Davies and another t/a All Stars Nursery v The Scottish Commission for the Regulation of Care (Scotland)

Where transitional legislation continues a repealed statutory regime but omits to identify the successor to a dissolved public body, a court may correct the drafting error if it is abundantly sure of the provision’s purpose, the inadvertence and the substance of the omitted provision. References to the dissolved body may then be read as references to its statutory successor.

Acts performed under the preserved regime by the successor remain valid despite an inaccurate description of it as agent for the dissolved body, where its true identity and authority are clear and no prejudice results. A court may also use its inherent jurisdiction to prevent continued reliance on obsolete regulatory decisions from becoming an abuse of process.

The appellants operated a registered children’s nursery. The Scottish Commission for the Regulation of Care decided in 2008 and 2009 to cancel its registration. The appellants appealed to the sheriff under section 20 of the Regulation of Care (Scotland) Act 2001.

Before those appeals were determined, the Public Services Reform (Scotland) Act 2010 dissolved the Commission, transferred its staff, property and liabilities to Social Care and Social Work Improvement Scotland (SCSWIS), and repealed Part 1 of the 2001 Act. Transitional legislation continued Part 1 for pending appeals but did not expressly identify the body which was to exercise the Commission’s functions.

The sheriff principal held that the Commission’s decisions could no longer have effect. The First Division, by a majority, reversed that decision: [2012] CSIH 7. The principal issues before the Supreme Court were whether the Commission continued to exist for the proceedings or had been replaced by SCSWIS, the validity of cancellation notices issued in 2012, and the future management of the parallel appeals.

1. Disposition. Lord Hope, with whom Lord Kerr, Lord Wilson, Lord Reed and Lord Carnwath agreed, affirmed the Inner House’s decision to allow the appeals from the sheriff principal. The remainder of the Inner House’s interlocutors was recalled and the case remitted for any further necessary orders.

2. Article 2(1) of the No 2 Transitional Order clearly continued Part 1 of the Regulation of Care (Scotland) Act 2001 for the nursery until final determination of the pending appeals. It nevertheless left a drafting gap because the Commission had been dissolved and could no longer act. The implied-agency analysis adopted by the Inner House majority was unsustainable: a dissolved body could not enter an agency relationship.

3. Applying Inco Europe Ltd v First Choice Distribution [2000] 1 WLR 586, the court could correct the evident drafting error. The statutory purpose, the inadvertence and the substance of the omitted provision were all sufficiently certain. Following the template in article 15(2) of the No 1 Transitional Order, references to the Commission in the preserved Part 1 were therefore to be read as references to SCSWIS.

4. The 2012 cancellation decision purportedly made under the Public Services Reform (Scotland) Act 2010 was ineffective because the nursery remained registered under the preserved 2001 regime. The corresponding decision under the 2001 Act was valid. Although SCSWIS had inaccurately described itself as agent for the Commission, it was the authorised body, its true identity was obvious and the appellants suffered no prejudice.

5. Continued reliance upon the 2008 and 2009 decisions, while pursuing the current 2012 decision, would be an abuse of process. Scots courts possess inherent jurisdiction to impose a procedural sanction for abuse without express statutory authority. The Supreme Court therefore directed under section 20(2) of the 2001 Act and rule 29(1) of the Supreme Court Rules 2009 that the 2008 and 2009 decisions should have no effect, without determining their merits.

6. Those proceedings were thereby finally determined. The nursery was henceforth to be treated as registered under Part 5 of the 2010 Act. The valid decision notified on 4 December 2012 was to be treated as made under section 73 of that Act, and its appeal was to proceed expeditiously under section 75.

1. United Kingdom Supreme Court: The court affirmed the Inner House’s allowance of the appeals from the sheriff principal, recalled the remainder of its interlocutors, directed that the 2008 and 2009 cancellation decisions should not have effect, and remitted the case.

2. First Division of the Court of Session: By a majority, the court allowed the Commission’s appeal, holding that the Commission continued for the proceedings and acted through an implied agency with SCSWIS: [2012] CSIH 7; 2012 SLT 269. Lord Marnoch dissented as to the proper respondent.

3. Sheriff principal: The sheriff principal held that the dissolved Commission’s decisions could no longer have effect and removed a condition imposed upon the nursery operator: 2011 SLT (Sh Ct) 208.

4. Sheriff: In the appeals under section 20 of the Regulation of Care (Scotland) Act 2001, the sheriff excluded evidence concerning the nursery’s condition after 30 March 2009 and granted leave to appeal that ruling.