Nash, R (on the application of) v Barnet London Borough Council

Where a local authority proposes outsourcing as a means of fulfilling its best value duty, consultation under section 3(2) of the Local Government Act 1999 concerns the formative questions of policy and approach. It does not concern the eventual contractor or detailed contractual terms.

In staged decision-making, time for judicial review runs when the grounds first arise against the substantive decision being challenged. A later decision does not restart time where the earlier decision had legal effect and initiated a distinct, resource-intensive procurement stage. The position differs where the earlier act was merely preliminary, provisional or contingent. A continuing opportunity to consult or reconsider does not create a fresh limitation period.

Barnet London Borough Council decided in 2010 and 2011 to begin procurement processes for the proposed outsourcing of development, regulatory, customer and support services. Following competitive dialogue, it selected a preferred bidder for one contract in December 2012. Mrs Nash commenced judicial review proceedings in January 2013, alleging principally that the Council had failed to consult under section 3(2) of the Local Government Act 1999.

Underhill LJ refused permission in [2013] EWHC 1067 (Admin). He held that the consultation challenge was substantially out of time and declined to extend time, although he considered that the Council would otherwise have breached its consultation duty.

At a rolled-up hearing, the central issue was whether the grounds first arose upon the decisions to commence procurement in 2010 and 2011 or upon the later decision to award a particular contract.

1. The application for permission to appeal was refused. The consultation challenge had arisen when the Council made the substantive decisions in 2010 and 2011 to begin the procurement processes. Proceedings commenced in January 2013 were therefore well outside the three-month period under rule 54.5(1)(b) of the Civil Procedure Rules 1998. Davis LJ delivered the judgment, with which Gloster LJ and the Master of the Rolls agreed.

2. Section 3 of the Local Government Act 1999 is framed broadly. Consultation under section 3(2) assists an authority in deciding how to fulfil its duty to secure continuous improvement in the exercise of its functions. It is therefore directed to formative questions of policy and approach. It does not require consultation about a particular contractor or the detailed terms of a proposed contract, where commercial confidentiality may also constrain disclosure.

3. The claimant's true complaint concerned the failure to consult about outsourcing in principle. That duty, if applicable, first arose before the Council decided to commence procurement. The 2010 and 2011 decisions had legal and practical consequences: they authorised competitive dialogue under the Public Contracts Regulations 2006 and led foreseeably to substantial expenditure and work. They were distinct substantive decisions rather than provisional views.

4. R (Burkett) v Hammersmith and Fulham London Borough Council [2002] UKHL 23 was distinguished. Its reasoning applies where an earlier resolution is merely preliminary, provisional or contingent and has no operative legal effect. It does not establish that, in every staged process, time runs afresh from the latest or ultimate decision. The nature of each decision and its relationship with the alleged breach must be analysed.

5. The Council's continuing ability to consult, reconsider or withdraw did not postpone the starting date. Rule 54.5 measures time from when the grounds first arose. A later contract-award decision did not revive a challenge to an earlier failure to consult about the outsourcing policy.

6. As the proceedings were out of time and the refusal to extend time was not challenged, it was unnecessary to determine the alternative grounds in the respondent's notice. Any observations on them would have been obiter.

1. Court of Appeal (Civil Division): At a rolled-up hearing, refused permission to appeal and upheld the conclusion that the judicial review proceedings were out of time: [2013] EWCA Civ 1004.
2. High Court, Administrative Court: Underhill LJ refused permission to apply for judicial review because the challenge had been brought substantially out of time and an extension was inappropriate: [2013] EWHC 1067 (Admin).