Steed v Secretary of State for the Home Department

A statutory compensation scheme may confer an enforceable entitlement to payment once its stated conditions have been satisfied. Where the scheme specifies no period for deciding a claim, it may be arguable that approval or rejection must occur within a reasonable time.

The rule favouring judicial review for challenges to public-law decisions is a general rule directed to preventing abuse of process. It does not create an inflexible procedural boundary. An ordinary action may proceed where the claimant essentially seeks money due, the issues are objective or capable of judicial determination, and the chosen procedure causes no significant disadvantage to the parties, the public or the court.

The respondent surrendered firearms and ammunition under the Firearms (Amendment) Act 1997 Compensation Scheme. He claimed that the Home Office had failed to determine and pay his claims within a reasonable time. After the principal compensation was paid, his remaining claim was for interest representing loss caused by delay.

The Home Office applied to strike out the county court proceedings. It maintained that, until the Scheme's procedures had established entitlement and value, any complaint about delay could be pursued only by judicial review. District Judge Madge refused to strike out the claim. His Honour Judge Cowell dismissed an appeal, and the Court of Appeal dismissed a further appeal on 1 May 1998.

The central issues were whether the Scheme conferred a right to compensation, whether claims had to be determined and paid within a reasonable time, and whether pursuit of that right by ordinary summons was an abuse of process.

1. Appeal dismissed unanimously. Lord Slynn of Hadley delivered the leading speech. Lord Woolf M.R., Lord Hope of Craighead, Lord Clyde and Lord Millett expressly agreed with his reasons. The district judge was entitled and right to refuse to strike out the summons.

2. Per Lord Slynn, once the conditions prescribed by the Firearms (Amendment) Act 1997 Compensation Scheme were satisfied, a claimant became entitled to the applicable payment. Options A and B prescribed automatic payments. Option C required satisfactory evidence of market value or, where necessary, an independent valuation.

3. Although the Scheme fixed no period for consideration or approval, it was at least plainly arguable on a strike-out application that approval or rejection had to occur within a reasonable time. What was reasonable could differ between the straightforward Options A and B and the potentially more complex Option C. The assessment had to accommodate both the claimant's reasonable expectation of compensation for surrendered property and the number of claims being administered. Once approval was given, payments under Options A and B had to be made “shortly”, while an Option C payment had to follow “as soon as” the claimant returned the required agreement.

4. Per Lord Slynn, the rule in O'Reilly v Mackman [1983] 2 AC 237 was a general rule against abuse of process, not an inflexible division between public-law and private-law procedures. Exceptions were to be determined case by case. The overriding question was whether the selected proceedings constituted an abuse, taking account of their practical consequences and any significant disadvantage to the parties, the public or the court.

5. The respondent's essential allegation was that money had become due and that delayed payment had caused loss measured by interest. The relevant issues were largely objective questions concerning the surrendered items, completion of the Scheme's procedures and valuation. They could be decided by a judge without usurping an administrative discretion. An ordinary summons was therefore a convenient procedure and was not abusive. A general challenge to the Scheme's validity or compatibility with its statutory purpose would ordinarily have called for judicial review.

6. The House did not determine whether interest was ultimately payable. If the matter could not be agreed, the county court was to decide whether the claim had been determined within a reasonable time and whether payment had then been made in accordance with the Scheme.

1. House of Lords: Dismissed the Home Office's appeal unanimously and upheld the refusal to strike out the summons.
2. Court of Appeal: Dismissed the Home Office's appeal on 1 May 1998.
3. County Court, His Honour Judge Cowell: Dismissed the Home Office's appeal from District Judge Madge on 17 February 1998.
4. County Court, District Judge Madge: Dismissed the Home Office's application to strike out the summons on 22 January 1998.