Clays Lane Housing Co-Operative Ltd v Housing Corporation

On a renewed application for permission to appeal, the court held that arguable issues arose as to the proportionality test under article 1 of the First Protocol to the European Convention on Human Rights. The proposed appeal could examine whether a compelling public-interest case is sufficient, or whether necessity and minimum interference are also required, and whether judicial review should be sufficiently rigorous and intrusive. Permission was also justified on an arguable procedural-fairness complaint concerning regulatory concerns and on complaints about undisclosed financial material. Article 11 was treated as adding no sufficiently central, independent issue to the property claim. Permission was granted on six grounds, but refused on ground 5. The court did not determine the merits of the proposed appeal.

The applicant, a housing co-operative, accepted that its housing stock should be transferred under the Housing Act 1996, but challenged the proposed transferee, the Peabody Trust, rather than another housing co-operative. Keith J refused judicial review of the Housing Corporation’s decision, taken with the Secretary of State’s consent. Buxton LJ refused permission to appeal. On renewal, the applicant advanced seven grounds concerning article 1 of the First Protocol, the intensity of judicial review, procedural fairness, article 11, and material concerning the relative financial strength of Peabody and Tenants First. The central question was whether the proposed grounds had a real prospect of success or another compelling reason why the appeal should be heard.

1. Permission and disposition. Lord Justice Auld granted permission on grounds 1–4, 6 and 7, and refused it on ground 5 concerning article 11. Lord Justice Jacob agreed. The appeal was not decided on its merits.

2. Article 1 of the First Protocol. Grounds 1–3 raised an arguable question whether the Strasbourg decision in James, concerning a legislative scheme, left open the meaning of proportionality when the validity of an individual transaction is examined. It was also arguable that the approach in Daly v Secretary of State for the Home Department [2001] 2 WLR 1622 and R v Shayler [2002] 2 WLR 754 had general application beyond their article 8 contexts, including to article 1 of the First Protocol. The proposed appeal could therefore examine both the applicable test and the required intensity of judicial review.

3. It was arguable that the judge had not undertaken sufficiently rigorous or intrusive review, or that the Housing Corporation had not properly applied the compelling public-interest test. Jacob LJ considered the points worthy of consideration, although he regarded Buxton LJ’s reasoning as compelling.

4. Procedural fairness. The Corporation’s regulatory concerns, and its refusal to meet the applicant’s representatives, raised an arguable issue. Jokela v Finland [2003] 37 ECRR 36, particularly paragraph 45, was identified as relevant authority on that issue.

5. Article 11 and financial material. Ground 5 was refused because the association argument had no sufficiently independent or central life beyond the property claim. Grounds 6 and 7 were allowed to proceed because material concerning the relative financial strength of Peabody and Tenants First had apparently been unavailable to the Corporation’s board, the Secretary of State and the applicant, potentially preventing informed decision-making and meaningful representations.

6. Expedition was ordered. Costs were to be costs in the appeal.

• Court of Appeal (Civil Division): On 28 July 2004, permission to appeal was granted on grounds 1–4, 6 and 7, but refused on ground 5.
• High Court of Justice, Queen’s Bench Division, Administrative Court: Keith J refused judicial review of the Housing Corporation’s decision by order dated 14 May 2004.
• Permission stage: Buxton LJ had refused the applicant’s application for permission to appeal; the application was renewed before the Court of Appeal.