QUEEN'S BENCH DIVISION
Strand, London, WC2A 2LL
B e f o r e :
| JOHN TAYLOR
|- and -
|HONITON TOWN COUNCIL
EAST DEVON DISTRICT COUNCIL
Jonathan Wragg (instructed by Foot Anstey LLP) for the Defendant
Jeremy Phillips (instructed by Henry Gordon Lennox, Strategic Lead (Legal and Licensing and Democratic Services) and Monitoring Officer) for the Interested Party
Hearing date: 9th November 2016
Crown Copyright ©
Mr. Justice Edis :
(1) A relevant authority must promote and maintain high standards of conduct by members and co-opted members of the authority.
"I am a Town Councillor for Honiton St Michael's Ward. A meeting of the Council was held last night 26 January 2015 most of which was held in 'private'. I am publishing one event that asked me to conspire to break the law and I hope that I am allowed in law to issue this leaflet under the defence of Public Interest. I may be accused of breaking the rules of the Council and stopped from attending? I might even be arrested and prosecuted but if that happens you will know that I am being punished for telling of an offence, a conspiracy to use money from the Public Works Loan Board (PWLB) for an improper purpose. The Town Clerk of Honiton stated that she has applied a loan of £98000 (value published) to cover 'poaching' of monies from the accounts (quote from published internal audit); in fact needed to replace 'poached reserves' used to pay £75000 worth of bills that should have been disputed. This intent etc is already in the public domain. However the Town Clerk stated that she would not need all of the money. That statement would be covered by the 'Part B privacy rules'. She stated that she intended to put the surplus into a high interest account and to use that as a reserve to pay down the loan. That also is covered by the Part B privacy rules. However, to apply for money knowing that there it is not needed for a purpose allowed under the PWLB rules is illegal because it is a way of replacing reserves that are required to be kept by all Councils but in the case of Honiton Town have been 'poached'. The Mayor suggested we use the fancy word 'virement'. I will not stay silent on this. There were other things in the meeting that were scams on the ratepayers of Honiton but I have yet to find out my rights of disclosure within section 100a of the Local Govt Act publish because of 'privacy' rules. I can say that six Counsellors have signed a request for a motion that asks for the finances of the Town Council and the Beehive to be investigated by the Devon and Cornwall Constabulary. The Mayor and the Town Clerk got the request yesterday.
"I think the loan must be approved by EDDC and must be consistent with the rules of PWLB. Will EDDC let the application go through? What is stated on the application as justification? – I have not seen it. The PWLB pays out from loans raised by the Government, i.e. 'the public borrowing requirement' of which all political parties are shouting should be controlled and lots of people's incomes are under pressure because of this. Not Honiton Town Council (Beehive).
"Issued by John Taylor Town Councillor for St Michaels. You may see me in handcuffs? Or gagged? I doubt I can be sued for whistleblowing on this."
4(a) You must treat others with courtesy and respect
4(f) You must not disclose information given to you in confidence by anyone, or information acquired by you which you believe, or ought reasonably to aware, is of a confidential nature [subject to exceptions]."
The Investigation Report
"5.6 I am quite clear, however, that establishing the validity or otherwise of the additional building costs which made the loan necessary, is outside of my remit. This is a matter for the Town Council and the contractor to pursue. Any disputed costs should be resolved by negotiation or through dispute resolution under the contract. The outcome of this process is not required in order to reach a finding on this complaint."
i) That Honiton had been advised by its Internal Auditor to extend the PWLB borrowing.
ii) That the Town Clerk had obtained the relevant guidance and taken advice from the PWLB and the County Secretary for the Devon Association of Local Councils.
iii) That the process for applying for the loan was in line with the provisions of the Local Government Act 2003 and followed relevant guidance.
iv) The key decisions regarding the application for the loan and the amount of funding were taken by Honiton and not the Town Clerk who implemented the decisions in accordance with the resolutions of Honiton.
v) There was therefore no evidence to suggest that the loan application was in any way illegal, and was used for an improper purpose.
vi) The statement did not disclose confidential information because it contained information which was properly in the public domain and the claimant's own contentions about it. No specific confidential information was revealed.
The October Sanctions Policy
i) A member will be unable to speak at any meeting including the Council Meeting. They would retain their right to vote.
ii) A member will be removed as a member of any committee or working group.
iii) A member attending any meeting as a member of the public will not be able to speak.
iv) A member "can also be prevented" from coming into the council office unless accompanied by arrangement. They can be required to make an appointment so that staff are not left alone with them.
"The Deputy Town Clerk advised that both Officers of the Town Council are of the view that local government legislation only permits a local council to act where it has a specific power to do so and that no power exists to remove a Councillor's right to speak at a Council meeting. The advice from the County Secretary of the Devon Association of Local Council's was read out. The advice supported the view of the Town Council's Officers."
The November meeting of East Devon
"In conclusion the findings of the Sub-Committee were that Councillor Taylor had issued a statement, written as a Honiton Town Councillor, which was sent by a recipient to the media. The statement made a number of claims about the legality and propriety of a loan obtained by the Town Council. In the statement, Councillor Taylor referred to the Town Clerk three times, which after deliberation the Sub-Committee concluded that this implied a direct criticism of the clerk's integrity in dealing with the finances of the Beehive."
i) That Honiton Town Council censure Councillor John Taylor for his breach of the Code of Conduct;
ii) That Honiton Town Council publish the findings of the Hearing Sub-Committee. (EDDC will anyway publish the findings on its own website as a matter of procedure).
iii) That Honiton Town Council instruct EDDC's Monitoring Officer to arrange training for Councillor Taylor in respect of the Code of Conduct and Councillor conduct – such training by the end of the current financial year ("the training requirement").
The decision of Honiton
i) A restriction preventing the claimant from speaking at any meeting including the Council meeting.
ii) The removal of the claimant from the 5 committees and working groups on which he served.
iii) A restriction preventing the claimant from attending any meeting as a member of the public together with a restriction from speaking as a member of the public at any meeting.
iv) A restriction preventing the claimant from attending at the Council offices unless accompanied by the Mayor of the Council.
i) Illegality for these reasonsa) The Council has no power to make the Decision;b) The Decision was based on a rigid application of policy;c) The Decision was imposed for an improper purpose;d) The Decision is inadequately reasoned;e) The Decision is perverse.
ii) The Sanctions were not imposed on a proper basis in the light of East Devon's conclusions on the investigation.
iii) The hearing before the standards sub-committee was procedurally unfair.
"In light of the fact that your client seeks to challenge the decision of the District Council dated 30th November 2015 we hereby withdraw all sanctions currently imposed on your client. The Council will, however, consider the issue of sanctions again after (i) any fresh decision made by the District Council and/or (ii) the outcome of any judicial review proceedings against the District Council."
i) The Town Council agrees that the decision dated the 14th December 2015 should be treated as never having been made.
ii) The Town Council agrees that it will not seek to re-impose all of the sanctions that were imposed on the 14th December 2015. However, the Town Council will consider in due course what actions it might wish to take in light of the decision of East Devon District Council - which decision has not been challenged by your client. It is likely that any such decision of the Town Council may well involve the imposition of some of the sanctions (but not the additional sanctions/measures) previously imposed on your client on the 18th December. Any such decision will take into account (i) the issues raised by your client in his claim against the Town Council (ii) the Town Council's response to your third question below and (iii) further legal advice taken by the Town Council;
iii) The Town Council is aware that your client seeks a measure of comfort. However, the Town Council has found it difficult to determine what is meant by your third question. The vagueness of the terms you have used makes a meaningful response impossible. The Town Council is content to confine any future sanctions/measures to those set out in the case law you have referred to. Consequently, your reference to "sanctions and/or measures intended to ensure sanctions are adhered to" will not arise.
iv) The Council will pay your client's costs on the standard basis to be assessed if not agreed.
i) The claimant, through Mr. Beglan, said that he sought a quashing order in relation to the Decision, which it was accepted he should have. He sought a declaration as to the October policy and a "steer" in relation to any determination Honiton may make as to sanctions. Can Honiton rely on the November decision of East Devon including on disputed matters of fact, and given the terms of s.28(11) of the Localism Act what are the respective roles of Honiton and East Devon in dealing with allegations of breaches of the Code of Conduct.
ii) Mr. Wragg on behalf of Honiton said that his clients accept everything which is said under Ground 1 and that it had tried to concede everything and get out of these proceedings, but it was unable to accept the claimant's contention that East Devon merely makes recommendations as to whether a breach should be found and that Honiton must make up its own mind on that issue. He said that such an approach would render the task of Parish Councils impossible because they often have no professionally qualified officers and the point of the 2011 Act is to remove decisions on breach from them for that reason.
iii) Mr. Phillips on behalf of East Devon said that his clients were not the subject of any challenge, but that rulings on two questions may be helpful to them and other local authorities. These werea) What is the status of a decision of an authority exercising its function as principal authority under s.28 of the Localism Act 2011? Is the Parish Council bound to accept its findings of fact and on the issue of breach of the Code. On that issue East Devon's position is the same as Honiton.b) Is there a power to require a Councillor to undergo training as to the Code of Conduct as a sanction consequent upon a finding of breach? On this issue East Devon and Honiton take different positions.
i) I will decide whether Honiton was bound by the findings of East Devon as to the facts and as to whether there was a breach of the Code. This is because the Decision actually involves two stages: breach and sanction. Honiton has certainly withdrawn the second, but says that it is still bound by the first. The point is not academic to the Decision and to the order which should be made. Whatever the outcome of this issue, I will quash the Decision. This does not mean that the route to that result is irrelevant. If the claimant is right I will quash the finding that there was a breach of the Code because no such finding was made by Honiton which wrongly simply adopted East Devon's decision. If Honiton and East Devon are right I will quash the Decision because Honiton has conceded that it wrongly included sanctions which are beyond its powers.
ii) I will also consider whether there is a power to impose a training requirement. This is not entirely academic because the application of unlawful sanctions is one basis of the quashing order and the extent to which the sanctions were unlawful is therefore involved in the decision.
The statutory scheme under the 2011 Act
"27. Duty to promote and maintain high standards of conduct
(1) A relevant authority must promote and maintain high standards of conduct by members and co-opted members of the authority.
(2) In discharging its duty under subsection (1), a relevant authority must, in particular, adopt a code dealing with the conduct that is expected of members and co-opted members of the authority when they are acting in that capacity.
(3) A relevant authority that is a parish council—
(a) may comply with subsection (2) by adopting the code adopted under that subsection by its principal authority, where relevant on the basis that references in that code to its principal authority's register are to its register, and
(b) may for that purpose assume that its principal authority has complied with section 28(1) and (2).
(6) In this Chapter "relevant authority" means—
(a) a county council in England,
(b) a district council,
(c) a London borough council,
(d) a parish council [Honiton is a parish council for this purpose].
28. Codes of conduct
(1) A relevant authority must secure that a code adopted by it under section 27(2) (a "code of conduct") is, when viewed as a whole, consistent with the following principles—
(2) A relevant authority must secure that its code of conduct includes the provision the authority considers appropriate in respect of the registration in its register, and disclosure, of—
(a) pecuniary interests, and
(b) interests other than pecuniary interests.
(3) Sections 29 to 34 do not limit what may be included in a relevant authority's code of conduct, but nothing in a relevant authority's code of conduct prejudices the operation of those sections.
(4) A failure to comply with a relevant authority's code of conduct is not to be dealt with otherwise than in accordance with arrangements made under subsection (6); in particular, a decision is not invalidated just because something that occurred in the process of making the decision involved a failure to comply with the code.
(6) A relevant authority other than a parish council must have in place—
(a) arrangements under which allegations can be investigated, and
(b) arrangements under which decisions on allegations can be made.
(7) Arrangements put in place under subsection (6)(b) by a relevant authority must include provision for the appointment by the authority of at least one independent person—
(a) whose views are to be sought, and taken into account, by the authority before it makes its decision on an allegation that it has decided to investigate, and
(b) whose views may be sought—
(i) by the authority in relation to an allegation in circumstances not within paragraph (a),
(ii) by a member, or co-opted member, of the authority if that person's behaviour is the subject of an allegation, and
(iii) by a member, or co-opted member, of a parish council if that person's behaviour is the subject of an allegation and the authority is the parish council's principal authority.
(8) [This sub-section provides detailed apparatus for the selection of independent persons for the purposes of subsection (7). It is unnecessary to set the terms of the provision out in full, but it is to be inferred from them that Parliament considered that the role of the independent person was of real importance].
(9) In subsections (6) and (7) "allegation", in relation to a relevant authority, means a written allegation—
(a) that a member or co-opted member of the authority has failed to comply with the authority's code of conduct, or
(b) that a member or co-opted member of a parish council for which the authority is the principal authority has failed to comply with the parish council's code of conduct.
(11) If a relevant authority finds that a member or co-opted member of the authority has failed to comply with its code of conduct (whether or not the finding is made following an investigation under arrangements put in place under subsection (6)) it may have regard to the failure in deciding—
(a) whether to take action in relation to the member or co-opted member, and
(b) what action to take.
Discussion and decisions
Issue 1: the status of East Devon's decision
Issue 2: the training requirement
"The legal framework in England
25 Until 2012, Wales and England shared the scheme as set out above, the role of the Ombudsman in Wales being performed in England by, first, the Standards Board and, later, ethical standards officers of Standards for England.
26 However, for England, that regime was abolished by the Localism Act 2011 from 1 April 2012. This abolished the model code of conduct for local authorities in England, in favour of a new regime that requires local authorities to formulate and adopt a code of conduct locally which must be based on seven identified principles: sections 26 and 27(1)(2) . The requirement for local authorities in England to have standards committees was also abolished, in favour of "independent persons" who have a consultative role as part of their local standards arrangement: section 28(7).
27 Ethical standards officers in England (the equivalent of the Ombudsman in Wales) were abolished, and their functions were not retained. Instead, from 1 July 2012, section 34(1) makes it a summary criminal offence deliberately to withhold or misrepresent a disclosable pecuniary interest which, on conviction, may attract a maximum fine of £5,000 and an order disqualifying the person from being a member of the relevant authority for up to five years. Thus, in England, a councillor cannot be disqualified unless he is (i) in the paid employment of the authority (section 80(1)(a) of the 1972 Act: see para 12 above); (ii) convicted of any offence and sentenced to imprisonment for at least three months (section 80(1)(b) of the 1972 Act: again, see para 12 above); or (iii) convicted of an offence under section 34(1) of the 2011 Act and thereafter made the subject of a disqualification order by the magistrates. The power of local authorities to suspend members was also revoked from 7 June 2012.
28 It was uncontentious before me that, there being no common law right for an authority to impose sanctions that interfere with local democracy, on the abolition of these sanctions and outside the categories I have described above, a councillor in England can no longer be disqualified or suspended, sanctions being limited to (for example) a formal finding that he has breached the code, formal censure, press or other appropriate publicity, and removal by the authority from executive and committee roles (and then subject to statutory and constitutional requirements).
29 The rationale for this change was set out in a number of statements issued by the Department for Communities and Local Government. There appear to have been two themes. First, the United Kingdom Government considered that the earlier regime, consisting of a centrally prescribed model code of conduct, standards committees with the power to suspend a local authority member and regulated by a central quango, was inconsistent with the principles of localism. There was, in addition, concern that the regime was a vehicle for vexatious or politically motivated complaints which discouraged freedom of speech and which could be used to silence or discourage councillors from (eg) whistle-blowing on misconduct.
30 The Welsh Ministers have not adopted the same approach as England; and, for Wales, have maintained the pre- Localism Act scheme. In their written submissions as interveners in this appeal, they say (at paras 21–23): (1) The Localism Act 2011 has been largely rejected by the Welsh Ministers as being inappropriate to the social policy agenda in Wales. (2) The Welsh Ministers were confident that the Ombudsman, adopting a robust approach, could sift out any minor, vexatious and politically-motivated complaints made in Wales. (3) Thus, the Welsh Ministers were not persuaded that the ethical standards system in Wales was in need of reform. That was confirmed in the Welsh Government White Paper, Promoting Local Democracy (May 2012). (4) That remains their view. They refer to paras 16–19 of the Committee for Standards in Public Life annual report 2011–12, which expressed concerns about what the committee regarded as inadequate sanctions in the new English scheme, which were restricted in essence to "criminal law or … the ballot box". The Welsh Ministers remain of the view that the scheme in Wales complies with article 10 of the Convention."
"the question depends on an exacting analysis of the factual case advanced in defence of the measure, in order to determine (i) whether its objective is sufficiently important to justify the limitation of a fundamental right; (ii) whether it is rationally connected to the objective; (iii) whether a less intrusive measure could have been used; and (iv) whether, having regard to these matters and to the severity of the consequences, a fair balance has been struck between the rights of the individual and the interests of the community. These four requirements are logically separate, but in practice they inevitably overlap because the same facts are likely to be relevant to more than one of them."