Whether the Council was justified in refusing access to records in full or in part relating to the conversion of a building into apartments on the basis of section 36(1)(c) of the FOI Act
12 August 2022
Background
In a request dated 29 September 2021, the applicant sought access to correspondence between the Council and the owners of a building in respect of same being converted to apartments. The applicant listed a number of named individuals that may have been party to the correspondence. The applicant also sought access to planning files relating to the conversion. On 1 October 2021, the Council issued an acknowledgement letter to the applicant. No original decision was issued. By email on 12 November 2021, the applicant wrote to the Council and said that same constituted a deemed refusal and sought an internal review.
In a decision dated 3 December 2021, the Council part-granted the applicant-s request on the basis of section 15(1)(d) and 36(1)(c) of the FOI Act. The correspondence issued references a right of appeal internally to the Council. On 18 February 2022, the applicant applied to this Office for a review of the Council-s decision.
I have now completed my review in accordance with section 22(2) of the FOI Act. In carrying out my review, I have had regard to the applicant-s comments in his application for review and to the submissions made by the Council in support of its decision. I have also examined the records at issue. I have decided to conclude this review by way of a formal, binding decision. In referring to the records at issue, I have adopted the numbering system used by the Council when processing the request.
Scope of Review
In its decision dated 3 December 2021, the Council provided a link to the planning file relating to the conversion of the building which is the subject of the request. It refused to provide further information on the basis of section 15(1)(d) of the FOI Act; that the information is already in the public domain. In communications with this Office, the applicant confirmed that he is satisfied with the information provided and is not seeking a review of same. As such, the Councils- reliance on section 15(1)(d) to refuse access to certain records will not form part of this review.
The Council identified 14 other records which it says come within the scope of the request. Four records were released in full. 10 records were part-granted on the basis of section 36(1)(c). During the course of the review, and following correspondence with this Office, the Council identified five additional relevant records. However, despite multiple requests, the Council did not clarify its position in respect of the release of the additional documents. I consider this to be an effective decision to refuse the records.
Accordingly, this review is concerned solely with whether the Council was justified in withholding information from records 2, 4-11 and 13 on the basis of section 36(1)(c) of the FOI Act and in refusing access to five additional records identified without reference to any specific exemption grounds.
Preliminary Matters
At the outset, I would draw the Council-s attention to its obligations under section 13 of the FOI Act to provide reasoned decisions. An original decision was not issued in this case, with same being considered a deemed refusal. In communications with the Council, this Office asked for an explanation as to why an original decision was not issued. No response was provided. This constitutes a wholly unsatisfactory approach to FOI decision-making.
I expect the Council to take immediate measures to ensure that all future requests are processed in accordance with its statutory obligations. I also strongly encourage its decision makers to use the FOI resources available, including guidance on the FOI Act published by the Central Policy Unit of the Department of Public Expenditure and Reform and by my Office, to assist them in their decision-making and in ensuring that their decisions comply with their obligations under the Act.
Analysis and Findings
Section 36(1)(c) - Commercially sensitive information
Section 36(1)(c) provides that an FOI body shall refuse to grant an FOI request if the record concerned contains information whose disclosure could prejudice the conduct or outcome of contractual or other negotiations of the person to whom the information relates.
The standard of proof required to meet section 36(1)(c) is relatively low in the sense that the test is not whether prejudice or harm is certain to materialise but whether it might do so. Having said that, I would expect that a person seeking to rely on section 36(1)(c) would be able to show that contractual or other negotiations were in train or were reasonably foreseen which might be affected by the disclosure and explain how exactly the disclosure could prejudice the conduct or the outcome of such negotiations. Where an FOI body is relying on this exemption for the refusal of a record, it must go on to consider the public interest and whether section 36(3) applies in relation to the record concerned.
The Council has refused access to ten records in part on the basis of section 36(1)(c). A limited amount of information is withheld and the vast majority of withheld information comprises financial information relating to the proposed cost of the development in question. In particular, such information relates to initial and updated proposed development costs and relates to discussions about whether same were acceptable. The withheld financial figures are repeated throughout the records.
Before proceeding to consider the application of the sub-section to the information in question, I believe it would be useful to briefly outline the process in respect of local authority acquisition of housing units, as detailed by the Council in its submissions.
The Council says that it has a rolling Expression of Interest process whereby developers propose particular turnkey developments. It says that such proposals are evaluated against a number of criteria including social housing need, sustainability, location and cost. If the proposal meets local authority requirements it will submit an application for funding to the Department of Housing, Local Government and Heritage (the Department). It says that the Department will consider the application and, if approved, the Council will enter into a Contract for Sale in respect of the development, paying the agreed price upon completion.
Submissions
In its submissions to this Office, the Council provided limited responses to questions posed in respect of the application of section 36(1)(c). It would appear from the Council-s submissions that the negotiations whose conduct or outcome it believes could be prejudiced by the release of the records in question are future negotiations with developers engaged in the proposal of turnkey development projects. Its position is that release of the records would injure the ability of the Council to -agree turnkey acquisition prices based on the particularity of the proposal-. It says that release would -lead to a common high price being demanded- by developers. Its position is that the market for development and participants in same is relatively small and that the publication of agreed acquisition prices would lead to -distortion of the market as all developers would move to the most expensive agreed prices without due regard to the factors considered by the [local authority]-.
This Office queried whether spending limits apply to such acquisitions and whether same are published. The Council says that the Department issues -Unit Ceiling Costs- (UCC) but that same are issued as correspondence and are not published. It says that the Council will enter into discussions with the developer in respect of the price of units having regard to variables including -the location of the development, the type of unit, the details of the unit in terms of layout and floor area, the type of heating, finishes proposed, etc-.
In his application to this Office, the applicant-s position is that -much of the information exempted under Section 36 of the FOI Act is not commercially sensitive--. He does not provide further elaboration on this point.
As stated, the withheld information in the records comprises financial information relating to the proposed cost of the development advanced by a named third party. Given that the records at issue appeared to affect the interests of the third party, we issued an invitation to make submissions but no such submissions have been received. It is noteworthy that records containing details relating to the third party and the third party-s engagement with the Council have already been released to the applicant by the Council in response to his request.
Analysis
While I accept that future negotiations in respect of turnkey developments are likely to occur, the Council must also demonstrate that such negotiations could be prejudiced by the release of the information in question. I note that considerable detail withheld from the records is already in the public domain. A media article published by the Irish Mail on Sunday in February 2020, entitled -Council tried to block FOI release of costs of TD-s failed social housing deal-, includes key withheld information in respect of the cost of the development and negotiations in respect of same.
Moreover, while price is a factor which the Council states that it considers in deciding whether to proceed with a proposal, it is not the only factor. The Council says that it also considers factors such as location and social housing need. It is open to the Council to refuse applications if the price cited is considered too high or on foot of other factors taken into account. In such circumstances, I fail to see how the Council can reasonably argue that the release of the withheld information would give rise to the harms it identified as described above.
Accordingly, I find that the Council was not justified in relying on section 36(1)(c) to withhold release of records 2, 4-11 and 13 and I direct the release of the records in full to the applicant.
Additional Records Identified
In his application to this Office, the applicant noted that the records released appeared to reference other documents which had not been provided or referenced in the relevant schedule. On foot of correspondence from this Office, the Council provided five additional records. However, despite multiple requests, the Council did not clarify its position in respect of the release of the additional documents. Furthermore, the Council did not provide confirmation that all the referenced documents had been provided.
In respect of the five additional records, there is insufficient evidence before me to make a definitive determination on whether the applicant has a right to access to this information under the FOI Act. The Council-s response is respect of queries posed by this Office has been inadequate. Extensions were provided yet insufficient responses were received.
In the circumstances, I am satisfied that the appropriate approach for me to take is to remit the matter back to the Council for further consideration. This is particularly the case as the records in question contain third party information and the Council is the appropriate body to make a first instance decision in respect of their release. Specifically, I am annulling the Council-s effective decision not to release the five additional records provided to this Office during the review and remitting the matter back to the Council for consideration afresh. I am also directing the Council to undertake all searches afresh to ensure all relevant records are identified.
Decision
Having carried out a review under section 22(2) of the FOI Act, I hereby annul the Council-s decision. I find that the Council was not justified in refusing the release of withheld information on the basis of section 36(1)(c) and direct its release. I annul the effective decision of the Council to refuse access to additional records identified during the course of the review and remit the matter back to the Council for fresh consideration.
Right of Appeal
Section 24 of the FOI Act sets out detailed provisions for an appeal to the High Court by a party to a review, or any other person affected by the decision. In summary, such an appeal, normally on a point of law, must be initiated not later than four weeks after notice of the decision was given to the person bringing the appeal
Stephen Rafferty
Senior Investigator
