned friend paints a disastrous scenario of having to wait six years. She has liberty to apply at any stage. It seems to me that she does not have to wait until limitation period ends. Secondly, it is not right to say in an overriding objective sense that the issues are different. They are the same -- or at least very similar issues seen in different lights.

MR JUSTICE CALVERT-SMITH: If the case were to go to trial in contact, an awful lot of what has passed between us today would be rehearsed in a different context obviously --

MR OLDHAM: A lot would be relevant, yes.

MR JUSTICE CALVERT-SMITH: -- to the breach and the extent of the breach.

MR OLDHAM: My Lord, that is right and the overall justice of the situation will be more apparent at that stage.

My Lord, I have just been handed a note. It is not a matter that is in evidence, but I would feel very bad if I had not read it out to your Lordship. "If damaging costs are awarded then the charity will go bust and no students will be able to continue to year 2." My Lord, there is no evidence of that, I accept, but I felt I had to read it out.

MR JUSTICE CALVERT-SMITH: Yes. I am well aware of the thin ice that charities skate on, and sometimes something hits them mid-ships and they do go under. It has happened many times. It is a strong point. On the other hand, as Miss McCafferty says, we are talking about public funds on both sides.

MISS McCAFFERTY: My Lord, no doubt the charity were advised before commencing this litigation as to how much it would cost and that if they lost they would be likely to have to pay the costs of the other side. They have embarked on this litigation on commercial terms. There are measures which the court can take to stop an impecunious party from acting in a way which is not in the public interest. None of those steps were taken. They are here before you with commercial solicitors and counsel. No expense appears to have been spared in the preparation of this case, and it is not the correct approach for your Lordship to say that suddenly they are now to be viewed as an impecunious charity against a London University. That is not the reality of the situation.

The final point is that if my learned friend says that the litigation would not have proceeded had they seen the e-mail --

MR JUSTICE CALVERT-SMITH: May not have.

MISS McCAFFERTY: May not have -- well, of course this was all disclosed with Dr Aylett's witness statement of 13 October, and here we are one month later. He simply cannot make good that argument because they have in fact proceeded with this litigation with all guns blazing. There is no basis for a departure from the usual order that we should have our costs.

MR SYKES: My Lord, it was indicated that you would be hearing from me on the issue of costs, too. My solicitors have indeed served a costs schedule.

MR JUSTICE CALVERT-SMITH: I have not seen it.

MR SYKES: My Lord, I do have other copies that I can hand around. I can say that this was faxed to various offices. My Lord did indicate that the parties may have a feeling of frustration and anger. Well, my Lord, the QAA is carrying out its public function properly. It is not the fact that the review itself came as a bolt from the blue. Indeed, the outcome of the review similarly indicated, the QAA would say, that during the course of the process there has been some discussion in dealing with the e-mail of 9 June 2005 which trails indeed what the likely outcome will be.

As regards QAA's involvement here, it was served an interested party, which clearly the claimant had in mind QAA's involvement and it is perfectly correct to say that the initial reaction of the QAA was, "Well, this perhaps does not really concern us". However, once the further evidence was seen, it was perfectly apparent that there were issues with which the QAA ought properly to turn up to assist the court. My Lord, it is for that reason and that reason alone, having seen the evidence of the parties, QAA served a witness statement and instructed us to attend here today.

My Lord, the costs of the QAA have been kept to a minimum by comparison to those of other two parties concerned and indeed, my Lord, I would invite you to make provision for them so that the QAA do not have to turn up again in subsequent proceedings that may occur in order to seek the costs of, in my submission, its perfectly proper involvement in this claim.

My Lord, essentially you have a decision to make in connection with costs. They are sought against the loser (if I can put it that way). It is not a case where the QAA ought to sit and bear its own costs.

MR JUSTICE CALVERT-SMITH: Mr Oldham, something else for you to address.

MR OLDHAM: I really am surprised by this. I should have brought the Bolton case along. Your Lordship knows that two sets of costs are very rare. This certainly is not that case. QAA was joined as a matter of courtesy since it was involved in the story. In no sense have we sought to criticise the QAA whatsoever. Its presence here in terms of its statement added nothing. Its submissions have been non-existent --

MR JUSTICE CALVERT-SMITH: I think you have said enough. There will be no order in respect of the QAA.

MR OLDHAM: I am most grateful.

MR JUSTICE CALVERT-SMITH: So far as the principal application is concerned, I have not found this entirely easy. I think the best I can do for the defendants is to reserve the costs, with liberty, should the other matter settle or disappear in some other way, for Miss McCafferty to return. But I have to say that that is the best she would have got out of me today on the three bases that Mr Oldham suggested.

MR OLDHAM: My Lord, I am grateful. My Lord, there is one other application and that is for permission to appeal and that is, my Lord, on these grounds. I am most grateful -- I am sure we all are -- to your Lordship for dealing with the entire gambit of the issues, but we suggest, respectfully, that your Lordship has made, or at least has arguably made, an error of law in these respects, that is to say as regards the duty to consult -- it may have been my fault, bur we certainly were arguing that there was a full duty of consultation, and it seemed to me that the passage in your Lordship's judgment suggested -- your Lordship said that there was no legal duty to consult. We say that there was. With respect, we suggest that your Lordship has not reasoned your Lordship's judgment correctly as regards the scope of need to consult; nor, with respect, has your Lordship analysed why there was no legitimate expectation in all the circumstances.

My Lord, given that your Lordship did say that had we been successful there was a real prospect of relief -- your Lordship was not minded to accede to my learned friend's argument on that ground, this appeal serves a genuine purpose and we would seek permission?

MR JUSTICE CALVERT-SMITH: No, I will not grant permission. You will have to go elsewhere for that.

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