James v Hertsmere Borough Council

An appeal to the county court under section 204 of the Housing Act 1996 may raise any point of law concerning the lawfulness of a homelessness review decision. Its scope includes procedural error, vires, irrationality and inadequate reasons. It is not confined to housing law or errors intrinsic to the review process.

Where a contract authorising an external reviewer covers work commissioned during its term, the reviewer may complete that work after the term expires if the contract, objectively construed as a whole, so provides. A defect in authorisation may also be ratified by a person with the necessary power where the underlying act was within the local authority’s powers.

The appellant applied to the respondent council for homelessness assistance. The council decided that he was not vulnerable and therefore was not in priority need. A contracted-out reviewer upheld that decision under section 202 of the Housing Act 1996.

The review was commissioned while the council’s contract with the reviewer was in force but completed after the initial contractual term had expired. The appellant appealed under section 204, arguing that the review decision was unauthorised and that later ratification could not validate it. Recorder Richard Methuen QC dismissed the appeal, principally because the council’s Leader had ratified any irregularity.

The Court of Appeal considered the scope of the county court’s statutory jurisdiction, the proper construction of the outsourcing contract and the effectiveness of ratification.

1. Appeal dismissed. A point of law arises from a review decision for the purposes of section 204 of the Housing Act 1996 where it concerns or relates to the lawfulness of that decision. The county court’s jurisdiction extends to the full range of issues that would otherwise be raised on judicial review, including procedural error, vires, irrationality and inadequate reasons. It is not confined to housing law, intrinsic errors in the decision-making process or events occurring between the review request and the review decision.

2. The statutory scheme was intended to transfer the main burden of challenges to homelessness review decisions from the High Court to the county court. A divided jurisdiction would undermine the availability of a quick, inexpensive and local appeal. Nipa Begum v Tower Hamlets LBC [2000] 1 WLR 306, Runa Begum v Tower Hamlets LBC [2003] 2 AC 430 and Tachie v Welwyn Hatfield Borough Council [2013] EWHC 3972 (QB) supported that construction. The narrower concerns expressed obiter in Panayiotou v Waltham Forest LBC [2017] EWCA Civ 1624 did not justify restricting the jurisdiction.

3. A county court may transfer an issue of general public importance to the High Court under section 42 of the County Courts Act 1984 and CPR rule 30.3(2)(e). It should nevertheless be slow to conclude that it cannot determine an issue itself.

4. Objectively construed as a whole, the contract authorised the reviewer to complete reviews commissioned during the initial contractual term even if completion occurred afterwards, provided that the contract had not been terminated. The contrary interpretation would prevent the commissioning of reviews near the end of the term and would disrupt the continuing public function. This conclusion was sufficient to dismiss the appeal.

5. Alternatively, any defect was validly ratified by both the Leader and the Chief Executive. The contracted-out delivery of review decisions was within the council’s powers. The case was therefore unlike authorities concerning acts outside the powers of a company or local authority. Ratification remedied a formal defect that did not affect the merits or deprive the appellant of a genuine legal right.

6. The court did not reach a concluded view on whether the authorised officer had validly extended the contract or whether an extension had to be recorded in writing.

1. Court of Appeal (Civil Division): The appeal was dismissed. The court upheld the dismissal below because the reviewer was authorised to complete a review commissioned during the contractual term and, alternatively, because any defect was validly ratified.

2. Central London County Court: Recorder Richard Methuen QC dismissed the statutory appeal on 20 February 2019. He held that any irregularity in the extension of the outsourcing contract had been cured by ratification by the council’s Leader.