Neutral Citation Number: [2014] EWHC 1336 (Admin) 
Case NoL CO/9851/2013 
IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION 
THE ADMINISTRATIVE COURT 
Manchester Civil Justice Centre 
1 Bridge Street West
Manchester
Greater Manchester
M60 9DJ

Date: Wednesday, 19th March 2014
 
B e f o r e: 

HIS HONOUR JUDGE STEPHEN DAVIES 
(Sitting as a Judge of the High Court)
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Between: 
	THE QUEEN ON THE APPLICATION OF ELIZA GBEH PETERS	Claimant	
	v
		
	SECRETARY OF STATE FOR THE HOME DEPARTMENT
	Defendant	
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Mr Rory O'Ryan (instructed by Paragon Law, Nottingham) appeared on behalf of the Claimant 
Mr Sam Karim (instructed by Treasury Solicitor’s Department, London) appeared on behalf of the Defendant 
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J U D G M E N T 

1.	HIS HONOUR JUDGE DAVIES:  This is a hearing to determine the claimant's challenge to the defendant's decision to grant her discretionary leave to remain instead of the indefinite leave to remain which she had sought.  His Honour Judge Bird granted permission on certain grounds which are no longer in issue, but refused permission on others, including those which are now before me.  The matter then came before His Honour Judge Raynor QC, who ordered that the renewed application should be heard on a rolled up basis, which is how it has come before me today.
2.	The three issues which have been argued before me are summarised in the claimant's skeleton argument produced by her counsel, Mr O'Ryan, and are as follows: did the defendant err in law:
(1)	by proceeding under a mistake of fact as to the nature of certain earlier periods of limited leave to remain granted to the claimant, such mistake of fact amounting to an error of law;
(ii)	by acting contrary to her common law duty to act fairly to the claimant;  
(iii) 	by relying on a 35‑day break in the continuity of the claimant's leave to remain, arising from a dispute as to whether or not a relevant fee had been paid by the claimant in one of her applications, such reliance being contrary to authority, on the grounds fairness, and inconsistent with other similar policies where the defendant would exercise her discretion to waive short delays but where here the defendant failed to consider exercising such a discretion.
3.	I can take those three issues in turn.  The first issue is the one that has been most forcefully argued by both sides.  There are two sub issues to be considered.  The first is whether or not, as a matter of fact and law, the defendant granted discretionary leave to remain or leave outside the rules in the periods in issue.  The second is on what basis, if any, should the court interfere with the defendant's decision – if such it was - that she only be granted leave outside the rules.
4.	It is convenient to begin by referring to the difference between discretionary leave to remain and leave outside the rules.  So far as that is concerned I have been provided with the relevant policy guidance in relation to both which was in existence at the material time.  So far as discretionary leave is concerned that is to be found in the Asylum Policy Instructions on Discretionary Leave (Version 3), issued on 27th October 2009.  It can be seen from the introductory section to that document that humanitarian protection and discretionary leave were introduced in April 2003 to replace exceptional leave, and that the way in which case workers are directed to approach this issue is that the case worker should begin, in a refugee, case by deciding whether or not the applicant qualifies for refugee status.  If not, next to consider whether he or she qualifies for leave on the basis of humanitarian protection and if not, finally to consider whether or not he or she qualifies for discretionary leave.
5.	It continues in relation to non asylum or refugee cases by saying that a standalone human rights claim (which is this case) may also result in a grant of discretionary leave if the qualifying criteria are met.  Then, importantly, it says that if they are not met, but the case worker is still considering granting leave outside the rules, he should refer to Chapter 1 section 14 of the Immigration Directorates Instructions (“IDIs”) in relation to leave outside the rules.
6.	There is then a helpful section headed "Key points".  From that, as relevant to this case, the following points emerge.  First, that discretionary leave is the grant of leave outside the Immigration Rules.  Second, that discretionary leave may be for any period up to 3 years.  In that regard, further on in the guidance, at page 117 of the bundle, there is a second section headed "Non standard grant periods", where it says there may be some cases, giving an example of someone qualifying under Article 8 ECHR, where the grant period may be a non‑standard period, the standard period being 3 years in Article 8 cases.  One of the particular circumstances identified in which that may be appropriate is a case where a grant of leave is appropriate to enable a person to stay in the UK to participate in a court case.  That is of particular relevance here because that, on the facts, was the position in this case.
7.	Third, in relation to the key points, it is noted that a person will not become eligible for settlement until they have completed 6 years' discretionary leave.  In that respect later on in the guidance, at page 122 of the bundle, more detail is provided about this.  In particular it is specified that such a person will not become eligible for consideration until they have completed 6 continuous years of discretionary leave, and that is the issue which arises in relation to the 35‑day point in this case to which I shall come in due course.  Finally, it is provided that those who are granted discretionary leave shall have access to public funds and are entitled to work.
8.	There is then a section headed "Criteria for granting discretionary leave.  Cases where return would breach Article 8 of the ECHR", which makes it clear that where the return of an individual would involve a breach of Article 8 ECHR then such a person should be granted discretionary leave.
9.	I turn next to the IDIs in relation to leave outside the rules.  First it is clear, as the name indicates, that this is also leave granted outside the Immigration Rules.  It is also a type of discretionary leave, introduced in 2003, when the old exceptional leave to enter or remain category was replaced.  Second, it is made clear, similarly to the policy guidance on discretionary leave, that it should only be considered and granted in circumstances where the applicant is considered not to fall for refugee status, humanitarian protection or discretionary leave.  Third, leave outside the Immigration Rules should only be considered to be necessary in two circumstances (i) certain specified immigration policy concessions, none of which are relevant here (ii) what are described as “particularly compelling circumstances”.
10.	In paragraph 6.1, there is a section entitled "wording for letters – grants” in which guidance is given as to how letters should be worded.  It is said that they should specify that the Secretary of State has agreed to exercise discretion to grant leave outside the provision of the Immigration Rules, in the particular circumstances of the case.  The letter therefore should state that the applicant has been given leave to remain in the UK outside the rules until a specified date subject to specified conditions.  Brief reasons explaining why the decision has been taken should also be given.  The letter should also state that there can be no expectation that any further application will be granted on this basis.
11.	As Mr O'Ryan submits, although there is no specific provision in this policy guidance as to the conditions which might be imposed, it is clear that as a matter of law those conditions could include conditions in relation to no access to public funds or no permission to work which are not, by the discretionary leave policy, applicable when discretionary leave is granted.
12.	In summary, it appears that both discretionary leave and leave outside the rules are very similar to each other in their basic nature and effect, in that they are both discretionary grants of leave outside the Immigration Rules, and that the only material differences appear to be twofold.  First, that in discretionary leave cases but not leave outside the rule cases, an applicant can acquire the right to be entitled to be considered for indefinite leave to remain on the basis of 6 years' continuous residence.  Second, that in discretionary leave cases, by policy concession, there is to be no condition restricting the ability to access public funds or to work.
13.	It is also necessary to consider the way in which a decision to grant discretionary leave or leave outside the rules should be communicated.  The current edition of Macdonald's Immigration Law and Practice, at paragraph 4.31 in the main volume at page 235, makes clear that there is no specified practice.  It says that sometimes there is only a letter, and other times a combination of a letter and a stamp in the applicant’s passport.  Stamps have, since February 2004, been replaced by UK residence permit stickers and, as we shall see, that is what happened in this case.  The text continues by referring to the case of Hashmi [2002] EWCA Civ 728,  in which the Court of Appeal decided that a letter written to an applicant's MP, in which it was decided, exceptionally, to grant indefinite leave to remain, amounted in itself to a decision which the Home Office could not reverse in the absence of fraud.  This was notwithstanding the absence of a stamp in the applicant’s passport, the Court of Appeal noting that a stamp in a passport does not in itself amount to a decision.
14.	Hashmi is of particular relevance to this case because it is clear that the basis on which the case was argued and decided was that the question was not what the defendant may, subjectively, have intended to grant, nor for that matter what the recipient might, subjectively, have believed was being granted, but was one based upon an objective analysis of the communications in question to see, as a matter of proper construction of those communications, in their factual and legal context, what grant of leave, if any, was being given.
15.	Turning then to the circumstances of this case, it is common ground that on 29th December 2006 the claimant was granted 3 years' discretionary leave on Article 8 grounds by reason of her being in the course of applying for access to her children in the course of court proceedings.  Unfortunately, no covering letter has been produced in relation to this grant.  However there is in evidence at page 102 of the bundle a copy of the residence permit which was issued at that time, which simply records that the claimant was granted limited leave to remain valid until 21st December 2009.
16.	There was then, it is common ground, an in‑time application for further leave to remain, made just before the expiry of that leave.  The letter enclosing the application is in the bundle, and it is clear from a reading of that letter that what was being applied for was further discretionary leave to remain on the basis that this was what had already been granted.  
17.	I then come to the documents which are at the heart of this case.  There is a further residence permit which was issued on 21st October 2010.  It again states that it is limited leave to remain, in that case valid until 31st January 2011, so a short period of leave, and it also states: "No recourse to public funds.  No work or engaging in business." A covering letter is available in this instance, at page 98 of the bundle.  It is dated 21st October 2010, it was sent to the claimant's solicitors, and it reads as follows:  
"Your client has been granted leave to remain outside the Immigration Rules on an exceptional basis.  Any further applications will be decided on the merits of the case and it should not be expected that any further leave to remain would automatically be granted.  Please note this period of leave to remain has been granted in order to allow the court proceeding that your client is party to to be concluded and relevant judgments to be handed down by the presiding judge."  
It is I think reasonably clear from the wording of that letter that it was intended to be written substantially in accordance with paragraph 6(1) of the Leave to Remain IDIs to which I have referred, but it is also clear that it does not state in terms that is a grant of leave to remain outside the rules, granted in accordance with that policy, and the reference to “an exceptional basis” is more obviously a reference to the pre‑2003 policy position rather than to the position which attained under the relevant policy guidance in 2010.  Moreover, there is no specific statement to the effect that, unlike the previous grant of leave, this was not a grant of discretionary leave to remain.
18.	On receipt of that letter the claimant's solicitors responded in November 2010, in which the restrictions on the residence permit were challenged, and a request was made for a more appropriate grant of leave to be given, failing which the right to make a claim for judicial review was made.
19.	The result of that challenge was the issue of a revised residence permit.  Again, unfortunately no covering letter has been produced.  The revised permit is in precisely the same terms as the original one, save that it withdrew the conditions to which I have referred, so that it was unconditional in the same terms as the one previously granted in 2006.
20.	I should say that attached to its detailed grounds the defendant had produced an internal note recording its internal reasons for granting that leave but, because the detailed grounds were served well outside the time permitted by Judge Raynor QC in his earlier order, and for other reasons, which I explained when giving judgment on the defendant’s application to rely on that document, I refused permission to the defendant to rely upon that internal note.  In any event since it is an internal note, not said to have been communicated to the claimant or her solicitors at the time, it is of little, if any, relevance to the issue which I have to decide which is, as per Hashmi, based on an objective analysis of the contemporaneous communications.
21.	There was then, on 27th January 2011, a further in‑time application for further leave to remain, made on the same basis as the previous one, and on 18th February 2011 a further residence permit was issued in the same terms as the ones which had previously been issued and in the second case as corrected. The covering letter, which is available and is at page 92 of the bundle, simply says this:  
"I am returning the enclosed passport endorsed with an extension of stay in the United Kingdom."  
Again no more detail as to the basis of the leave being granted.
22.	There was then, in November 2011, following a further application, a further residence permit issued and the covering letter, which is at page 88 of the bundle, is a letter upon which the defendant relies which reads as follows: 
"A decision has been taken that it will be appropriate, because of the particular circumstances of your client's case, to grant her leave to remain in the UK on a discretionary basis outside the Immigration Rules for a specified period."
23.	In the meantime, in July 2011, the claimant had made an application for further discretionary leave to remain, but on the 19th August 2011 it had been returned by the defendant as invalid on the basis that funds were not available in the claimant's account when the defendant attempted to take payment for the application.  On 20th September 2011 the claimant resubmitted the application for leave to remain, resulting in the grant to which I have just referred.  However the time frame is relevant because the defendant has taken the view that the 35‑day period between the 19th August 2011 and 20th September 2011 amounts to a break in continuity.
24.	I then come to the application with which this case is concerned with, which was an application made for the grant of indefinite leave to remain, on the basis of 6 years' continuous residence, which was refused in a decision letter made on 26th April 2013, when a further 3 years' discretionary leave to remain was given.  The failure to grant indefinite leave to remain was challenged but the defendant maintained her position in further correspondence in May 2013 on the basis that, first, the claimant had been granted leave to remain outside the rules and not discretionary leave which had been granted in 2010 and again in 2011, and, second, relying upon the 35‑day break in continuity.
25.	The claimant's case is, as I have said, that what the court has to consider is what leave the defendant actually communicated on an objective analysis, rather than what leave the defendant may have intended to grant.  The defendant's principal submission is that the wording of the initial letter of October 2010 should be read as a grant of leave outside the rules because of its being consistent, in general terms, with the wording provided for in the IDIs.  The defendant’s further submission is that the subsequent leave in 2011 specifically referred to leave being granted on a discretionary basis, whereas the earlier one did not.  
26.	To counter this the claimant's argument is that if one considers what the letter actually said, three points become clear.  First, the reference to "exceptional circumstances" does not clearly convey the grant of leave outside the rules as opposed to discretionary leave.  Second, the reasons given in the letter are only consistent with leave being granted under the policy described in relation to discretionary leave, because those reasons would not be apt for grant of leave outside the rules.  Third, the reference in subsequent correspondence to discretionary leave cannot be relevant to the interpretation of correspondence sent in October 2010.
27.	The claimant also submits that whatever the position may have been as at October 2010, the position was made clear beyond doubt, once the challenge had been made and the further residence permit issued, because by withdrawing the conditions, which would only have been apt in a leave outside the rules case, the claimant says the defendant was accepting that this was a grant of discretionary leave.
28.	In short, the claimant says a reasonably knowledgeable and well informed reader, looking at this chain of correspondence and looking at the basis of the claim and the reason given for the grant of leave, would clearly have concluded that this was a grant of discretionary leave because it could not have sensibly have been intended as anything else, and that the defendant did not, as she ought to have done had she wanted only to grant leave outside the rules, to have stated that this was what she was doing.
29.	In my judgment, the claimant's submissions are to be preferred.  It seems to me that on an objective analysis there can be no real doubt but that what was being granted was discretionary leave.  At the very least, whatever the defendant's intention may have been, that was how the correspondence would have read to the reasonably well informed and knowledgeable reader.  It is not open in my judgment to the defendant to say - even if there was evidence to support it, which there is not - that this was not what she intended to do.
30.	It is quite clear, for the reasons that I have given, that in the circumstances in which discretionary leave was requested, those circumstances not being disputed by the defendant, the only proper leave to have granted would have been discretionary leave, and if the defendant had wanted to grant something else it was incumbent upon her to make it clear what she was doing and why.
31.	So far as the second grant is concerned, in my judgment the answer follows naturally from my first conclusion, because it seems to me to be quite clear that what was being done was to renew the same leave, on the same basis as had previously been granted, and if that was, as I have held, clearly discretionary leave then so must the further grant.
32.	Even if that was wrong then, as Mr O'Ryan submits, given that there was no clear reference to which leave was being granted either way, if an application for discretionary leave was made on grounds which clearly justified discretionary leave and not leave outside the rules, then the only reasonable inference was that this was what was being granted, unless the contrary was made clear.  Here, the contrary was not made clear.  I do not think that the fact that the letter may have been consistent with the proposed wording for the grant of leave to remain outside the rules as indicated in the IDIs is sufficient to make the contrary clear even to a well-informed reader, let alone someone in the claimant’s position.  In those circumstances I find for the claimant, on the clear interpretation of the correspondence.
33.	That then brings me to consider the consequences of that finding.  As I have said, the way in which the case is put in the statement of grounds at paragraph 16 is that the defendant's decision to the contrary is a mistake of fact or a misrepresentation of the nature of the form of the leave actually granted.
34.	It is plain, in my judgment, that this is a case where there only can only be one right answer: either the claimant is right and it was discretionary leave, or the defendant is right and it was leave to remain outside the rules.  This is not a case where there is any room for doubt, or where there are any further relevant background factors, which the defendant, as the decision maker, could properly take into account in assessing what leave was granted.  In those circumstances, it seems to me that the defendant's decision was plainly wrong.  It was a mistake of fact and/or a mistake of law.  It was also a decision which, on any view, was legally irrational or Wednesbury unreasonable because the decision made, as I have said, was plainly contrary to the proper assessment of the correspondence to which I have referred.
35.	In those circumstances there is no question, in my judgment, of this being simply a decision on the facts which this court does not have jurisdiction to entertain.  Instead it is a case where the court is not only entitled but obliged to say that the decision is one which could not properly have been arrived at on a proper and rational assessment of the facts, and that the only proper decision could have been that discretionary leave had been granted in both cases.  It follows, I am satisfied, that the decision cannot stand and must be quashed.  It also follows, I am satisfied, that this court should declare that the claimant had been granted discretionary leave over the whole of the period covered by those grants.
36.	In those circumstances, issue 2 does not directly arise for determination.  That is the issue by which it is contended by the claimant that if the defendant was right, strictly speaking, in deciding that leave outside the rules was actually granted, it would be unfair for the defendant to rely upon that in the particular circumstances of this case, where, as I have said, a proper application of the policy could only have resulted in discretionary leave having been granted.
37.	That issue also raises the further issue as to whether or not that argument is in reality a challenge to the earlier decisions themselves, granting (on this analysis) leave to remain outside the rules rather than discretionary leave and which, if so, would be a challenge made well out of time and for which, therefore, there would be no basis for granting permission unless an extension of time was granted.
38.	If I had needed to decide this point I would have been satisfied that, even if the defendant's primary position was right, the way in which the decisions had been communicated was so unclear that it would have been unfair of the defendant not to have taken that into account in making the decision, and also that it would have been appropriate to allow those decisions to be challenged in these proceedings because, until this point arose, which it did not until May 2013,  the claimant was, perfectly reasonably, entirely unaware of the importance of those decisions, so that there was no need for her to challenge them.  But for the reasons I have given the point does not strictly arise and, therefore, I do not need finally to decide it.
39.	Issue 3 raises, as I have said, the question of the impact of the 35‑day break in continuity point.  The defendant's position as maintained both in the summary grounds accompanying the acknowledgement of service and in the detailed grounds has been that the claimant was not refused indefinite leave to remain solely on the 35-day break basis.  This point, as appears from paragraph 17 of the summary grounds, was relied upon as being just one of a number of reasons why the claimant was not entitled to indefinite leave.
40.	In the course of argument, Mr Karim made the defendant's position clear, which was that if, as I have done, I find against the defendant on issue 1, the defendant accepts that it will be necessary for her to take a fresh decision having regard to that decision.  In that respect the defendant also accepts that in such a situation, in circumstances where the reason for taking the view that there was a break related to the circumstances in which payment was applied for and seemingly not made, she would have to give fresh consideration as to whether or not she should properly exercise her discretion to rely upon that apparent gap, having regard to the circumstances in which the payment was applied for but not successfully taken, and having regard to the decision of the Upper Tribunal in the case of Basnet v Secretary of State for the Home Department [2012] UKUT 000113 (IAC), in which Blake J and Upper Tribunal Judge Macleman gave guidance as to the difficulties which could arise in this sort of case and as to the way in which the issues arising in such a case should be determined.
41.	Mr O'Ryan invited me to go further, and to hold that in circumstances where the defendant had failed to provide any evidence in relation to the circumstances of payment I should simply find that the decision was wrong and that the defendant was not entitled to take the 35‑day break into account.  I do not, with respect to him, think that I can do that.  It is not a point which was raised, and information or submissions exchanged about it, in the period leading up to the decision under challenge.  That is not surprising or the subject of criticism because of course at that point the 35‑day period was not the primary reason why the indefinite leave to remain application was not granted.
42.	There has been no exchange of evidence by either party in relation to the reasons why payment was not collected, and the Secretary of State has not had the opportunity, in those circumstances, to consider whether or not, and if so on what basis and with what result, to exercise her discretion on the question.  In those circumstances, it seems to me that other than to record that, as is common ground, she was obliged to exercise a discretion in deciding that question, I should not go further and I should leave that question for her to decide so that, if necessary, there would have to be a separate challenge to any decision in that regard.
43.	That concludes my judgment.