England and Wales High Court (Administrative Court) Decisions

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

		Royal Courts of Justice Strand, London, WC2A 2LL
		29/04/2015

The Honourable Mr Justice Cobb :

1. This judgment addresses two important issues which arise from the judgment delivered in relation to the substance of the Claim. For an understanding of the background, see R (on the application of The Governing Body of the Oratory School) v The Schools Adjudicator & others [2015] EWHC 1012 (Admin). I refer in this judgment to the Claimant as "the School" and the Defendant, "the Adjudicator".
2. Those two issues are:

i) Whether the issue of the School's 'regard' to the published Guidance from the Archdiocese of Westminster (the "Diocesan Guidance"), in the context of paragraph 1.38 of the Department for Education's School Admissions Code (2012) ("the Admissions Code"), should be remitted for re-consideration and determination by a newly appointed School's Adjudicator (I refer to this, by way of shorthand, as "the Diocesan Guidance issue");

ii) Costs, as between the School and the Adjudicator.

3. Having received written and oral submissions on those points on 17 April 2015, I gave my decision at the conclusion of the hearing, as follows:

i) The Diocesan Guidance issue should be remitted to a newly appointed Adjudicator for re-consideration and determination, with a direction that the Adjudicator reconsider the matter and reach a decision in accordance with my judgment ([2015] EWHC 1012 (Admin)), specifically having regard to paragraphs [58]-[61] (i.e. the proper approach to the phrase "have regard" in paragraph 1.38 of the Admissions Code);

ii) The Adjudicator shall pay 80% of the School's assessed costs, with a payment on account (by 8 May 2015) in the sum of £60,000.

Remittal of the issue to a new Adjudicator

4. Both under statute (see section 31(5) Senior Courts Act 1981) and under the Civil Procedure Rules 1998 (see CPR 54.19(1) and (2)) I am vested with a wide discretion when making a quashing order to remit the issue to the decision-maker, with a direction that the decision-maker "reconsider the matter and reach a decision in accordance with" my judgment.
5. The School opposes remittal of any of the six aspects of the Adjudicator's determination which I have quashed. Of those six aspects, the Adjudicator seeks remittal of only one, namely the Diocesan Guidance issue.
6. Mr Béar QC, on behalf of the School, in summary contends:

i) That while this Adjudicator had determined the Diocesan Guidance issue against the School, the previously appointed adjudicator (Mr Lennard Jones) had reached the opposite conclusion, favourable to the School. The outcome of the earlier investigation (in 2013) should be taken into account in directing no further consideration of the issue;

ii) That the Adjudicator has no statutory authority to investigate the issue now as the British Humanist Association's complaint (see [37-38] of the earlier judgment) has been disposed of by my substantive ruling;

iii) That it would be unreasonable to remit the issue now, having regard to the delay in resolving this particular complaint which has been investigated by the Office of the Schools Adjudicator unsuccessfully twice; in this respect, he relies on R v Chief Constable of the Merseyside Police ex parte Merrill [1989] 1 WLR 1077 at 1088B-F, and R(Haracoglou) v Department for Education & Skills [2002] ELR 177 at [32], to which I have had regard;

iv) That there is no need to remit the issue for further determination as the outcome of any further determination is inevitable; he contends that the School is able to demonstrate that it has had regard to the Diocesan Guidance and has clear and proper reason for departing from it; there is therefore only one decision reasonably open to the Adjudicator;

v) That I could/should adjourn this question for both parties to file further evidence on the question of whether this is an 'only one decision reasonably open' case.

7. Mr. Goudie QC urged me to remit the issue, exercising my general discretion referred to above. He submitted that this would be the 'natural' course to take, advocating that there would be a real advantage for the School, its candidates and parents in there being clarity on this issue. He contended that there were two situations in which it would not be appropriate to remit a quashed decision in these circumstances: (i) if the outcome would be inevitable (identifying a high hurdle on the claimant to demonstrate that this is so), and (ii) if it would cause significant prejudice to the claimant. He contended that this situation fell into neither category.
8. I outlined my reasons at the hearing for concluding that it would be right to remit the case for further determination. I set out my more detailed reasoning below.
9. First, I do not consider that it would be right to substitute my own decision; Parliament has entrusted decision-making on this issue to the School's Adjudicator; moreover, "any fresh decision would be on the material then available to him, which might not be the same as the material at the time when the original flawed decision was made" see R(C) v Chief Constable of Manchester [2011] EWCA Civ 175 at [16]. No party in fact asks me to do so.
10. Secondly, I am satisfied that the Adjudicator has a continuing power to investigate the issue, having regard to the provisions of section 88I(5) of the School Standards and Framework Act 1998 (viz: "(a) the adjudicator may consider the admission arrangements, and (b) if the adjudicator considers the arrangements under paragraph (a), the adjudicator must decide whether they conform with those requirements and, if not, in what respect they do not": see also [19] of [2015] EWHC 1012 (Admin)). That power endures until the issue has been finally resolved; it has not been so resolved.
11. Thirdly, I am far from sure that there is only one outcome to any fresh determination. While the School has indicated its clear wish to depart from the Diocesan Guidance in order to maintain and enhance its pan-London mission and particular Catholic ethos, and to preserve therefore its distinctive place within the dioceses in the delivery of state-funded Catholic education, it will be a matter for the Adjudicator to decide whether that represents a 'clear and proper reason' for departing from the Diocesan Guidance in all, some, or indeed any, respects. While the Diocesan Guidance offers a high degree of flexibility in relation to schools' admissions criteria, as I indicated in my earlier judgment (see [60](ii) [2015] EWHC 2012 (Admin)) a Governing Body may have more difficulty in demonstrating a clear and proper reason for departing from the Guidance if the proposed faith-based criteria are expressly forbidden by it.
12. I am not persuaded (contrary to Mr. Béar's submission at [6](i) above) that I should take any account of the conclusions of Mr Lennard Jones, the previous adjudicator, whose determination in other respects (it was agreed) was demonstrably flawed (see [39] of [2015] EWHC 1012 (Admin)). Moreover, when taken by Mr. Béar to the relevant section of that earlier determination, it was apparent that Mr Lennard Jones did not in fact apply what I regard to be the appropriate test when considering the phrase "have regard".
13. I have taken into account, in remitting this issue for determination that I am prolonging the investigation, which has already continued for far too long. I indicated at [67] of my earlier judgment that I considered that there would be a need for a further determination of this issue. Nothing I have heard in the course of argument has dissuaded me from this provisional view; indeed, on the contrary, the argument at this hearing has only served to confirm my view. For the avoidance of doubt, for the reasons spelled out at [11] above, I see no benefit in adjourning the question of remittal to another hearing in order to allow the parties to file further evidence. There is ample material before me on which to make this determination now.

Costs

14. The School contended that it should recover its costs of the litigation from the Adjudicator, which, on their account, amount to a little over £155,000. The Adjudicator argued that he should pay one-half only of the School's costs, to be assessed.
15. The parties made rival contentions about how I should deal with the costs issue. Mr. Goudie invited me to take an issues-based approach (per Summit Property v Pitmans [2001] EWCA Civ 2020 and Multiplex Construction v Cleveland [2008] EWHC 2280), whereas Mr Béar invited me to take a wider view, considering the litigation as a whole, and awarding the costs in favour of the party which has, in the main, succeeded; he relied, in making this submission, on the judgment of Gloster J (as she then was) in HLB Kidsons v Lloyds Underwriters [2008] 3 Costs LR 427 at paragraph [10]/[11]. The School claimed to be the successful party, and therefore entitled to all of its costs. Mr Goudie acknowledged that the School had succeeded to a "significant extent" but had also failed to a "significant extent".
16. I was shown some relevant CPR Part 36 correspondence; both parties relied upon it in support of their respective arguments. The Part 36 offer by the Adjudicator (3 February 2015) reads as follows:

"The Defendant wishes to settle part of the claim made by the Claimant. Subject to the Claimant's agreement, the Defendant will accept that the Adjudicator erred in law in that he conducted an ethnic/socio-economic analysis of the pupils in attendance at the London Oratory School and a comparison with other schools in order to test an assertion made by the School using publicly available data, but without disclosure to the Claimant of the material relied upon by him prior to issuing the determination. This prevented the Claimant from being given fair opportunity to comment on the material used. In the circumstances, the Defendant would agree to a declaration that it was contrary to law for the Adjudicator to have found that the Claimant's oversubscription criteria 'unfairly disadvantage families who are less well off, in contravention of paragraph 1.8 of the Code' (§63 of the Determination)."

I detected nothing in the 3 February 'offer' letter which indicated that the Adjudicator considered that his position on the issue of procedural irregularity was actually justified, although in later correspondence (10 March) it was said by his solicitor on his behalf (albeit in non-specific terms) that "an offer does not indicate that a party considers the claim indefensible".

17. The School's solicitor replied (10 February 2015) as follows:

"If a public body has concluded that a particular finding is not properly defensible, it should state so openly and deal with the consequences openly. We are nonplussed at an approach that appears to offer an open acceptance of illegality, but yet seeks to use that acceptance as a bargaining chip".

18. In later correspondence, the School indicated (24 February 2015) that it was "minded to accept the offer" of the declaration on this aspect, but proposed conditions of acceptance which were not acceptable to the Adjudicator. Agreement was accordingly not reached, and the issue was therefore, as my earlier judgment reveals, litigated. On this issue, I found against the Adjudicator: see my findings at [68]-[85] of [2015] EWHC 1012 (Admin). I return to this at [20](iii) below.
19. Having regard to all of the circumstances of this litigation, and the authorities cited (most helpfully HLB Kidsons v Lloyds Underwriters above), I applied the following general principles when determining the costs:

i) My discretion as to costs is a wide one. The aim always is to "make an order that reflects the overall justice of the case" (Travellers' Casualty v Sun Life [2006] EWHC 2885 (Comm) at paragraph 11 per Clarke J. (as he then was));

ii) The general rule remains that costs should follow the event, i.e. that "the unsuccessful party will be ordered to pay the costs of the successful party": CPR 44.2(2)(a);

iii) In deciding what order to make about costs, I shall have regard to "all the circumstances" including "whether a party has succeeded on part of its case, even if that party has not been wholly successful": CPR 44.2(4);

iv) The question of who is the successful party must be determined by reference to the litigation as a whole; see Kastor Navigation v Axa Global Risks [2004] 2 Lloyd's Rep 119, see paragraph 143, per Rix LJ.

v) The identification of 'success' "is a matter for the exercise of common sense": BCCI v Ali (No 4) 149 NLJ 1222, per Lightman J. Success, for the purposes of the CPR, is "not a technical term but a result in real life" (BCCI v Ali (No 4) (supra)). The matter must be looked at "in a realistic … and … commercially sensible way": Fulham Leisure Holdings v Nicholson Graham & Jones [2006] EWHC 2428 (Ch) at paragraph 3 per Mann J;

vi) In any litigation, especially complex litigation, any winning party is likely to fail on one or more issues in the case. As Simon Brown LJ said in Budgen v Andrew Gardner Partnership [2002] EWCA Civ 1125 at paragraph 35: "the court can properly have regard to the fact that in almost every case even the winner is likely to fail on some issues".

20. With specific reference to the facts of this case, I formed the following views:

i) That on three of the most significant issues, namely (a) departure from the Diocesan Guidance, (b) alleged Socio-economic Discrimination and (c) Consultation on admission criteria, the School had succeeded in demonstrating that the Adjudicator had reached conclusions which were unlawful;

ii) In relation to Socio-economic Discrimination ([20](i)(b) above), the Adjudicator's error was unsustainable in two substantial respects;

iii) With considerable justification, Mr Béar submitted that the Adjudicator was unreasonable to have contested the accusation of procedural unfairness (which had led in the Adjudicator's Determination to a finding of socio-economic discrimination) at trial, having conceded it in an unqualified way behind the curtain of 'without prejudice' correspondence under Part 36 (CPR 44.2(4)(c)), particularly given:

a) That the Adjudicator represents a public body, which has a responsibility to be open in accepting that it has acted unlawfully if it believes this to be the case (see [17] above);

b) That the Adjudicator had not, in the without prejudice correspondence, sought to argue that his position on this issue was in fact defensible.

See generally CPR 44.2(5)(b) and (c).

iv) The School had not succeeded on the significant issue of 'Catholic service' as an oversubscription criterion;

v) On some more minor issues (see [93-97], [98-101], [102-106] of [2015] EWHC 1012 (Admin)), the School had succeeded;

vi) Where on other more minor issues the School had failed, it had done so only on a strict application of public law principles (see [110], [114], and especially [117] where I concluded that the Adjudicator's "…critique of the 2015 form in this regard verges on the pedantic"). It is fair to say that the School had not taken an unreasonable stance in relation to these points.

21. Therefore, I concluded that the School was the largely successful party and would be entitled to recovery of the majority of its costs. In all the circumstances, it seemed to me that the "overall justice of the case" (Travellers' Casualty v Sun Life) led to the conclusion that the School should recover 80% of its costs, subject to a detailed assessment. If I had applied an 'issue-based' approach, the result would, it seems to me, have been broadly similar given that the significant issue on which it failed was the 'Catholic service' issue ([86]-[92] of [2015] EWHC 1012 (Admin)).
22. Given the likely discounting of the costs bill on assessment, I considered that it would be reasonable (under CPR 44.2(8)) to award a payment on account of costs in the sum of £60,000. That was my order.

Permission to appeal

23. At the conclusion of the hearing on 17 April 2015 (but, self-evidently, before I had delivered this judgment), Mr. Béar sought permission to appeal my decision to remit the Diocesan Guidance issue to a new Adjudicator.
24. In making this application for permission, Mr. Béar challenged my formulation of the correct test of whether the School had "had regard to" the Diocesan Guidance under paragraph 1.38 of the Admissions Code ([58-61] of [2015] EWHC 1012 (Admin)); he contended that the judgment is wrong, and that my proposed test is likely to lead to a further flawed Determination. He further sought an extension of time for filing the Notice of Appeal for 21 days following delivery of the new Determination, in order that he may see whether the newly appointed Adjudicator decides the issue for or against the School, applying my test.
25. The question of remittal is entirely within my discretion. In my substantive judgment, I carefully considered and discussed, by reference to the multiple authorities cited, how the Adjudicator should approach the School's consideration of (or "regard" to) the Diocesan Guidance, in compliance with paragraph 1.38 of the Admissions Code. I do not consider that the School has a real prospect of succeeding in demonstrating that I was wrong in this respect (see CPR 52.3(6)).
26. Permission to appeal was therefore refused. Time (21 days: CPR 52.4) for renewing that application before the Court of Appeal, if so advised, will run from the date of this hand-down judgment (29 April 2015).
27. That is my judgment.