QUEEN'S BENCH DIVISION
Strand, London, WC2A 2LL
B e f o r e :
|- and -
|Sandwell Metropolitan Borough Council
James Goudie QC and Ronnie Dennis (instructed by Maria Price of SMBC) for the Defendant
Hearing dates: 3rd – 4th May 2017
Crown Copyright ©
MR JUSTICE GREEN :
(ii) The parties
(iii) Overview of the facts
(iv) Overview of the Grounds
(v) The power of the Council to conduct formal and informal investigations of alleged wrongdoing by members under the LGA 1972 and the LA 2011
a) Ground 1 – Bias: The investigation is infected by actual or perceived bias.
b) Ground 2 – Investigation politically motivated: The investigation was politically motivated and thereby pursued for an improper purpose and/or was irrational.
c) Ground 3 – Investigation irrational: The continuation of the investigation in the light of the evidence of bias was irrational and/or Wednesbury unreasonable.
d) Ground 4 – Investigation ultra vires: There was no lawful power to investigate alleged misconduct pre-dating the coming into effect of the LA 2011 (1st July 2012).
e) Ground 5 – Section 151 LGA 1972: The Authority acted unlawfully under Section 151 and it is impermissible to rely upon the safe harbour provisions of the LA 2011.
f) Ground 6 – Investigation oppressive: The matters under investigation are stale and the continuation of the investigation is oppressive and unreasonable.
g) Ground 7 – Investigation process has been pre-determined and usurped: The investigatory proceedings are unlawful because the Investigating Officer appointed by the Monitoring Officer in her report made "findings" of breach by the Claimant and thereby she predetermined the outcome and usurped the adjudicatory function of the Standards Committee.
(vi) Publication of the solicitor's report, Opinion and Audit Committee Report
a) Ground 8 – Publication unlawful: Publication was a breach of the Data Protection Act 1998 ("DPA 1998") and/or Article 8 ECHR.
b) Ground 9 – Publication politically motivated: Publication was politically motivated and thereby for an improper purpose and/or irrational.
c) Ground 10 – Publication ultra vires: Publication was ultra vires the Council's powers and was not an act contemplated by the Council's formal arrangements in place for investigations under the LA 2011.
d) Ground 11 – Publication biased: The solicitors report was infected with bias and publication was accordingly irrational and/or unreasonable as was any other document (such as the Opinion) which referred to it.
(viii) Procedural observations
B. The Facts
(i) Sandwell MBC
(ii) The principal allegations against the Claimant
a) the involvement of the Claimant in the sale at a substantial undervalue of public toilets owned by the Council to a person personally connected to the Claimant;
b) the involvement by the Claimant in the purchase of land at Lodge Street / Stone Street by his son, Azeem Hafeez;
c) the involvement of the Claimant in the sale of plots of land at Coroner's Office and 215 High Street to his son, Azeem Hafeez;
d) the involvement of the Claimant in the allocation of council housing by Sandwell Homes to his daughter, Noreen Bi;
e) the use of improper influence by the Claimant in the appointment as employees, or discipline of, members of his family by the Council;
f) the use of improper influence by the Claimant in cancelling or reducing parking tickets issued to the Claimant's wife and son;
g) the involvement of the Claimant in the release of restrictive covenants by property services;
h) the involvement by the Claimant in the scrutiny and approval of proposed sales under a "15 day sale scheme";
i) the use of influence on the part of the Claimant to persuade the Council to propose the purchase of land on Clifford Road for social housing by the Claimant's son, Azeem Hafeez;
j) the failure by the Claimant to declare his association with developers who were proposed to the Council as potential property development partners for sites within the Borough.
(iii) The alleged misconduct by the Claimant in relation to the sale of assets (public toilets) at an undervalue to a person connected to the Claimant
(iv) The alleged misconduct by the Claimant in relation to the expunging of parking tickets issued to the Claimant's family
(v) Comments in the media
"Bog-gate!!!! … In a Skidder exclusive I am prepared to say that Quyam, who bought the bogs from Sandwell Labour, at a knockdown price IS related to Nigat Loreen. Who's she? She is the wife of Naveed Hussain, er, son of Mahboob Hussain. Whilst I believe Nigat and Naveed live at a different address in Oldbury. They are both registered on the electoral register at 51 McKean Road, home of, er, Labour Councillor, Mahboob Hussain."
(vi) The police investigation
(vii) The Audit Committee investigation and the instruction of external solicitors
(viii) The draft Wragge Report: The Maxwellisation process
(ix) The comments of Mark Greenburgh on the 22nd October 2015
"However, of greater concern is the allegation that Cllr Hussain made verbally to you and I in our meeting with him just before Christmas, that he feels Mr Greenburgh holds some antagonism towards him (i.e. Cllr Hussain) because of his race, religion or ethnicity – and that Cllr Hussain feels this may have influenced Mr Greenburgh's approach to the investigation.
The issue of alleged antagonism towards Cllr Hussain because of his race, religion or ethnicity was not specifically referred to in the recent letter from Cllr Hussain's legal advisor.
You will recall that, at our meeting with Mr Greenburgh on 22nd October 2015, he made a passing quip about the disabilities of Cllr Hussain's daughter and her children being due to inbreeding. While Mr Greenburgh did not explicitly relate this comment to race, religion or ethnicity, it was inappropriate, offensive and entirely unnecessary in the context of our discussion.
You made Mr Greenburgh aware of your concern about this comment at the time and I reiterated our concern when I subsequently met Mr Greenburgh on 19th November 2015.
Since our meeting with Cllr Hussain, I have given very serious consideration to his allegation and the weight that we should attach to Mr Greenburgh's comment to us at our meeting in October – and whether the two should be considered in relation to each other.
I have considered whether these are such that they should affect our confidence in the conduct of this investigation by Wragge & Co. Amongst a number of options I have considered whether the investigation should be halted and re-commenced with a different legal provider and another 'appropriate person' to lead a new investigation, because of concern about bias or prejudice.
As I said in our telephone conversation on 5th January, I have reached the conclusion that, on balance, there is insufficient evidence that the investigation has been compromised to warrant halting the entire process and re-starting a new investigation, as I feel that this would have a disproportionately significant negative impact in terms of the time delay, cost, distress to employees and councillors, and harm to the council's reputation with West Midlands Police and the public.
I have reached this conclusion because I have no evidence to prove that Cllr Hussain's race, religion or ethnicity has had an inappropriate influence on the conduct of Wragge's investigation but, at the same time, the issues that have been raised are such that neither can I offer you as much assurance as I would like that they have not.
Therefore, I think it is appropriate that we should take further steps to ensure our confidence and the confidence of others into the conduct of this investigation.
In our telephone conversation, we agreed that Wragge & Co. should complete the Maxwellisation process on which they are so well-advanced. …
Upon our receipt of this report, we agreed that we will instruct a QC to review the whole report and the evidence base on which it is drawn, in order to provide us with a further level of independent assurance upon its contents, findings and recommendations before we take any further action.
Regrettably this will mean a further extension of time, … but it continues to be my view that the seriousness of the allegations that we are investigating and now the seriousness of the concerns raised by Cllr Hussain are such that the most thorough and independent investigation is required."
It appears that the comments by Mr Greenburgh were not revealed to the Claimant until he saw the Opinion of Mr Goudie when it was published on 20th May 2016: see paragraphs  –  below.
(x) The Wragge Report of 26th April 2016
"1.10 The author is a partner in the international firm, Gowling WLG (UK) LLP, formerly known as Wragge Lawrence Graham & Co LLP. He is a solicitor advocate and specialises in local government employment and corporate governance work. He leads the Public Sector Group which encompasses local and central government, social housing, social care and regeneration teams. His biographical details are attached at (pages 1-3), but as it has become a matter of some comment, we make clear that the author was a member of Buckinghamshire County Council between 1993 and 2001 and its Conservative Leader between 1997 and 2001. He served on the NDPB, the Beacon Councils Scheme from 2004 to 2010 concluding his tenure as vice chair; and now he sits on the City of London Corporation Standards Committee as an independent co-opted member. All of this background was known to the instructing team from Sandwell, indeed it is published on the website for our firm.
The Councillors' response to the 'Maxwell' letter indicated a concern on their part that either an elected political service or indeed this firm's unsuccessful tenure (a significant time previously) for work from the Council, might in some way have swayed our judgment in the conduct of the investigation or the findings we have reached.
1.11 Whilst conscious of the need for transparency and the need for justice being seen to be done, all of the relevant facts were known to both the officer team and indeed the interviewees at the time of their meeting with the author to give evidence. Those issues were not raised then, nor at any subsequent point before the provisional views were shared in the 'Maxwell' letters.
1.12 We considered at the outset, as we must, whether there was any actual or perceived conflict of interest with the Council or any of the principal witnesses, or any confidential information that would preclude the writer or the firm from acting independently. We were, and have remained at all times, satisfied that we are independent and have approached the issues professionally, impartially and fairly, assessing each issue on its merits alone."
(xi) The Goudie Opinion
(xii) The Claimant is notified of the intention to publish
(xiii) The application for permission to apply for Judicial Review: 19th May 2016
"It is with no disrespect to Mr Oldham that I regard the first three and last two grounds as hopeless. The Council had ample vires to commission, accept and act on the Report. The comment about Councillor Hussain's family by one of the investigators was, in my view, extremely unfortunate (to put it no higher) but for the reasons given in the Chief Executive's letter, endorsed by Mr Goudie, it does not eviscerate the investigation or the Report. The argument about procedural flaws in the investigation falls away in the light of the Maxwellisation process, the subsequent opportunity to make representation and Mr Goudie's report. Political bias cannot come into it when such serious allegations demanded an investigation by the Council as a whole. It follows that Wednesbury unreasonableness does not enter the picture."
(xiv) The initiation of the formal investigation: 3rd June 2016
(xv) The Audit Report and the extension of the investigation: 18th January 2017
"114. It is important to the Council that the Committee, Council Members, staff, tax payers, wider public and the media can see these matters are being dealt with comprehensively and promptly, even when they relate to issues some years in the past. The Council needs to draw a line under these matters, taking action when necessary, so the whole organisation can look to the future."
"1.19 The Committee will know that the Council has, in accordance with statute, adopted specific arrangements for the handling of allegations of the breach [of the] Member Code of Conduct. The initial stage is for such allegations to be considered by the Council's Monitoring Officer. The Monitoring Officer will have to consider the conduct alleged; the applicable Code at the relevant time and whether additional information is required before deciding whether the formal Standards investigation is required. The Monitoring Officer may seek assistance from the Council's Independent Persons in making that decision. Should the Audit Committee refer matters to the Monitoring Officer then it will have the right of any other Complainant under these arrangements."
(xvi) Audit Committee accepts recommendations in Audit Report: 26th January 2017
(xvii) The draft Price Report
(xviii) The final Price Report: 20th February 2017
(xix) Reference of the Price Report to a hearing of the Standards Committee
(xx) The stay of the present investigation ordered by Mr Justice Andrew Baker
(xxi) The Standards Committee hearing
C. The Statutory Framework Governing the Council's Investigatory Powers
(ii) Local Government Act 1972 ("LGA 1972"): Sections 111, 123 and 151
"Subsidiary powers of local authorities.E+W
(1)Without prejudice to any powers exercisable apart from this section but subject to the provisions of this Act and any other enactment passed before or after this Act, a local authority shall have power to do any thing (whether or not involving the expenditure, borrowing or lending of money or the acquisition or disposal of any property or rights) which is calculated to facilitate, or is conducive or incidental to, the discharge of any of their functions."
Without prejudice to section 111 above, every local authority shall make arrangements for the proper administration of their financial affairs and shall secure that one of their officers has responsibility for the administration of those affairs."
(iii) "Responsibility": Regulation 2 of the Functions Regulations
(iv) Sections 1 and 2 of the Localism Act 2011
"Local authority's general power of competence
1. A local authority has power to do anything that individuals generally may do.
2. Subsection (1) applies to things that an individual may do even though they are in nature, extent or otherwise—
unlike anything the authority may do apart from subsection (1), or
unlike anything that other public bodies may do.
In this section 'individual' means an individual with full capacity.
Where subsection (1) confers power on the authority to do something, it confers power (subject to sections 2 to 4) to do it in any way whatever, including—
(a) power to do it anywhere in the United Kingdom or elsewhere,
(b) power to do it for a commercial purpose or otherwise for a charge, or without charge, and
(c) power to do it for, or otherwise than for, the benefit of the authority, its area or persons resident or present in its area.
(5) The generality of the power conferred by subsection (1) ('the general power') is not limited by the existence of any other power of the authority which (to any extent) overlaps the general power.
(6) Any such other power is not limited by the existence of the general power (but see section 5(2)).
(7) Schedule 1 (consequential amendments) has effect."
(v) Sections 27 and 28 Localism Act 2011: Statutory incorporation of the Nolan Principles
"The standards of professional behaviour in the Police (Conduct) Regulations and the guidance are underpinned by codes of ethics. The Association of Chief Police Officers has adopted the Nolan Principles as its code: selflessness, integrity, objectivity, accountability, openness, honesty, and leadership. The College of Policing has published a code of ethics which builds on these principles. The code states that the principles should inform every decision and action across policing. The principles should be more than words on a page and must become embedded in the way police professionals think and behave. Under the code chief officers must, inter alia, show moral courage to do the right thing even in the face of criticism, and must promote openness and transparency within policing and to the public. In spelling out the standard of honesty and integrity, the code of ethics gives as one example 'not knowingly making a false, misleading or inaccurate oral or written statement in any professional context'."
"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."
"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—
(a) selflessness; (b) integrity; (c) objectivity; (d) accountability; (e) openness; (f) honesty; (g) leadership."
"(5) A relevant authority may—
(a) revise its existing code of conduct, or (b) adopt a code of conduct to replace its existing code of conduct.
(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."
"(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.
(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."
"(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."
(vi) Interpretation of Section 28 LA 2011: Can a Council conduct a pre-formal investigation?
a) First, section 28(4) is concerned with what happens after there is a "failure to comply" with a Council's code. On its terms it says that it is concerned with how the failure is "dealt with". It does not address how the allegation of failure is investigated, i.e. how the finding of failure comes about (under section 28(6)(a)). It is concerned with the later post-investigation Arrangements under section 28(6)(b).
b) Second, the conclusion that section 28(4) is concerned with the effects of prior findings of breach is confirmed by the second part of section 28(4) (cf the words after the semi-colon). The use of the phrase "in particular" indicates that the subject matter of this part of the section falls within the same subject matter of the first part. This part of section 28(4) concerns the legal consequences of a finding that a member has acted in breach of the code on consequential decisions. An example of such a "decision" might be the decision to convey or transfer a legal interest in land. The mere fact that there is a finding of failure does not by that fact alone invalidate the conveyance or transfer. This reinforces the conclusion that section 28(4) is generally concerned with a Council's Arrangements which address the position following a finding of breach.
c) Third, section 28(11) makes sense in this context. It is concerned with the "action" that may be taken following a finding of breach. The words in parenthesis are based upon the premise that there has been a finding of failure to comply which has arisen outwith the formal Arrangements under section 28(6). As Mr Goudie QC argued those words are inconsistent with the suggestion that investigations into alleged breaches can only ever be conducted under formal Arrangements.
d) Fourth, this analysis makes practical sense in the context of Parliament's intent. The provisions in the LA 2011 governing investigations were described as "puzzling" and unclear by Edis J in John Taylor v Honniton Town Council et ors  EWHC 3307 (Admin) paragraphs ,  and . He rightly stated that the solution had to be found by identifying the Parliamentary intent. Allegations against members can be investigated formally or informally. If the Council finds a breach by a member then it can impose no sanction open to it under its arrangements unless it then invokes the formal Arrangements (as per section 28(4)). Only then does it become empowered to take "action" and impose any form of sanction. For the reasons I have given above I consider that this interpretation accords with the intent of Parliament. It eschews undue formality. It ensures however that no sanction can be imposed upon a member without the formal Arrangements having been invoked.
e) Fifth, the reliance placed on Credit Suisse (ibid) does not assist. A ruling on the interpretation of the LGA and section 111 thereof does not read across to the LA 2011 especially given section 1 LA 2011 which, unlike section 111 LGA 1972, is free standing and not subsidiary.
f) The net effect is that the Claimant's argument that the Council can only ever investigate an alleged failure to comply with a Code via the formal Arrangements and that there is no scope for pre-formal inquiries, is rejected.
D. Ground 1: Actual and Apparent Bias
(i) Introduction: The Claimant's submission
(ii) Existence of bias
(iii) The risk that bias could infect the decision
(iv) Precautionary safeguards
a) As part of the Standards Committee proceedings no use should be made of the contents of the Wragge Report. This does not, however, prevent subsequent analysis of the Wragge Report or references to it, for example contained in the Opinion or in the Price Report, being placed before the Standards Committee. Further, this does not prevent the evidence upon which the Wragge Report is based also being placed before the Committee. I note that the Council has already indicated that no reliance will be placed on the Wragge Report before the Standards Committee.
b) A concise statement should be prepared (with the Claimant being given an opportunity to comment upon a draft) by way of briefing to the Standards Committee. This should explain why the contents of the Wragge Report are not to be used. It will serve to provide explanatory context to any other documents which may be placed before the Committee which do refer to the Wragge Report. Nothing prevents this Judgment being provided to the Committee.
c) Nothing in these directions prevents the Claimant, should he so wish, referring to the Wragge Report. The direction I make is based upon the Claimant's argument that he risks prejudice by reason of the contents of the Wragge Report and the Claimant is entitled to waive any such concern if he feels it is in his advantage to do so. In the event that the Claimant decides to refer to the contents of the Wragge Report, the Council will not then be precluded from referring to any other part of that Report in so far as reasonably necessary to provide context to any submissions made by the Claimant.
(v) Guidance from case law
E. Ground 2: The Investigation was Politically Motivated and Thereby Pursued for an Improper Purpose and/or was Irrational
(i) The Claimant's submission
(ii) Findings of fact
F. Ground 3: The Decision to Continue the Investigation in the Light of the Evidence of Bias was Irrational and/or Wednesbury Unreasonable
(i) The Claimant's submission
F. Ground 4: There was No Lawful Power to Investigate Alleged Misconduct Pre-Dating the Coming into Effect of the Localism Act 2011 (1st July 2012)
(i) Claimant's submissions
(ii) The Council's submissions
"The Courts will presume that Parliament did not intend a statute to have consequences which are objectionable or undesirable; or absurd; or unworkable or impracticable; or merely inconvenient; or anomalous or illogical; or futile or pointless."
And at paragraph :
"But the strength of these presumptions depends on the degree to which a particular construction produces an unreasonable result. The more unreasonable a result, the less likely it is that Parliament intended it: see (in a contractual context) Wickman Machine Tool Sales Ltd v L Schuler AG  AC 235 at p 251 per Lord Reid. I do not, therefore, find it profitable to discuss whether the effect of the ESI Order amounts to 'double taxation' or 'double assessment' (whether straightforward or not) or the rather less objectionable 'double recovery'. I would prefer to go straight to the real question: whether the scheme established by the ESI Order is so oppressive, objectionable or unfair that it could only be authorised by Parliament by express words or necessary implication."
"In any event there is nothing in ss 27 or 28 LA 2011 to preclude the Council from using its arrangements to investigate allegations outside the scope of those sections. The Council has a number of different powers to investigate allegations of wrongdoing… there is no reason why the Council should not use the procedures laid down by its arrangements in the exercise of those other powers."
G. Ground 5: Section 151 LGA 1972: The Authority Acted Unlawfully under Section 151 and it is Impermissible to Rely Upon the Safe Harbour Provisions of the LA 2011
(i) Claimant's submissions
"It follows that my answer to question (1) is only of academic interest. In the circumstances, I propose to deal with it relatively briefly. The relevant powers are sections 111 and 112 of the 1972 Act, either alone or in combination. On behalf of Mr Gough, Mr Oldham referred, very much as a fallback position, to section 2 of the 2000 Act, which gives local authorities power to promote the economic, social and environmental well-being of their areas. This power cannot avail the council: section 2 did not come into force until 18 October 2000, and at no stage in the council's decision-making process thereafter did it consider, or purport to consider, the exercise of any power under section 2. It is not merely that the section was never mentioned by the council, the council never considered the substance of the discretions conferred by section 2 after they came into force on 18 October 2000."
H. Ground 6: The Matters under Investigation are Stale and the Continuation of the Investigation is Oppressive and Unreasonable
(i) Claimant's submission
"41. Clearly a public body may choose to deploy powers it enjoys under statute in so draconian a fashion that the hardships suffered by affected individuals in consequence will justify the Court in condemning the exercise as irrational or perverse. That is of course the language of wednesbury, as I have said. It may well be that the Court's decision in such cases today would more aptly be articulated in terms of the proportionality principle; indeed, as likely as not, one or other of the guarantees secured in the European Convention on Human Rights ("ECHR") would be engaged… At all events it is plain that oppressive decisions may be held repugnant to compulsory public law standards."
I. Ground 7: The Investigatory Proceedings are Unlawful because the Investigating Officer Appointed by the Monitoring Officer in her Report made "Findings" of Breach by the Claimant and Thereby she predetermined the Outcome and Usurped the Adjudicatory Function of the Standards Committee
J. Ground 8: The Disclosure of the Wragge Report, Opinion and Audit Committee Report Breaches the Data Protection Act 1998 (DPA 1998) / Article 8 ECHR
(i) Claimant's grounds of challenge
(ii) The test to be applied: Section 4(4) and Schedule 1(1) DPA 1998
1. Personal data shall be processed fairly and lawfully and, in particular, shall not be processed unless—
(a) at least one of the conditions in Schedule 2 is met, and (b) in the case of sensitive personal data, at least one of the conditions in Schedule 3 is also met.
2. Personal data shall be obtained only for one or more specified and lawful purposes, and shall not be further processed in any manner incompatible with that purpose or those purposes.
3. Personal data shall be adequate, relevant and not excessive in relation to the purpose or purposes for which they are processed.
4. Personal data shall be accurate and, where necessary, kept up to date.
5. Personal data processed for any purpose or purposes shall not be kept for longer than is necessary for that purpose or those purposes.
6. Personal data shall be processed in accordance with the rights of data subjects under this Act.
7. Appropriate technical and organisational measures shall be taken against unauthorised or unlawful processing of personal data and against accidental loss or destruction of, or damage to, personal data.
8. Personal data shall not be transferred to a country or territory outside the European Economic Area unless that country or territory ensures an adequate level of protection for the rights and freedoms of data subjects in relation to the processing of personal data."
"Conditions relevant for purposes of the first principle: processing of any personal data
1. The data subject has given his consent to the processing.
2. The processing is necessary—
(a) for the performance of a contract to which the data subject is a party, or
(b) for the taking of steps at the request of the data subject with a view to entering into a contract.
3. The processing is necessary for compliance with any legal obligation to which the data controller is subject, other than an obligation imposed by contract.
4. The processing is necessary in order to protect the vital interests of the data subject.
5. The processing is necessary
(a)for the administration of justice,
(aa) for the exercise of any functions of either House of Parliament,
(b) for the exercise of any functions conferred on any person by or under any enactment,
(c) for the exercise of any functions of the Crown, a Minister of the Crown or a government department, or
(d) for the exercise of any other functions of a public nature exercised in the public interest by any person."
6. (1) The processing is necessary for the purposes of legitimate interests pursued by the data controller or by the third party or parties to whom the data are disclosed, except where the processing is unwarranted in any particular case by reason of prejudice to the rights and freedoms or legitimate interests of the data subject.
(2) The Secretary of State may by order specify particular circumstances in which this condition is, or is not, to be taken to be satisfied."
(iii) Personal sensitive data
(iv) 1st principle: Conditions 3, 5(b) and 5(d) and 6
a) Publication enabled the public to see the full picture: By the time that the Wragge Report and the Opinion were published, on 20th May 2016, many of the allegations against the Claimant had been thoroughly aired in the press and on social media and the existence of the Report and the Opinion were also known in the public domain. The coverage of that material had, in some measure, been partisan and not always accurate. There were strong arguments for concluding that it was fair to all parties to ensure that the entire documents could be seen and evaluated by the public, rather than having snippets referred to and innuendoes drawn from those snippets. Fairness in this context does not necessarily indicate that all persons mentioned in the documents should be happy by publication; it means that the full picture is presented transparently. As Mr Goudie QC pointed out, the publication of the Opinion in conjunction with the Wragge Report mitigated various critical comments made in the Wragge Report. It provided a fuller and more rounded picture of the state of the investigation.
b) The probability that information about the investigation had already been leaked by politicians for political purposes: Mr Oldham QC argued that various politicians had been selectively briefing the press for their own reasons and this made publication an intrinsically political and unfair act. I disagree. It does not make publication unfair that much of the material which fell into the public domain prior to full publication had been leaked, and probably deliberately so, by various Labour party Councillors, MPs and/or the Labour party itself in an attempt to curry favour (or disfavour) with the electorate in the light of the imminent election. The decision on publication taken by Mr Britton, the Chief Executive, had to be taken on an apolitical basis. He was, it seems to me, caught between the devil and the deep blue sea. Whichever decision he took could either advantage or disadvantage one member or another in the forthcoming election. If he published he risked being criticised for political partisanship (as he now is) but if he failed to publish he risked strong criticism for deliberately concealing serious wrongdoing (which he was at the time, prior to publication). At the end of the day he had a duty to adopt a dispassionate and objective conclusion as to what was best for the Authority as a whole in the light of his statutory duties, and he complied with that duty.
c) Publication avoided an impression of concealment: There was a strong public interest in the rate payers of the borough having explained to them the nature of the allegations, the evidence both for and against the Claimant, and the views of independent lawyers. It was fair to publish because it proved to the public that the officers were taking their responsibilities seriously and not concealing possible wrongdoing, which was the prevailing impression. Public confidence in financial probity, which includes transparency, especially in times of financial austerity, is very important.
d) The disclosed material reflected a serious prima facie case to be answered: The Wragge Report, the Opinion and the Audit Report, in my judgment, set out evidence which created a serious prima facie case of misconduct including breach of the Council's standards. There was, as of the date of publication, a case to be answered. Fairness takes into account the nature and depth of the investigations reflected by the documents published and the strength of the case reflected therein.
e) The change from past practice: The Claimant argues that the Council had not published equivalent material in the past. There was not much focus upon past-history in the course of the case and I do not have much (if any) evidence upon which to form any sort of a firm conclusion on this. But assuming the allegation to be true it is not in my view an answer. If, but for this point, there is a proper case for publication, then it does not become a bad case simply because a new and more transparent policy was adopted by the Council in this case than hitherto.
f) Deterrent effects: The Claimant says that it is "impossible to see how publication of unproven allegations to anyone, let alone the world, would help maintain high standards". I disagree: sunlight bleaches. If members know – because the Authority's policy is to publish in an appropriate case – that improper conduct, if it comes to light, will be exposed to the glare of public scrutiny then this, in and of itself, can act as a deterrent to misconduct in the first place. I do not accept that it is wrong or unfair in principle to publish allegations, as opposed to ultimate findings. Allegations are disclosed in every criminal court before a verdict by the very nature of the procedure. Regulatory and disciplinary proceedings that are held in public also involve disclosure of the allegations. And the same is true of civil claims, for instance alleging fraud, which takes place in the County Court or High Court. A hearing before the Standards Committee may, under the Arrangements, be held in public. The simple fact that publications address allegations but not findings is not therefore, per se, a reason not to publish.
g) The private impact of publication on the subject of investigation and their affected families: I accept that the impact on those who are the subject matter of the publication is relevant to fairness. Mr Hussain has put before the Court extensive evidence of the distress and concern felt by himself and his family. He argues that his private life and that of his family was violated by publication. I do not doubt that publication did have adverse effects upon the Claimant and his family. But the allegations are about Mr Hussain acting in his public capacity. The allegation in relation, for instance, to the toilets is that in his capacity as an important and influential local politician he used his power to confer a pecuniary advantage upon a third party with whom he had a close connection to the disadvantage of the rate payer. An allegation made in any sphere of public life about a politician may impact personally upon the politician and his or her family. But that does not alter the quintessential nature of the allegation and the issue to be resolved as one of public not private concern. I share the view expressed in DH v Information Commissioner & Bolton Council  UKUT 0139 at paragraphs  and  that a Councillor should expect to be scrutinised as to and be accountable for his actions in so far as relevant to his public office and that those who take on public office should expect to be subject to a "higher degree of scrutiny and that information which impinges on their public office might be disclosed". In the present case whilst fairness requires me to take account of the impact of publication I do not consider that it outweighs the factors favouring publication.
(v) 3rd and 4th Principles
(vi) Article 8 ECHR
(vii) Alternative remedies
K. Ground 9: Publication was Politically Motivated and thereby for an Improper Purpose and / or Irrational
L. Ground 10: Publication was Ultra Vires the Council's Powers and was Not an Act Contemplated by the Council's Formal Arrangements in Place for Investigations under the Localism Act 2011
M. Ground 11: The Solicitor's Report was infected with Bias and Publication was Accordingly Irrational and / or Unreasonable as was any Other Document (such as the Opinion) Which Referred to it
N. Ground 12: Materiality