James v Hertsmere Borough Council

The Court of Appeal held that the county court's statutory appeal jurisdiction under section 204 of the Housing Act 1996 is broad and extends to the full range of points of law that would otherwise be cognisable by judicial review, including challenges to the lawfulness of a contracting-out arrangement for homelessness reviews. The court further held that where a contracted reviewer was instructed to undertake a statutory review during the contractual term, the reviewer was authorised to complete that review even if completion occurred after the formal expiry of the contract. Alternatively, the court held that any defect in authorisation was cured by subsequent ratification by the Leader of the Council and by the Chief Executive. The appeal was dismissed.

Background and facts:

• Mr Gerald James applied to Hertsmere Borough Council for homelessness assistance. The Council decided he was not vulnerable and was intentionally homeless. He requested a review under s.202 Housing Act 1996.
• The Council had contracted out its s.202 review function to RMG Ltd. The contract commenced in September 2017 with an initial term to 11 April 2018. A statutory review of the Appellant was referred to RMG during the contract term but was not completed within the 56-day regulatory period and was finished in August 2018.

Procedural posture:

• The Appellant appealed the review decision to the county court under s.204. Recorder Methuen QC dismissed the appeal on 20 February 2019, relying on ratification of any contractual defect by the Leader of the Council. The Appellant appealed to the Court of Appeal. The appeal raised a single principal ground: that the review decision was of no effect because the contracting-out or any extension of authority was unlawful and could not be cured by ratification.

Issues framed:

1. Whether a s.204 appeal to the county court extends to challenges to the contracting-out of s.202 review functions.
2. Whether it was sufficient that the review was commissioned during the contractual term even though completed after it.
3. Whether the Authorised Officer had authority to extend the contract and whether any extension had to be in writing.
4. Whether subsequent acts of ratification by the Leader or Chief Executive validated the review decision.

Reasoning and conclusions:

• The court analysed statutory construction and authorities (including Nipa Begum, Runa Begum, Tachie and Nzolameso) and concluded that s.204 grants the county court a jurisdiction equivalent in scope to judicial review for points of law "arising from" the decision. This includes vires, procedural error, irrationality and related public law challenges. The court rejected a narrow reading that would confine s.204 to questions intrinsic to the making of the review decision.
• On the facts, the court held that authorisation to perform the review arose because the Council selected RMG to carry out the review during the contract term and did not terminate the contract; that commissioning sufficed to authorise completion even if completion occurred after expiry of the formal term. This finding alone made the review lawful.
• The court also addressed alternative grounds: it was doubtful that the Authorised Officer alone had power to extend the contract or that any extension was validly delegated or in writing, but these points were unnecessary to decide. The court concluded that the later ratifications by the Leader and the Chief Executive validated the extension or cured any formal defect, and that the acts were intra vires and not the sort of ultra vires acts that cannot be ratified.

Remedies and wider implications:

• The court observed that although the s.204 jurisdiction is wide, the county court should be slow to decline to determine issues and may transfer matters of general public importance to the High Court under s.42 County Courts Act 1984 and CPR 30.3(2)(e) if appropriate. The court emphasised the practical reasons for entrusting these appeals to the county court.

The appeal is dismissed. The Court of Appeal held that (1) the county court has jurisdiction under section 204 Housing Act 1996 to consider challenges to the lawfulness of review decisions arising from contracting-out arrangements, (2) a review commissioned during the contractual term was lawfully authorised to be completed even if finished after the contract term, and (3) in any event any defect was validly ratified by the Leader of the Council and the Chief Executive.

Appeal from Central London County Court (Recorder Richard Methuen QC, E40CL234) in which the appellant's s.204 challenge was dismissed on 20 February 2019. Permission to appeal to the Court of Appeal was granted by Patten LJ. The Court of Appeal handed down judgment on 2 April 2020 ([2020] EWCA Civ 489).