Scottish Court of Session Decisions

FIRST DIVISION, INNER HOUSE, COURT OF SESSION

[2016] CSIH 44

P715/15

Lord President

Lady Clark of Calton

Lord Malcolm

OPINION OF THE COURT

delivered by LORD CARLOWAY, the LORD PRESIDENT

in the reclaiming motion

JOHN STEWART MAUGER

Petitioner and Reclaimer;

against

THE CHIEF CONSTABLE OF POLICE SCOTLAND

 First Respondent;

and

THE SCOTTISH POLICE AUTHORITY

Second Respondents:

Act: McBrearty QC, Hay; bto

Alt: Maguire QC; Clyde & Co

Alt: Poole QC; DLA Piper

10 May 2016

Introduction
[1]        This is a reclaiming motion from an interlocutor of the Lord Ordinary, dated 29 January 2016, dismissing a petition for judicial review.  The petition sought reduction of a decision taken by a Review Panel, and communicated by letter dated 8 May 2015, upholding a decision taken by a Force Vetting Officer, on 18 March 2015, refusing the petitioner Management Vetting clearance under the Standard Operating Procedure of Police Scotland.

[2]        The petitioner’s challenge primarily raised a question of procedural fairness and, in particular, whether the Review Panel were obliged to raise with the petitioner concerns, which they ultimately founded upon, about inconsistencies in his clearance application questionnaires.

Management Vetting clearance procedure
[3]        Security vetting operates at a number of levels within the police.  Each force has a Force Vetting Unit, and appoints a Force Vetting Officer.  The first respondent has instituted a Standard Operating Procedure for the vetting of police officers in Scotland.  This requires to be read alongside the several National (United Kingdom) SOPs.

[4]        Management Vetting applies to police officers who hold posts in “designated sensitive areas” and thus have access to “sensitive Police information, intelligence, financial or operational assets”.  The purpose of the vetting is to assess the “reliability and integrity” of those officers in order to “reduce the risks of unauthorised disclosure, or loss of, sensitive Police assets” (Police Scotland SOP, para 6.1).  The rank of Assistant Chief Constable requires MV clearance. 

[5]        In order to obtain clearance, the applicant requires to fill in two questionnaires, relating respectively to personal and financial information.  He must also provide information about third parties, including spouses, family members, and associates.  The Force Vetting Officer takes the initial decision, often after an interview with the applicant.  If the applicant disputes the decision, he may apply for a review by a panel consisting of a Chief Superintendent, a senior member of the Human Resources Staff and the Head of Counter Corruption (para 6.4.18).  The appellant must be given “the opportunity to make personal representations and may be accompanied by a colleague or a Trade Union representative” (para 6.4.19).  A written decision specifying the “reasons behind it” is required (para 6.4.20).

[6]        National SOP 4 deals with the factors to be taken into account in Management Vetting.  It repeats the purpose as being an assessment of “reliability and integrity” (para 3.1).  A number of factors are listed as creating a presumption of unfitness.  They include “Providing false or deliberately misleading information, or omitting significant information from the vetting questionnaires” and “Unauthorised association with persons with previous convictions...” (para 5.1).  There is a continuing obligation to disclose changes in personal circumstances, including “known/suspected criminal association” (SOP 10, para 4.1).

[7]        National SOP 16 deals with third party risk assessments.  Where adverse information is uncovered about a third party, factors such as evidence of joint enterprise, the gravity of offences committed by the third party and the nature of the relationship between the parties, will all operate against clearance being granted (para 4.3).  Factors which support clearance include evidence of distance between the applicant and the third party, the openness of the applicant and his ignorance of the third party’s activity (ibid).  Where the details of a notifiable individual (associate) are missing from the vetting forms, and adverse information is held about that individual, that is “an integrity issue” (para 4.7).  The presumption is that the information has been deliberately omitted (ibid; and Police Scotland SOP, para 17.5).

Facts
[8]        The petitioner is a police officer.  He joined the police in 1983.  In 2009, he became Assistant Chief Constable of Central Scotland Police.  The petitioner obtained Management Vetting clearance from Central in August 2009, having previously had clearance with another force.  In April 2013, he transferred to Police Scotland, retaining the same rank.  

[9]        In about 2000, whilst living in England, the petitioner met a music and events promoter, named BR.  The petitioner and Mr R developed a friendship, which involved socialising with their spouses, both at each other’s homes and at public events.  In July 2013, the petitioner borrowed £250,000 from Mr R.  The loan was undocumented, unsecured and interest free.

[10]      In July 2013, the petitioner submitted an application for the renewal of his MV clearance.  He declared the existence of the loan, but did not identify the lender, beyond describing him as a “friend”.  He referred to “a loan with no interest or conditions… [which] will be returned if I don’t go ahead with future plans or on receipt of the communtation (sic) at the point of retiring or when capital is released from a house sale”.  The petitioner avers that he decided to return the money in early August 2013, and had communicated that to Mr R.  

[11]      In October 2013, following the breakdown of the Rs’ marriage, the petitioner was told by Mrs R that her husband had convictions for assault, fraud and firearms offences, for which he had received custodial sentences.  The last such sentence had been imposed in 2000.  Although the details of the convictions were not formally given to the petitioner in the vetting process, it was not disputed that they exist.  On 16 October 2013, the petitioner sent an email to a superior officer, who was not concerned with vetting procedure, which told of the petitioner’s friendship with “a married couple”, who were “going through a bitter acrimonious separation”.  It said “today the wife disclosed to me that the husband has criminal convictions and that he has served time in prison.  I was and have been completely unaware of this”.  The email did not identify Mr R by name, nor was the loan of £250,000 mentioned. 

[12]      On 1 November 2013, a “freezing” injunction was granted by the Family Division of the High Court of Justice in London.  This prohibited the petitioner (amongst others) from taking any steps to defeat Mrs R’s claims by dealing with, or disposing of, Mr R’s assets.  On 15 November 2013, the petitioner “returned” the loan funds.  Although the relevant documentation was not all produced, it was accepted that the return followed an order from the High Court.  The basis for this was not explained, nor was it said to whom the monies had been returned.

[13]      In July 2014, the petitioner was interviewed in relation to his application.  There is a dispute as to whether Mr R was named at that time.  On 14 August 2014, the petitioner provided a witness statement in the divorce proceedings to support Mr R’s application for contact with his children.  In that statement, the petitioner set out details of his police experience in order to add weight to his evidence.  No mention was made of Mr R’s previous convictions.

[14]      On 2 September 2014, the petitioner was refused MV clearance by the Force Vetting Officer.  He tried to obtain a review of this decision, but he was out of time.  After the refusal, he completed a Notifiable Association Report relating to Mr R.  In this, he described Mr R as a friend, with whom he had had increasing social contact since 2000, and with whom he had had recent contact in 2014 at social events.  He explained that the Rs were going through an acrimonious separation, during which he had learned of Mr R’s previous convictions.  No mention was made of: the loan of £250,000; the witness statement in support of Mr R; or the injunction.  The petitioner said that he had “no knowledge” of Mr R’s businesses.  The description of Mr R’s address was left incomplete and his mobile phone number was expressly withheld.

[15]      On 19 December 2014, as a result of the refusal of clearance, the second respondents gave notice to the petitioner that they intended to call upon him to retire or be required to resign on the grounds of effectiveness or efficiency, in terms of section 14 of the Police and Fire Reform (Scotland) Act 2012.  

[16]      On 2 February 2015, the petitioner submitted a fresh application for MV clearance.  In the financial questionnaire, the petitioner described the events in 2013, when he had received £250,000 from “a (then) associate”, Mr R.  He explained that the money had been returned and had never been used.  He stated that the return had been delayed “as a result of an unexpected separation and claims from both parties”.

[17]      On 8 March 2015, the Force Vetting Officer advised the petitioner that she had refused his application on two principal bases, first, “the financial arrangement you entered into in 2013 with Mr [R]”, and, secondly, “adverse information held by Police Scotland”.  The latter statement is the standard method of referring to a third party associate having previous convictions.  The petitioner sought review of this decision. 

[18]      A Review Panel hearing was held on 1 May 2015.  The petitioner was represented by counsel.  He had been provided with copies of all of the material considered by the Force Vetting Officer.  This consisted of an incomplete copy of the injunction, the two sets of vetting application questionnaires, the Notifiable Association Report, the witness statement in the divorce proceedings and two articles from the Sun newspaper.  This was all the material which the Panel had, beyond such information as might be provided by the petitioner’s counsel.  Counsel took the opportunity of addressing the Panel in the one hour hearing afforded.  He covered the petitioner’s career achievements, but did not deal with omissions and differences in the forms and related matters.  In accordance with normal practice, the Panel did not ask the petitioner any questions.  In terms of the rule (supra), they simply permitted him to make such representations as he chose to present.

[19]      The Review Panel upheld the refusal of clearance.  Their decision letter of 8 May 2015 noted that, in terms of the SOPs, the relevant factors for the refusal of clearance included “the provision of false or deliberately misleading information or omitting significant information from the vetting questionnaires”.  The Panel reached the view that the two questionnaires completed in 2013 and 2015 contained “obvious inconsistencies about material matters”.  “Critically … the panel noted that the position in relation to the receipt of the £250,000 was not stated consistently”.  The Panel also noted, as a SOP factor, “having an unauthorised association with a person with previous convictions”.  They considered that the petitioner had had such an association with Mr R, and that the terms of that association, including “the provision of a ‘character reference’ for him in connection with civil proceedings”, demonstrated them to be routinely close.  The Panel noted that the petitioner had not disclosed “the existence of civil court proceedings to recover a large sum of money from you in connection with divorce proceedings, between your associate and his then wife when served with a High Court Order”.  The Panel stated: “On the basis of these matters alone, the financial agreement entered into between you and [Mr R], the Panel is satisfied that it should not rescind” the Force Vetting Officer’s decision.

Decision of the Lord Ordinary
[20]      There were originally five grounds of challenge to the Review Panel’s decision.  However, only two are relevant for present purposes.  First, it was contended that the petitioner had not had fair notice that the information provided by him in the questionnaires, as opposed to the fact of the loan itself, was a sufficient basis upon which to refuse the review.  The Review Panel had erred in stating that there were inconsistencies between the two questionnaires.  The Lord Ordinary considered that the petitioner would have been well aware that the manner and extent to which information, about his relationship with Mr R, was provided would have been of concern to both the Force Vetting Officer and the Review Panel.  An applicant would be aware generally that the decision maker would require to assess his reliability.  The consistency of statements that he had made would be relevant to that assessment (HA v Secretary of State for the Home Department (No 2) 2010 SC 457, Lord Reed at paras [10] to [13]).  The Lord Ordinary considered that there were obvious factual inaccuracies and omissions in the two questionnaires and the Notifiable Association Report made in September 2014.  The petitioner had become aware of Mr R’s criminal convictions in October 2013, but he had not contacted the Force Vetting Unit at that stage.  In July 2013 and October 2013, he made incomplete disclosures to two separate police authorities.  He did not report the injunction to the Force Vetting Officer, nor did he refer to the fact that he had made a statement supportive of Mr R.   Both pieces of information were relevant to the assessment of the nature of his relationship with Mr R.  In the Notifiable Association Report, he had failed to mention the loan, the divorce proceedings, the injunction, and the witness statement.  The Review Panel had been entitled to conclude that the petitioner had been attempting to minimise his relationship with Mr R.  There was an inconsistency in his position about his knowledge of the divorce proceedings, as well as the purpose of the loan and the return of the funds.  There was ample material before the Panel to support their conclusion.  The factors which they considered to be relevant were all those which they had to take into account under the terms of the SOPs.

[21]      The second relevant ground was that the Review Panel had misunderstood the nature of the injunction.  They appeared to think that the petitioner was being pursued for recovery of a debt.  No reasonable decision maker could have concluded that the injunction was a relevant matter.  The Lord Ordinary rejected that argument.  The Panel were substantially accurate in describing the court order as civil proceedings to recover money from him in connection with the divorce.  The witness statement that he had provided in support of Mr R in those proceedings was in essence a character reference.  The petitioner’s involvement in the divorce proceedings was relevant to the nature of the relationship between the petitioner and Mr R.

Submissions
Petitioner
[22]      The petitioner submitted that the Lord Ordinary had erred in concluding that the inconsistencies between the documents did not require to be drawn to the petitioner’s attention.  He had erred in applying Lord Reed’s dictum in HA v Secretary of State for the Home Department (No. 2) (supra, at paras [10] to [13]).  What fairness demanded was dependent on the context of the decision (HA (supra, Lord Reed at para [4], citing R v Secretary of State for the Home Department, ex p Doody [1994] 1 AC 531, Lord Mustill at 560, recently followed in R (Bourgass) v Secretary of State for Justice [2015] 3 WLR 457, Lord Reed at paras 96-97).  The assessment of fairness was “intuitive” (ibid).  However, fairness often required that a person be given an opportunity to make worthwhile representations, which could only be formulated by knowing what factors might weigh against him.  He required to be informed of the gist of the case which he had to answer (Lord Mustill, ibid).  In so far as HA (supra) stated (Lord Reed at para [10]) that there was no general obligation upon a tribunal to give notice during the hearing of all matters on which it may rely in reaching its decision, it was inapplicable since, in HA, there was an evidential onus on the applicant for asylum to prove a particular state of affairs.  The applicant would know what he had to prove and thus what evidence he required to lead.  He would have been aware of his previous accounts.

[23]      There had been no notice of the Panel’s perception of inconsistency.  The decision of the Force Vetting Officer had not been based on credibility.  All that the petitioner had been aware of was that his clearance had been refused on the grounds of the loan transaction.  He had not been able to participate effectively in the decision making procedure, since his integrity had been impugned on the basis of something which he had not been told about (see R (Osborn) v Parole Board [2014] AC 1115, Lord Reed at paras 67-68).  The issue of the financial arrangement was distinct from the petitioner’s honesty and integrity.  The petitioner’s counsel had made representations about the loan, since that is what the review was ostensibly about.  He had not made any submissions on omissions or inconsistencies.  There had been no contradictor and therefore no opportunity to respond to any criticisms based on these omissions or inconsistencies.  In any event, there was no inconsistency between the two questionnaires.  There may have been inconsistencies with the Notifiable Association report, but the decision letter had not mentioned it.

[24]      It was not for the court to assess whether any explanation for the inconsistencies or omissions would have been acceptable.  That could only be done by the Review Panel in the event of a remit.  It could not be said that a decision adverse to the petitioner was inevitable.  Where a party had not been given an opportunity to make representations, it was not easy to say what difference it might have made (R v Broxtowe BC ex p Bradford [2000] IRLR 329, Lord Woolf MR at 329, following R v Chief Constable of Thames Valley Police ex p Cotton [1990] IRLR 344, Bingham LJ at 352).  It was not enough that the decision would probably have been the same.  The standard was inevitability (R (Smith) v North Eastern Derbyshire Primary Care Trust [2006] 1 WLR 3315, May LJ at para 10; Malloch v Aberdeen Corporation 1971 SC (HL) 85, Lord Reid at 104, cf Lord Wilberforce at 118; King v East Ayrshire Council 1998 SC 182, LP (Rodger) at 194-195).

[25]      The Lord Ordinary had erred in construing the injunction as being substantially akin to proceedings to recover a sum of money from the petitioner.  The order was an irrelevant consideration.  The injunction had been akin to an arrestment on the dependence of an action.  There had been no pursuit of the petitioner on the basis of debt.

First Respondent
[26]      The first respondent submitted that the petitioner had failed to identify any error in the reasoning of the Lord Ordinary.  The Lord Ordinary had correctly applied HA v Secretary of State for the Home Department (No. 2) (supra).  That was authority for the proposition that a decision maker is under no obligation to air concerns about the evidence presented, particularly if there were discernible points and the individual was represented.  The petitioner had had notice of the issues to be determined by the Review Panel.  He was well aware that his integrity was under scrutiny.  He knew that one of the issues was the loan from a known criminal and another was his relationship with him.  

[27]      The petitioner had been provided with all of the documents in advance of the hearing.  He knew that the information on the forms was crucial and would be scrutinised.  He was represented by counsel.  That was unusual.  He was provided with the opportunity to make submissions on the material.  The petitioner had failed to identify any prejudice which he suffered as a result of any failure of the Panel to draw the inconsistencies to his attention.  These inconsistencies were obvious.  The petitioner ought to have anticipated that the Panel would consider them and might attach weight to them (HA (supra, Lord Reed at para 31).

[28]      Even if the petitioner had established that the Review Panel should have asked him about the omissions and inconsistencies, he still had to establish that he had something of substance to say about them (Malloch v Aberdeen Corp (supra), Lord Reid at 104, Lord Wilberforce at 118).  A procedural impropriety did not vitiate a decision if no prejudice had been suffered (HA (supra), Lord Reed at para [15] and King v East Ayrshire Council (supra) LP (Rodger) both citing Malloch (supra)).  If the test were one of inevitability, it had been satisfied.  The petitioner had not said what he might have submitted in relation to the omissions and inconsistencies.  In any event the existence of the loan and the association with Mr R, the lender, were sufficient to result in clearance being inevitably refused.

[29]      The Lord Ordinary had not erred in considering that the injunction was a relevant consideration.

Second Respondent
[30]      The second respondent submitted that the crucial part of the decision of the Review Panel had been its statement that, on the basis of the financial agreement alone, it should not rescind the decision to refuse clearance.  It was not appropriate to paste onto the Panel’s decision making process concepts appropriate to adversarial or inquisitorial proceedings.  What natural justice had required was that the petitioner had fair notice of the case against him.  He had been provided with all the information before the Panel and been afforded an oral hearing.  It was inconceivable that he would not have appreciated the significance of the questionnaires and the form.  In any event, reduction of the decision should not be allowed as it would serve no practical purpose.  Any new decision would require to be taken in the light of up to date information.  Reduction was an equitable remedy and ought not to be used in the circumstances.

Decision

[31]      The starting point in the assessment of whether the petitioner had a fair hearing before the Review Panel, which is the essential issue raised in the petition, is to recognise that the Police Scotland Standard Operating Procedure provides him with an entitlement to a hearing before what is an independent panel; each member bringing a particular level of seniority and expertise to the table.  The issue is not entitlement to a hearing (cf Malloch v Aberdeen Corpn 1971 SC (HL) 85 and R v Broxtowe BC ex p Bradford [2000] 1 IRLR 329) but the conduct of that hearing.  Beyond the entitlement to a hearing, there is no express provision in the SOP which regulates the procedure to be followed in advance of that hearing.  The applicant seeking a review need not, for example, specify any grounds of challenge to the Force Vetting Officer’s decision.  None was given by the petitioner.  There are no rules requiring the Panel to notify the applicant of any particular matters.  There is no provision defining the scope of the hearing beyond its function as a review of a Management Vetting clearance decision.  There is no doubt, however, that such a hearing as there was required to be fair. 

[32]      In determining the fairness of the proceedings, the context in which the decision making body operates is important (HA v Secretary of State for the Home Department (No. 2) 2010 SC 457, Lord Reed at paras [4] and [5]).  In this case, the court is not concerned with a statutory tribunal (cf HA) but a Panel operating in what might loosely be described as the public employment context.  The decision is whether, in the interests of security, a police officer’s reliability and integrity is sufficiently robust as to permit him access to, amongst other things, sensitive information and intelligence.  That is the issue which the Panel will be deciding in almost all cases.  It does so having regard to the guidance contained in the National SOPs, which set out, for the benefit of both the Panel and those seeking a review, examples of factors which are likely to be taken into account in assessing an officer’s character.  In these circumstances, an applicant for review ought to be fully aware of the issue to which the Panel will apply their collective mind.

[33]      The degree to which an applicant must be informed of the material suggestive of his unreliability or dishonesty will vary according to the circumstances.  There is no doubt that he must be provided with such notice as enables him to make, in this case, appropriate “personal representations” in his favour.  The petitioner was given the Force Vetting Officer’s decision.  That decision is relatively Spartan in form, but it did highlight both the existence of the loan and the petitioner’s association with the lender as the central features for consideration.  However, that was not the extent of the information (ie notice) provided.  The petitioner was given copies of all the documents which were to be placed before the Panel and upon which he might expect them to base their decision.  These included the questionnaires, the Notifiable Association Report, the e-mail to his superior officer, the witness statement and the High Court papers.  The fact that these documents were supplied to the petitioner must have made it clear to him that they would be duly scrutinised in the context of the factors contained in the SOPs, of which the petitioner was also aware.  It was, after all, the content of these documents which had so occupied the vetting process in which the petitioner had participated.

[34]      There was therefore adequate notice to the petitioner of the material which was likely to be taken into account by the Review Panel.  Thus he would be aware, for example, that in the first application questionnaire he had not identified the lender of £250,000 of unsecured funds.  The reason for having these funds in advance of any actual need is unclear.  In his e-mail, he did not mention the name of the friend whom he knew, at least by then, had significant criminal convictions.  He did not mention the loan.  In the Notifiable Association Report he did mention Mr R, but not the loan, the witness statement or the injunction and the requirement to return the funds.  There were also questionable parts in this Report, notably concerning the extent of his knowledge of Mr R’s business.  In the second application questionnaire there was still a lack of candour regarding the import of the High Court proceedings and the fact and basis for the return of the loan funds.  All of these factors ought to have been matters which the petitioner was aware could influence the Panel.  Of course, his counsel could take a reasoned tactical decision not to address what appeared to be glaring faults in terms of the SOPs factors.  Alternatively, he could have tackled them head on.  He was given an opportunity to say what he wanted to the Panel.  He took advantage of that. 

[35]      There was no requirement on the Review Panel to set out their concerns in advance of the hearing; assuming that they had formulated such concerns at an early stage.  They were entitled to follow the practice, common even in the stricter confines of a judicial hearing, of listening to the representations and taking anything said into account in the final analysis.  In HA (supra) it was said (at paras [13] and [14]) that it may be different when the proceedings are not adversarial, but the basis for that view was the absence of awareness of the grounds of challenge.  That feature is not present in the petitioner’s case.

[36]      The Review Panel’s decision was not based solely on inconsistencies between the two questionnaires.  It was fundamentally grounded on the financial relationship entered into by the petitioner with Mr R.  The earlier observations of the Panel in their decision letter are related to the unsatisfactory nature of the petitioner’s disclosure of the loan and the relationship with Mr R.  The inconsistences were a feature of this, but the decision letter is not confined to the questionnaires.  It refers generally to the loan not being stated consistently (as can be seen in the Notifiable Association Report in comparison with the questionnaires).  The Panel also, in advance of their fundamental conclusion, commented on the closeness of the relationship with Mr R as demonstrated by the witness statement.  This was linked to the failure properly to report the High Court proceedings, which, on the limited paperwork produced, involved far more than the equivalent of an arrestment on the dependence.  The injunction appears to have been prompted by an allegation that the loan was an attempt to defeat Mrs R’s matrimonial claims; a suggestion which is perhaps not surprising given the nature of the loan and the timing of the divorce.  In this context, there is no merit in the contention that there was a misunderstanding on the part of the Panel as to the nature of the injunction.  The Panel’s view on that was substantially accurate.

[37]      The final question is whether, assuming that there was a failure to give proper notice of the omissions and inconsistencies, the petitioner’s position would have been different had he made representations about them.  There is force in the submission that the court should not attempt to second guess the conclusions of the Panel, had submissions explaining the problem areas been made.  In that regard the message conveyed by Malloch v Aberdeen Corporation 1971 SC (HL) 85 continues to echo loudly.  However, it is clear from Malloch (Lord Reid at 104) that, if the respondents can demonstrate the inevitability of failure, the petitioner cannot succeed.  That has been shown.  The stark reality is that, whatever his state of knowledge at the time, the petitioner received from a person with a significant criminal past, a very large sum of money.  Although this was characterised as a loan, it did not bear the normal characteristics of a loan of this magnitude; eg term, security and interest.  The petitioner not only repeatedly failed the test of candour required for MV clearance in respect of this transaction, he continued his association with a person with a criminal background long after he knew of his previous convictions.  In such circumstances, there could have been no reasonable basis for rescinding the Force Vetting Officer’s decision.

[38]      The reclaiming motion must therefore be refused.  The court will adhere to the Lord Ordinary’s interlocutor of 29 January 2016.