Bhatia Best LTD v Lord Chancellor

The issue raised on this appeal is whether under its contract with the Lord Chancellor, Bhatia Best Ltd, a firm of solicitors, (“the Claimant”) is entitled to receive civil legal aid funding for its work while acting for clients in appeals against homelessness decisions under section 204 of the Housing Act 1996, the terms of which together with section 204A of that Act are set out in the Appendix to this judgment.

The Claimant received such funding under the period before the Legal Aid, Sentencing and Punishment of Offenders Act 2012 (“LASPO”) came into force on 1 April 2013. Since then, the Claimant has continued to apply for funding, but the Legal Aid Agency, acting on behalf of the Director of Legal Aid Casework with whom responsibility for funding decisions in individual cases rests under LASPO, has refused those applications.

By a letter dated 24 May 2013, the Legal Aid Agency, on behalf of the Director, confirmed its view that s.204 appeals do not fall within the new Public Law Category introduced as a result of LASPO. By a letter dated 14 June 2013, the Claimant sought a formal review of that decision, under cl. 27.4 of the Standard Terms of its contract. By a letter dated 28 June 2013, the Legal Aid Agency confirmed its view, thereby concluding the review process. By this claim, issued on 11 September 2013 under cl. 28.7 of the Standard Terms, the Claimant has referred the issue to this Court for resolution.

The question whether s.204 appeals fall within the Public Law Category turns on a narrow issue of statutory construction – namely whether they fall within the definition of “judicial review” in paragraph 19(10) of Part 1, Schedule 1 to LASPO. This depends on whether the county court when hearing s. 204 appeals is, in the words of that paragraph in Part 1, Schedule 1 to LASPO:-

“required by an enactment to make a decision applying the principles that are applied by the court on an application for judicial review”.

The Claimant contends that the county court is so required to apply those principles when dealing with appeals against homelessness decisions under s. 204 of the Housing Act 1996. In support, reliance is placed on various matters including first, on the approach of the Court of Appeal in Begum (Nipa) v Tower Hamlets [2000] 1 WLR 306 (“Nipa Begum”); second, on statements made by members of the House of Lords in Begum (FC) v London Borough of Tower Hamlets [2003] 2 AC 430 (“Runa Begum”); third, various other matters including the Civil Legal Aid (Merits Criteria) Regulations 2013 (‘the Merits Regulations’) (SI/2013/104), the 2013 post-LASPO Category Definitions (“the Category Definitions”) and the Lord Chancellor’s Guidance under section 4 of LASPO (“the Guidance”) as well as CPR53PDD29.

The Legal Aid Agency’s case is that the county court is not “required by an enactment to make a decision applying the principles that are applied by the court on an application for judicial review”. The mere fact that it is usual or permissible for the county court to apply judicial review principles when reaching a decision on a section 204 appeal does not satisfy the statutory requirement of the need for there to be a requirement to apply judicial review principles by “an enactment”. This entails identifying the relevant enactment containing this specific requirement. To understand the context of the dispute, it is necessary to understand the changes to the statutory provisions relating to the granting of civil legal aid.

The arrangements for the provision of publicly-funded services under the civil legal aid scheme (as defined by LASPO) are governed by the terms of the Standard Civil Contract 2010 (as amended) or the 2013 version. Under the Standard Civil Contract 2010/2013, civil legal aid is subdivided into different categories. The Category Definitions 2010 (as amended) and 2013 explain which services fall into each of these categories and some services may fall into more than one category.

In order to be entitled to carry out legally aided work in a category, a provider, such as the Claimant, must have a “Schedule Authorisation” for that category of work or in the case of services that fall into more than one category, a Schedule Authorisation in at least one of those categories. Before 1 April 2013, it was possible for providers to undertake at least some legally aided work in some categories of law in which they did not hold a Schedule Authorisation.

Since 1 April 2013, the scheme has changed to one of exclusivity of all categories, including the Housing Category. In other words, it is generally not possible for a provider to undertake work in a category unless the provider holds a Schedule Authorisation for that category.

In the version of the Category Definitions 2010 that pre-dated 1 April 2013, the Public Law Category definition was very wide, and in so far as material, it stated that:-

“1.

Legal Help and related proceedings concerning:

(a)

the civil liberties or human rights of the client or a dependant, including under the Human Rights Act 1998, and matters involving the application of the European Convention on Human Rights (and other human rights instruments ratified by the UK) in English law;

(b)

public law challenges to the acts, omissions or decisions of public bodies, including challenges by way of judicial review or habeas corpus; and

(c)

proceedings under section 222 Local Government Act 1972.”

In the post-1 April 2013 Category Definitions, the Public Law Category definition now provides, in so far as is material, that:-

“34.

Legal Help and related proceedings concerning:

a.

the human rights of the client or a dependant of the client other than matters which fall within the definition of another Category;

b.

public law challenges to the acts, omissions or decisions of public bodies, including challenges by way of judicial review or habeas corpus.”

It is important to stress that all these provisions are subject to a separate introductory section of the amended Category Definitions 2010. It precedes the specific sections on the categories, and it states (with emphasis added) that:-

“Judicial Review and Public Law

19.

Public law challenges to the acts, omissions or decision of public bodies (including under the Human Rights Act 1998), in particular challenges by way of judicial review (as described in paragraph 19 of Part 1 of Schedule 1 to the Act) and habeas corpus (as described in paragraph 20 of Part 1 of Schedule 1 to the Act) are covered by the Category in which the principal matter or proceedings appear or by the Category which relates to the underlying substance of the case (as referenced by the widest Category Definition incorporating excluded work). They are also covered by the Public Law Category.

20.

If arising in respect of matters or proceedings within the Crime Category, these cases will also fall within the Crime Category.

21.

Note that the fact that a Defendant is a Public Authority does not bring a case within the Public Law Category. For a case to constitute a public law challenge it must be determined according to judicial review principles (limited to paragraph 19 Part 1 of Schedule 1 to the Act). Claims for damages against Public Authorities, other than Human Rights Act claims, do not usually fall within Public Law but may come within Actions Against the Police etc. Claims under the Human Rights Act may well come within both Public Law and Actions Against the Police etc.”

So since 1 April 2013, judicial review claims do not fall within the Public Law Category unless they also meet the definition of “judicial review” in paragraph 19(10) of Part 1, Schedule 1 to LASPO. In other words, the Public Law Category definition is now subject to the provisions in paragraph 19 of Part 1, Schedule 1 to LASPO. Therefore, the pre-LASPO description of the Public Law Category has been radically changed because the material part of paragraph 19 provides that:-.

“19.

Judicial Review

(1)

Civil legal services provided in relation to judicial review of an enactment, decision, act or omission....

(10)

In this paragraph...

“judicial review” means—

(a)

the procedure on an application for judicial review (see section 31 of the Senior Courts Act 1981), but not including the procedure after the application is treated under rules of court as if it were not such an application, and

(b)

any procedure in which a court, tribunal or other person mentioned in Part 3 of this Schedule is required by an enactment to make a decision applying the principles that are applied by the court on an application for judicial review; ...”

Returning to the issue of legal aid for the cases with which this judgment is concerned in section 204, homelessness cases are eligible for civil legal aid as paragraph 34 of Part 1 Schedule 1 LASPO provides that:-

“(1)

Civil legal services provided to an individual who is homeless, or threatened with homelessness, in relation to the provision of accommodation and assistance for the individual under—

…

(b)

Part 7 of that Act (homelessness)...”

Homelessness cases come within Part 7 of the Housing Act 1996 and therefore s.204 appeals are only within the scope of civil legal aid, but they are only within the scope of the Public Law Category if they satisfy the crucially important requirements of paragraph 19 of Part 1 of Schedule 1, which is the issue with which this case is concerned.

On 15 November 2010, the Claimant entered into a contract with the Legal Services Commission, which was the precursor of the Legal Aid Agency, which provided for payment for advice and representation for eligible clients in the public law and community care categories. The 2010 contract was originally to last for three years until 14 November 2013, but it was subsequently extended to 31 March 2014 and it has more recently been extended once more to November 2015.

The Claimant explains that it is one of the largest publicly funded solicitors’ practices in the country with contracts in crime, family, public law and community care. It has never applied for a specific contract to do housing work. After it entered into the 2010 contract, the Claimant expanded its public law team and has developed a significant presence in public law both in the Midlands and nationally.

In 2011, the Grand Chamber of the European Court of Justice decided, in Case C-34/09 Ruiz Zambrano v Office national de l’emploi, [2011] ECR I-1177. that Article 20 TFEU precluded Member States of the EU from refusing a third-country national a right of residence and a work permit in circumstances where his minor, dependent children were EU citizens, as such refusals would deprive the children of the enjoyment of the substance of their rights qua EU citizens. The effect of Zambrano is to confer on the primary carer of a child with the nationality of a Member State a derivative right to remain in that Member State. This has given rise to domestic litigation as to the entitlement of such carers to, inter alia, assistance from local housing authorities.

Before LASPO came into force on 1 April 2013, the Claimant was instructed to act on behalf of several publicly-funded Zambrano carers, who had applied to their local housing authorities for assistance but who had received negative decisions, in their respective s. 204 appeals. The Claimant was able to undertake such legal aid work under its public-law contract.

Prior to April 2013 when the legal aid aspects of LASPO came into force, the Claimant acted for eight such clients. In each of these cases they initially provided advice and assistance under the Legal Help scheme and subsequently provided representation under legal aid certificates granted under the public law element of the 2010 contract. In each of these cases, funding was provided to pursue an appeal to the county court under s.204 of the Housing Act 2006.

Since 1 April 2013, while the Claimant has been allowed to undertake a few publicly-funded Zambrano cases, this has been achieved by the grant of individual case contracts in respect of each Zambrano client, but significantly not on the basis that the work in question falls within the scope of the Claimant’s Standard Civil Contract 2010 (as amended).

On 24 April 2013, the LAA rejected an application for funding for such a case on the basis that “the LSC funding code no longer applies to new matters under LASPO Act and Regulations. .... An appeal in the county court is not a Judicial Review”. Although that case was granted a certificate under the public law contract pending further consideration of the position, as I have explained in paragraph 3 above, there then followed a protracted e-mail exchange which culminated in the commencement of the present proceedings.

In subsequent applications for approval for funding, the initial applications were turned down as being out-of-scope of the public law contract, but eventually the LAA’s Special Cases Unit approved individual case contracts upon the Claimant satisfying the “effective administration of justice” test set out in reg. 31(5) of the Civil Legal Aid (Procedure) Regulations 2012. Four such individual case contracts have been granted to pursue s.204 appeals.

The case for the Claimant is that in deciding if section 204 appeals fall within the Public Law Category, it is necessary to consider the contract together with the Category Definitions because they require under paragraph 21 of the Category Definitions to be determined according to public law principles as set out in paragraph 19(10) of Part 1, Schedule 1 to LASPO. The issue is therefore whether s.204 requires the county court in the words of paragraph 19(10) “to make a decision applying the principles that are applied by the court on an application for judicial review”.

Mr. Ian Wise QC, counsel for the Claimant, contends that the fact that s.204 does not expressly state that such principles must be applied is not determinative of the issue. He submits that what is clear is that the county court is in fact required to apply judicial review principles when deciding s. 204 appeals. In support of this proposition, Mr. Wise relies on a number of factors such as that :-

The response of Ms Sarah Love, counsel for the Defendant, is first, that s. 204 does not state that judicial review principles must be applied unlike its neighbouring provision s. 204A, and second that to obtain legal aid not merely must there be a requirement for judicial review principles to be applied, but also additionally, it must, in the words of Paragraph 19 (10), also be “required by an enactment”. In other words, the source of the requirement has to be in the text of an enactment as otherwise those words (“required by an enactment”) will be disregarded.

I am grateful to counsel for their helpful oral and written submissions.

The issues are therefore:-

The Construction Issue

This raises the question of whether s.204 contains an express requirement under which the county court in the words of paragraph 19(10) of Part 1 of Schedule 1 to LASPO “is required by an enactment to make a decision applying the principles that are applied by the court on an application for judicial review” with the consequence that s.204 applications fall within the Public Law Category. Mr. Wise contends that they do, but Ms Love disagrees.

S.204 states, with emphasis added, that an applicant “may appeal to the county court on any point of law arising from the decision or…the original decision”. To my mind, this shows clearly that this is not a case where in the words of Part 1, Schedule 1, paragraph 19 (10), “the court…is required by an enactment to make a decision applying the principles that are applied by the court on an application for judicial review”. The draftsman clearly draws a very important difference between “an appeal …on any point of law” in s.204 (1) and “the principles that are applied by the court on an application for judicial review” in s.204A (4) by using these different terms for different classes of cases in the Housing Act 1996.

This is a crucial distinction because it is settled law that, in the words of Bennion on Statutory Interpretation (6^th Edition, 2013) page 1035, “unless the contrary intention appears, a variation in the term used is taken to denote a different meaning, because to intend the same meaning is bad practice”. The example given is of Trustee Solutions v Dubery [2007] 1 All ER 308 [34] in which the phrases used were “notice under hand” and “notice in writing” of which Lewison J (as he then was) said “one would normally expect the two different phrases to have different meanings”.

Indeed Bennion at page 1035 also cites the statement of Blackburn J that:-

“It has been a general rule for drawing legal documents from the earliest times one which is taught when one first becomes a pupil to a conveyancer, never to change the form of words unless you are going to change the meaning” (Hadley v Perks (1866) LR 1 QB 444, 457).

Applying that principle here, it follows that the failure of the legislature to refer to judicial review principles in s.204, unlike the way it does in s.204A, shows that it was not intended that judicial review principles would be applied in s.204. To reach a different conclusion would entail rewriting s.204 and that is not permissible especially as if the legislature had intended that the county court should apply judicial review principles in section 204 challenges, they could have so provided as they did in s.204A.

For the purpose of completeness, I should add that I have considered, but rejected, the suggestion that those drafting Paragraph 19(10) of Schedule 1 intended that cases in which the county court was required to determine a point of law would qualify for legal aid in the same way as those cases in which the principles to be applied by the county court were those on an application for judicial review. That approach must be rejected because the draftsmen made it clear in particular when the qualification for granting legal aid would be any appeal on a point of law such as in paragraphs 8(1) and 8A(1) of Schedule 1 which relate respectively to appeals relating to welfare benefits and council tax reduction schemes. There was some discussion as to whether any relevant passages to Hansard might assist but the matter of construction is so clear that it is not permissible to do so.

The Nipa Begum Point in the Court of Appeal

Before the 1996 Act came into force, challenges to decisions of local authorities with respect to homelessness decisions were brought by way of judicial review in the High Court and in Nipa Begum, the courts stated that s.204 gave a right akin to judicial review. Mr. Wise refers to the presumption in Bennion section 235 (p.661), under the sub-heading “Tacit legislation”, in which it is stated that:-

“Parliament is normally presumed to legislate in the knowledge of, and having regard to, relevant judicial decisions. If therefore Parliament has a subsequent opportunity to alter the effect of a decision on the legal meaning of an enactment, but refrains from doing so, the implication may be that Parliament approves of that decision and adopts it. This is an aspect of what may be called tacit legislation.”

It is then contended that in the words of Mr. Wise’s Note that:-

“The Court of Appeal decided Nipa Begum in November 1999 and s.204A was brought into force by s.11 of the Homelessness Act 2002. Consistent with Bennion’s section 235 it can be implied that Parliament approved of the Court of Appeal’s decision in Nipa Begum and adopted the approach it set out to the role of the county court in s.204 appeals. It follows that it is not necessary, as the defendant contends, for Parliament to expressly insert a requirement to apply judicial review principles into s.204 for there to be a requirement that such principles shall be applied”.

This entails considering what was said in that case and Auld LJ explained in Nipa Begum [2000] 1 WLR 306 at 314 A-B that:-

“As to policy, the introduction of section 204 of the Act of 1996 of the new right of appeal to the county court in homelessness cases was intended to transfer from the High Court to the county court the main strain of the High Court’s otherwise onerous task of judicial review of decisions for which section 202 provides. ...”

The first of the four main issues arising in the Nipa Begum case was “the breadth of the jurisdiction of the county court under section 204 of the Act, giving an applicant for review a right of appeal to the county court “on any point of law arising from “the decision on the review or the original decision”, (p.311 A-B). Auld LJ observed on that issue (with emphasis added) that (p.312 F-H):-

“The short question is whether section 204, in providing for an appeal to the county court “on any point of law arising from” the review or original decision, gives it a power akin to that of judicial review exercisable in the High Court, including the power to quash a decision on grounds of irrationality. The judge held that it does; and as a matter of construction and of policy, I have no doubt that he was right in so holding.”

Sedley LJ agreed with “everything said by Auld LJ” on this issue and he then proceeded to say (with emphasis added) that:-

“the jurisdiction of the county court is at least as wide as that of a court of judicial review”, (p.327 A-C).

Pausing at this stage, it is significant that the Court of Appeal was not considering in NipaBegum whether the county court is in the words of Part 1, Schedule 1, paragraph 19 (10) (with emphasis added) “required by an enactment to make a decision applying the principles that are applied by a court on an application for judicial review”, but the separate and very difficult issue of whether its powers are-in the words of the judgments which I have quoted- “akin to” or “similar to” those of the High Court on judicial review. In other words, the Court of Appeal was considering whether the county court could use grounds such as Wednesbury unreasonableness as well as “classic” appeal grounds of law. Nothing was said in NipaBegum which shows either that the approach of the county court on s. 204 appeals was identical to the powers of the High Court on a judicial review application or that it was “required by an enactment”. So that case does not assist the Claimant’s submission.

The Runa Begum point.

Mr. Wise also seeks to derive assistance from the approach in the Runa Begum case in the House of Lords, which concerned the compatibility of the decision-making and appeals procedure in Part 7 of the 1996 Act with Article 6(1) ECHR. One of the questions before the Appellate Committee was whether s. 204 appeals to the county court sufficed to guarantee compliance with Article 6(1).

Members of the Appellate Committee described the county court’s s.204 jurisdiction in these ways:-

I agree with Ms Love that none of their Lordships stated that the 1996 Act mandates the application of judicial review principles by the county court in s.204 appeals. In fact, while their Lordships cited Nipa Begum in relation to the court’s jurisdiction in s. 204 appeals, none of them subjected the Court of Appeal’s decision in that case to comment or analysis. Runa Begum does not develop the jurisprudence on the issue beyond the Nipa Begum decision. Therefore, even if one takes the Claimant’s principal argument on the premise (which I do not accept) that there does not need to be express wording in the statutory provision itself as long as there is case-law mandating the application of judicial review principles, neither Nipa Begum nor Runa Begum supports this contention. I should stress that I consider that there has to be express wording as in the words of paragraph 19(10) of Part 1 of Schedule 1 to LASPO the county court has to be “required by an enactment to make a decision applying the principles that are applied by the court on an application for judicial review”.

The Merits Regulations

Mr. Wise submits that the definition of “public law claim” in regulation 2 of the Merits Regulations “suggests that the intention was that homelessness cases should fall within the public law category for funding purposes”.

It is true that in regulation 2 “public law claim” is stated to mean:-

“any matter which is described in any of the following paragraphs of Part 1 of Schedule 1 to the Act (civil legal services) (a) paragraph 19 (judicial review)…”

I am unable to understand why this statement in this subordinate legislation can determine or even influence the meaning of the terms in Schedule1, Part 1 of LASPO as they serve totally different purposes. The Guidance and the Merits Regulations both explain the considerations to be taken into account and the threshold for deciding whether individual cases qualify for funding. Indeed this is borne out by the second paragraph of the Guidance, which states that:-

“This guidance sets out some of the factors that caseworkers should take into account in deciding applications for civil legal services…”

So looking to the Merits Regulations and the Guidance made under it to determine what Schedule 1, Part 1 of LASPO means is in a manner of speaking looking at matters back to front in that those two documents only become relevant after a claim is deemed to fall within Part 1, Schedule 1, Paragraph 19(10). So the passages relied on by the Claimant in the Merits Regulations and the Guidance do not deal with or even throw any light on the issue with which I am concerned which is the more basic issue of whether the ambit of s.204 of the Housing Act 1996 falls within Part1, Schedule 1, Paragraph 19(10). I am fortified in reaching that conclusion by the fact that there is nothing in the Merits Regulations or the Guidance to show that anything in them is intended in any way to throw light on the meaning on any part of Part 1, Schedule1, Paragraph 19(10).

CPR52 PDD29.

Mr. Wise seeks to rely on this Practice Direction which deals with appeals to the county court and provides that:-

“Appeals under sections 204 and 204A of the Housing Act 1996

28.1(1) An appellant should include appeals under section 204 and section 204A of the Housing Act in one appellant’s notice”.

I cannot understand why that provision means that the same approach should be applied to each of these appeals or indeed if there is to be a common approach why it should be that judicial review principles should be applied.

The best interests of the client

It is said that the interpretation contended for by the Defendant would not be in the best interest of clients and a detailed argument is put forward in support. I do not see how such an argument can overcome the conclusion that must be reached in the light of the true construction of Part1, Schedule1, Paragraph 19(10).

Conclusion

Pulling these threads together, I have concluded that to qualify for civil legal aid under Part 1, Schedule 1, Paragraph 19(10), there is no express requirement in s.204 for the application of the principles applied by the court on an application for judicial review.

I now have to consider if there any other reasons why the provisions in s. 204 require the application of judicial review principles with the consequence that s. 204 applications fall within the Public Law Category.

Mr. Wise submits first, that an appeal on a point of law excludes an appeal on the facts and second, that the case law shows in the words of his skeleton that a “point of law is not to be narrowly construed as a departure from the statutory requirements (what Auld LJ described as ‘legal interpretation’), but also includes the common law requirements of judicial review”.

He stresses that, as Fordham bluntly puts it, “As a result of the landmark Anisminic case judicial review is available to correct a material error of law.” (Judicial Review Handbook, 6^th ed. 48.2) and “errors of law are correctable by judicial review” (ibid 16.3). In the context of appeals to the Upper Tribunal Lord Dyson SCJ said in R (Cart) v Upper Tribunal [2012] 1 AC 663 at [133] that:-

“in practice there is little if any substantive difference between an appeal on a point of law and judicial review.”

Ms Love submits correctly in my opinion that although there is a substantial overlap between judicial review claims and appeals on points of law, it does not follow that every judicial body with jurisdiction limited to points of law is required to apply judicial review principles in every case. She gives the examples of appeals to the Employment Appeal Tribunal from Employment Tribunals, appeals to the Court of Appeal from the High Court and challenges to arbitration awards under s.69 of the Arbitration Act 1996. In none of those appeals is the appellate court required to apply judicial review principles. If Mr. Wise was right, then in each of these cases, the appellate court would be bound to apply judicial review principles and I cannot accept that.

A further answer to Mr. Wise’s point is that the draftsman clearly draws a very important difference between “an appeal …on any point of law” in s.204 (1) and “the principles that are applied by the court on an application for judicial review” in s.204A (4) by using these different terms for different classes of cases in the Housing Act 1996. This important difference should not be disregarded.

I therefore conclude that in s.204 appeals, the county court is not in the words of paragraph 19(10) of Part 1 of Schedule 1 to LASPO “required by an enactment to make a decision applying the principles that are applied by the court on an application for judicial review”.

In consequence, s.204 applications do not fall within the Public Law Category post-LASPO and so the claim fails.

Right of appeal to county court on point of law

If an applicant who has requested a review under section 202—

An appeal must be brought within 21 days of his being notified of the decision or, as the case may be, of the date on which he should have been notified of a decision on review.

On appeal the court may make such order confirming, quashing or varying the decision as it thinks fit.

Where the authority were under a duty under section 188, 190 or 200 to secure that accommodation is available for the applicant’s occupation , or had the power under section 195(8) to do so, they may secure that accommodation is so available—

This section applies where an applicant has the right to appeal to the county court against a local housing authority’s decision on a review.

If the applicant is dissatisfied with a decision by the authority—

An appeal under this section may not be brought after the final determination by the county court of the main appeal.

On an appeal under this section the court—

If the court quashes the decision it may order the authority to exercise the section 204(4) power in the applicant’s case for such period as may be specified in the order.

An order under subsection (5)—